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This was Franklin Delano Roosevelt's first inaugural speech, in March of 1933. He was elected into the worst depression the United States had ever endured, so severe a depression that it is referred to even now as the Great Depression. Banks had failed, the unemployment rate was over 25%, and millions of people were homeless and starving. His inaugural speech was meant to exhort the American people to rally and help him solve the great problems the country was facing.
In that one sentence, what he was telling the American people was common sense and good psychology. When we are afraid, it paralyzes us, like a deer in the headlights. If you have never been so afraid you could not act, that is wonderful, but this is what fear does to many people. He goes on, in fact, to explain this fear beautifully:
...nameless, unreasoning, unjustified terror which paralyzes needed efforts to convert retreat into advance (lines 4 and 5).
What he is saying here is that fear creates inaction, or even worse, causes us to retreat from our enemies, at the time when we most need to advance against our enemies. The enemy he is speaking of in this case is the Great Depression. We should be afraid of fear because this is what it does to us. When we fear, we cannot think properly or act properly, so fear is a greater enemy than any real enemy could be. It cripples people. If we did not fear, he argued, the American people had the resources and intelligence to solve the problem, and in fact, he was right, as FDR and the American people did manage to pull the country out of the Great Depression.
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