PoliticalChic
Diamond Member
"President Obama: The Biggest Government Spender In World History" President Obama: The Biggest Government Spender In World History - Forbes
Far be it from I to defend this failure-in-chief, but it didn't begin with Obama.
1. It was during the 1930s that government subsides became the way of life in Washington.
Prior to that, subsidies were usually found to be inconsistent with the Constitution, and when they were given, at least Congress was held accountable, and had to run for reelection based on the success or failure of their largesse.
2. Two factors account for the increase in federal give-aways: The Depression changed the way government operated, and a cowardly Supreme Court increasingly viewed the Constitution as merely a suggestion.
Both Hoover and Roosevelt, and the Congress, created lots of new agencies with the power to give subsidies.
3. Enter, the Reconstruction Finance Corporation (RFC). Not only was the agency new, but so was it's founding concept: never before in US history (well...maybe in WWI) had the US established an independent agency with power to lend millions, later billions, to private corporations! The RFC gave the money, not Congress. Reconstruction Finance Corporation - Wikipedia, the free encyclopedia
4. Hoover believed that government intervention was needed to support private enterprise....while ignoring that government interventions helped cause the Depression:
"..in 1928 and 1929, the Federal Reserve raise interest rates four times, which made it harder for businessmen to borrow money to invest, and that hindered economic growth.
Second, the Smoot-Hawley Tariff, which Hoover signed in 1930, was the highest tariff in American history. It sharply raised rates on 887 items and virtually stopped foreign trade....
Third, Hoover raised tax rates across the board- from 24 to 63 percent on rich people...[which] slowed down investing....[ and establishing] new companies." Folsom, "New Deal or Raw Deal."
5. For purposes of comparison with the Hoover/Roosevelt economic policies, one should study the policies of Warren G. Harding, the greatest recession fighter in history!
"Harding inherited the mess, in particular the post-World War I depression almost as severe, from peak to trough, as the Great Contraction from 1929 to 1933, that FDR inherited and prolonged.
Richard K. Vedder and Lowell E. Gallaway, in their book "Out of Work", noted that the magnitude of the 1920 depression "exceeded that for the Great Depression of the following decade for several quarters." The estimated gross national product plunged 24% from $91.5 billion in 1920 to $69.6 billion in 1921. The number of unemployed people jumped from 2.1 million in 1920 to 4.9 million in 1921." Americas Greatest Depression*Fighter by Jim Powell
a. Harding cut federal spending by more than half, from a $6.4 billion budget in 1920 to $3.1 billion in 1923.
Also, he and his successor, Calvin Coolidge, cut tax rates on all income taxpayers during the 1920s- from 73 to 24 percent on the wealthiest Americans. The results were astonishing:
Unemployment plummeted from 11.7 percent to 2.4 percent from 1921 to 1923, and remained low for the rest of the decade. During the 1920s, living standards went up, gross national product increased almost 25%, and the federal government recorded budget surpluses every year- until the Federal Reserve raised interest rates and Congress passed Smoot-Hawley.
Folsom, "Uncle Sam Can't Count," p.141 and Time for Another Harding? | The Weekly Standard
b. In 1935, the Brookings Institution (left-leaning) delivered a 900-page report on the New Deal and the National Recovery Administration, concluding that on the whole it retarded recovery.
The Real Deal - Society and Culture - AEI
Harding policies worked, Hoover/Roosevelt....not so much.
Guess which Obama mirrors?
Far be it from I to defend this failure-in-chief, but it didn't begin with Obama.
1. It was during the 1930s that government subsides became the way of life in Washington.
Prior to that, subsidies were usually found to be inconsistent with the Constitution, and when they were given, at least Congress was held accountable, and had to run for reelection based on the success or failure of their largesse.
2. Two factors account for the increase in federal give-aways: The Depression changed the way government operated, and a cowardly Supreme Court increasingly viewed the Constitution as merely a suggestion.
Both Hoover and Roosevelt, and the Congress, created lots of new agencies with the power to give subsidies.
3. Enter, the Reconstruction Finance Corporation (RFC). Not only was the agency new, but so was it's founding concept: never before in US history (well...maybe in WWI) had the US established an independent agency with power to lend millions, later billions, to private corporations! The RFC gave the money, not Congress. Reconstruction Finance Corporation - Wikipedia, the free encyclopedia
4. Hoover believed that government intervention was needed to support private enterprise....while ignoring that government interventions helped cause the Depression:
"..in 1928 and 1929, the Federal Reserve raise interest rates four times, which made it harder for businessmen to borrow money to invest, and that hindered economic growth.
Second, the Smoot-Hawley Tariff, which Hoover signed in 1930, was the highest tariff in American history. It sharply raised rates on 887 items and virtually stopped foreign trade....
Third, Hoover raised tax rates across the board- from 24 to 63 percent on rich people...[which] slowed down investing....[ and establishing] new companies." Folsom, "New Deal or Raw Deal."
5. For purposes of comparison with the Hoover/Roosevelt economic policies, one should study the policies of Warren G. Harding, the greatest recession fighter in history!
"Harding inherited the mess, in particular the post-World War I depression almost as severe, from peak to trough, as the Great Contraction from 1929 to 1933, that FDR inherited and prolonged.
Richard K. Vedder and Lowell E. Gallaway, in their book "Out of Work", noted that the magnitude of the 1920 depression "exceeded that for the Great Depression of the following decade for several quarters." The estimated gross national product plunged 24% from $91.5 billion in 1920 to $69.6 billion in 1921. The number of unemployed people jumped from 2.1 million in 1920 to 4.9 million in 1921." Americas Greatest Depression*Fighter by Jim Powell
a. Harding cut federal spending by more than half, from a $6.4 billion budget in 1920 to $3.1 billion in 1923.
Also, he and his successor, Calvin Coolidge, cut tax rates on all income taxpayers during the 1920s- from 73 to 24 percent on the wealthiest Americans. The results were astonishing:
Unemployment plummeted from 11.7 percent to 2.4 percent from 1921 to 1923, and remained low for the rest of the decade. During the 1920s, living standards went up, gross national product increased almost 25%, and the federal government recorded budget surpluses every year- until the Federal Reserve raised interest rates and Congress passed Smoot-Hawley.
Folsom, "Uncle Sam Can't Count," p.141 and Time for Another Harding? | The Weekly Standard
b. In 1935, the Brookings Institution (left-leaning) delivered a 900-page report on the New Deal and the National Recovery Administration, concluding that on the whole it retarded recovery.
The Real Deal - Society and Culture - AEI
Harding policies worked, Hoover/Roosevelt....not so much.
Guess which Obama mirrors?