The Depression of 1920

Discussion in 'Economy' started by Kevin_Kennedy, Apr 11, 2009.

  1. Kevin_Kennedy
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    Kevin_Kennedy Defend Liberty

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    [youtube]czcUmnsprQI[/youtube]

    This video is a bit lengthy at nearly 50 minutes long, but it's an extremely good speech from Prof. Thomas E. Woods. He goes into detail about Warren Harding, the depression of 1920, stimulus packages, and the Austrian theory of the business cycle.
     
  2. Agnapostate
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    As put by no less an authority than Paul Cwik in Austrian Business Cycle Theory: A Corporate Finance Point of View, published in the Quarterly Journal of Austrian Economics:

    I'll concede that the Austrian school has not been entirely apathetic to remedying this. But their alleged "business cycle" theory remains woefully incoherent compared to anything more substantive from a school of thought that's not quite as anti-empiricist.
     
  3. Paulie
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    Paulie Platinum Member

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    And what school of thought, pray tell, would you consider to be more "coherent"?
     
  4. mash107
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    mash107 Active Member

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    The school that says, "if you spend too much money now, you won't have to buck down and save," of course!

    If only we didn't have to deal with a pesky thing called reality.

    Great speech though. Thomas Woods is my hero.
     
  5. Agnapostate
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    Agnapostate BANNED

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    The Chicago school, perhaps. And considering the Austrians' attempts to misappropriate a Coasian analysis of the firm and transaction cost theory, they evidently agree.
     
  6. Iriemon
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    Iriemon VIP Member

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    Can you summarize the points argued? I'm not going to watch a 50 minute video.
     
  7. Truthmatters
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    Truthmatters BANNED

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    I can summarize it without even watching it.

    The Free market is god and this all happened because they didnt allow corporations to do whatever they wanted without laws, rules or taxes.
     
  8. PoliticalChic
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    PoliticalChic Diamond Member

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    No doubt not-watching, and corollaries such as not-reading and not-listening are prime strategies that you employ as you embark on your journey through life, but you might want to consider this:
    The 1920-1921 Crash, due to the monetary flood of WWI, was handled by the best presidential recession-fighter in our history: Warren G. Harding.

    "One of Harding's campaign slogans was "less government in business," and it served him well. Harding embraced the advice of Treasury Secretary Andrew Mellon and called for tax cuts in his first message to Congress on April 12, 1921. The highest taxes, on corporate revenues and "excess" profits, were to be cut. Personal income taxes were to be left as is, with a top rate of 8 percent of incomes above $4,000. Harding recognized the crucial importance of encouraging the investment that is essential for growth and jobs, something that FDR never did."
    N-Philes :: Forums - View Single Post - The not-so-great depression of 1920-21
     
  9. Iriemon
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    Iriemon VIP Member

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    You are correct that Harding was part of a tax cutting effort, and that low taxes were in place up till higher taxes were passed by a cash starved Congress in 1932.

    However, with Harding's record as president during the free fall in the Great Depression(despite having low taxes), I'd personally have a hard time saying Harding was "the best presidential recession-fighter in our history" without gagging.

    Year - GDP Actual - % chng
    1930 91.2 -12.0%
    1931 76.5 -16.1%
    1932 58.7 -23.3%

    Year - GDP real 2000$ - % chng
    1930 790.7 -8.6%
    1931 739.9 -6.4%
    1932 643.7 -13.0%
     
  10. Truthmatters
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    Which is why I didnt bother to watch 50 minutes of some biased source saying all the clap trap I have heard so many times before.
     

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