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Well the same principle that applies to the New Deal applies to World War 2. You can't spend your way out of a recession or a depression.
Yes, unemployment fell during WW2, but that's not surprising since so many were conscripted to go die over in Europe. The production of military goods over consumer goods, price controls, and rations are not the features of a booming economy.
The Great Depression didn't end until after WW2.
Yes I will agree with that. But you also must remember that during WW2 the Gov't had a much more productive relationship with businesses than in the 1930s, especially compared to the NRA which lead to the destruction of many small businesses. Some of the New Deal provisions and programs were also being dismantled by Robert Taft and his conservative coalition starting during WW2.
This has turned into a pea brain conversation...
First of all, I dispute the premise "You can't spend your way out of a recession or a depression." Someone HAS TO to spend to end a recession. There are 3 sources of spending - business, citizens and government...when the first 2 are flat on their back, it leaves only government to inject capital into the economy.
Second, WWII ended the depression...war IS government spending at at HUGE rate.
Third, WHAT would be the consequences if government did nothing? Total collapse of the economy, mass unemployment, loss of all government services like unemployment, police & fire...
It would be total chaos with millions of desperate, starving citizens with no one to enforce the rule of law...
Right wing solutions are fucking great...if ONLY people would evaporate!
During the depression, Republican ideologues then also believed the economy would right itself in the long run, prompting Commerce Secretary Harry Hopkins to respond: People dont eat in the long run. They eat every day.
http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=1&ref=opinion
Yes I will agree with that. But you also must remember that during WW2 the Gov't had a much more productive relationship with businesses than in the 1930s, especially compared to the NRA which lead to the destruction of many small businesses. Some of the New Deal provisions and programs were also being dismantled by Robert Taft and his conservative coalition starting during WW2.
This has turned into a pea brain conversation...
First of all, I dispute the premise "You can't spend your way out of a recession or a depression." Someone HAS TO to spend to end a recession. There are 3 sources of spending - business, citizens and government...when the first 2 are flat on their back, it leaves only government to inject capital into the economy.
Second, WWII ended the depression...war IS government spending at at HUGE rate.
Third, WHAT would be the consequences if government did nothing? Total collapse of the economy, mass unemployment, loss of all government services like unemployment, police & fire...
It would be total chaos with millions of desperate, starving citizens with no one to enforce the rule of law...
Right wing solutions are fucking great...if ONLY people would evaporate!
During the depression, Republican ideologues then also believed the economy would right itself in the long run, prompting Commerce Secretary Harry Hopkins to respond: People dont eat in the long run. They eat every day.
http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=1&ref=opinion
If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
Government spending can only hurt the economy, not help it. Read Bastiat's That Which is Seen, and That Which is Not Seen.
This has turned into a pea brain conversation...
First of all, I dispute the premise "You can't spend your way out of a recession or a depression." Someone HAS TO to spend to end a recession. There are 3 sources of spending - business, citizens and government...when the first 2 are flat on their back, it leaves only government to inject capital into the economy.
Second, WWII ended the depression...war IS government spending at at HUGE rate.
Third, WHAT would be the consequences if government did nothing? Total collapse of the economy, mass unemployment, loss of all government services like unemployment, police & fire...
It would be total chaos with millions of desperate, starving citizens with no one to enforce the rule of law...
Right wing solutions are fucking great...if ONLY people would evaporate!
During the depression, Republican ideologues then also believed the economy would right itself in the long run, prompting Commerce Secretary Harry Hopkins to respond: People dont eat in the long run. They eat every day.
http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=1&ref=opinion
If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
Government spending can only hurt the economy, not help it. Read Bastiat's That Which is Seen, and That Which is Not Seen.
No Kevin...YOU tell me what you and you're IDEOLOGUE will do about PEOPLE that are out of work, out of money, out of shelter and out of food...
Join REALITY...
If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
Government spending can only hurt the economy, not help it. Read Bastiat's That Which is Seen, and That Which is Not Seen.
No Kevin...YOU tell me what you and you're IDEOLOGUE will do about PEOPLE that are out of work, out of money, out of shelter and out of food...
Join REALITY...
Ok, well the reality is that government interventions in the market cause and then worsen economic downturns. So you tell me how that helps people out of work, shelter, money, and food.
No Kevin...YOU tell me what you and you're IDEOLOGUE will do about PEOPLE that are out of work, out of money, out of shelter and out of food...
Join REALITY...
Ok, well the reality is that government interventions in the market cause and then worsen economic downturns. So you tell me how that helps people out of work, shelter, money, and food.
Kevin...reality is TODAY... we could go back to Jefferson and Hamilton's vastly different views of what type of nation we should be, but it will not solve today's human conditions.
AND, are you willing to have America no longer be a world power Kevin?
We never had a true free market since Southern Pacific Railroad vs. the Santa Clara County gave corporations unequal protection under the law...
So YES, government intervention via the Supreme Court set the table for corporate welfare, but what Obama is doing today is absolutely necessary
It seems President Obama has the right approach...
Ok, well the reality is that government interventions in the market cause and then worsen economic downturns. So you tell me how that helps people out of work, shelter, money, and food.
Kevin...reality is TODAY... we could go back to Jefferson and Hamilton's vastly different views of what type of nation we should be, but it will not solve today's human conditions.
AND, are you willing to have America no longer be a world power Kevin?
We never had a true free market since Southern Pacific Railroad vs. the Santa Clara County gave corporations unequal protection under the law...
So YES, government intervention via the Supreme Court set the table for corporate welfare, but what Obama is doing today is absolutely necessary
It seems President Obama has the right approach...
Except history says otherwise.
No Govt. Intervention = 1 year downturn
Massive Govt. Intervention = 15 years of the Great Depression, and Japan's "Lost Decade."
Kevin...reality is TODAY... we could go back to Jefferson and Hamilton's vastly different views of what type of nation we should be, but it will not solve today's human conditions.
AND, are you willing to have America no longer be a world power Kevin?
We never had a true free market since Southern Pacific Railroad vs. the Santa Clara County gave corporations unequal protection under the law...
So YES, government intervention via the Supreme Court set the table for corporate welfare, but what Obama is doing today is absolutely necessary
It seems President Obama has the right approach...
Except history says otherwise.
No Govt. Intervention = 1 year downturn
Massive Govt. Intervention = 15 years of the Great Depression, and Japan's "Lost Decade."
So you're solution is let our economy totally collapse, let people loose their jobs, homes and let them starve and die...then build a new country...
WOW Kevin... Hitler had more compassion...
Except history says otherwise.
No Govt. Intervention = 1 year downturn
Massive Govt. Intervention = 15 years of the Great Depression, and Japan's "Lost Decade."
So you're solution is let our economy totally collapse, let people loose their jobs, homes and let them starve and die...then build a new country...
WOW Kevin... Hitler had more compassion...
You're falling into the Chicken Little trap. The sky wouldn't fall. Things wouldn't be great, but after a year or so we'd be back where we want to be. Now, however, we're just prolonging the agony. So you say I have no compassion because I want to get out of this recession quickly, but the interventions you support are simply making everything worse. So who really has no compassion?
So you're solution is let our economy totally collapse, let people loose their jobs, homes and let them starve and die...then build a new country...
WOW Kevin... Hitler had more compassion...
You're falling into the Chicken Little trap. The sky wouldn't fall. Things wouldn't be great, but after a year or so we'd be back where we want to be. Now, however, we're just prolonging the agony. So you say I have no compassion because I want to get out of this recession quickly, but the interventions you support are simply making everything worse. So who really has no compassion?
Well Kevin, you could be right, BUT the stakes are EXTREMELY high...and IF you ARE wrong, there will be a lot less Americans and possibly no America. The economy in this country was much different in 1921 and 1929. There are just way too many factors to examine to make oversimplified statements...
I'm not willing to put America in the hands of the beliefs of a community college teacher that dedicated his book to Ron Paul.
Many scholars attribute the events that became the Great Depression to Hoover signing the Smoot-Hawley Tariff Act, even though he opposed it...it caused American exports and imports to plunge by more than half.
I am glad Obama is President...I can't imagine where we'd be with McCain in that office.
You're falling into the Chicken Little trap. The sky wouldn't fall. Things wouldn't be great, but after a year or so we'd be back where we want to be. Now, however, we're just prolonging the agony. So you say I have no compassion because I want to get out of this recession quickly, but the interventions you support are simply making everything worse. So who really has no compassion?
Well Kevin, you could be right, BUT the stakes are EXTREMELY high...and IF you ARE wrong, there will be a lot less Americans and possibly no America. The economy in this country was much different in 1921 and 1929. There are just way too many factors to examine to make oversimplified statements...
I'm not willing to put America in the hands of the beliefs of a community college teacher that dedicated his book to Ron Paul.
Many scholars attribute the events that became the Great Depression to Hoover signing the Smoot-Hawley Tariff Act, even though he opposed it...it caused American exports and imports to plunge by more than half.
I am glad Obama is President...I can't imagine where we'd be with McCain in that office.
Community college teacher that dedicated his book to Ron Paul?
Yes, Hoover's interventionism certainly made what might have been a small recession the Great Depression, that's kind of my point.
If McCain were in office I'd guess that he'd be doing the same nonsense that Obama is doing.
Well Kevin, you could be right, BUT the stakes are EXTREMELY high...and IF you ARE wrong, there will be a lot less Americans and possibly no America. The economy in this country was much different in 1921 and 1929. There are just way too many factors to examine to make oversimplified statements...
I'm not willing to put America in the hands of the beliefs of a community college teacher that dedicated his book to Ron Paul.
Many scholars attribute the events that became the Great Depression to Hoover signing the Smoot-Hawley Tariff Act, even though he opposed it...it caused American exports and imports to plunge by more than half.
I am glad Obama is President...I can't imagine where we'd be with McCain in that office.
Community college teacher that dedicated his book to Ron Paul?
Yes, Hoover's interventionism certainly made what might have been a small recession the Great Depression, that's kind of my point.
If McCain were in office I'd guess that he'd be doing the same nonsense that Obama is doing.
Thomas Woods...
Judging by the GOP rhetoric I doubt McCain would do anything but make Bush's tax cuts to the elite permanent...
There would be no GM or Chrysler and 3 - 4 million MORE unemployed...
It would effect the foreign based domestic manufacturing because the demise of GM and Chrysler would mean the demise of MANY suppliers, the SAME suppliers Toyota etc rely on.
The problem is Kevin, unemployed people don't evaporate...they go from tax PAYERS to a burden on the taxpayers...
Community college teacher that dedicated his book to Ron Paul?
Yes, Hoover's interventionism certainly made what might have been a small recession the Great Depression, that's kind of my point.
If McCain were in office I'd guess that he'd be doing the same nonsense that Obama is doing.
Thomas Woods...
Judging by the GOP rhetoric I doubt McCain would do anything but make Bush's tax cuts to the elite permanent...
There would be no GM or Chrysler and 3 - 4 million MORE unemployed...
It would effect the foreign based domestic manufacturing because the demise of GM and Chrysler would mean the demise of MANY suppliers, the SAME suppliers Toyota etc rely on.
The problem is Kevin, unemployed people don't evaporate...they go from tax PAYERS to a burden on the taxpayers...
Do you not remember McCain supporting the initial bailouts? I have no doubt he'd be doing the same things as Obama.
GM and Chrysler are apparently going to end up bankrupt despite our having bailed them out, so that may not be your best example.
No one is saying unemployed people evaporate. But would you rather have a 1 year turnaround or have a 15 year depression? The answer is obvious. Let the market correct itself.
Thomas Woods...
Judging by the GOP rhetoric I doubt McCain would do anything but make Bush's tax cuts to the elite permanent...
There would be no GM or Chrysler and 3 - 4 million MORE unemployed...
It would effect the foreign based domestic manufacturing because the demise of GM and Chrysler would mean the demise of MANY suppliers, the SAME suppliers Toyota etc rely on.
The problem is Kevin, unemployed people don't evaporate...they go from tax PAYERS to a burden on the taxpayers...
Do you not remember McCain supporting the initial bailouts? I have no doubt he'd be doing the same things as Obama.
GM and Chrysler are apparently going to end up bankrupt despite our having bailed them out, so that may not be your best example.
No one is saying unemployed people evaporate. But would you rather have a 1 year turnaround or have a 15 year depression? The answer is obvious. Let the market correct itself.
Kevin...the choice would be obvious, but I guess what I say goes in one ear and out the other...because you are assuming a LOT...you are putting all your faith in what is probably partisan spin on something that happened in 1921. IF the solution were THAT simple, then it wouldn't be obscure history or debated here. It is conjecture from ideologues...
HOW is the "market" going to correct itself Kevin...explain the mechanics...
IMO, President Obama is on the right track going after lobbyists and special interests... they are the ones that have rigged the "market" in their favor to the detriment of you, me and the American people...
Yes I will agree with that. But you also must remember that during WW2 the Gov't had a much more productive relationship with businesses than in the 1930s, especially compared to the NRA which lead to the destruction of many small businesses. Some of the New Deal provisions and programs were also being dismantled by Robert Taft and his conservative coalition starting during WW2.
This has turned into a pea brain conversation...
First of all, I dispute the premise "You can't spend your way out of a recession or a depression." Someone HAS TO to spend to end a recession. There are 3 sources of spending - business, citizens and government...when the first 2 are flat on their back, it leaves only government to inject capital into the economy.
Second, WWII ended the depression...war IS government spending at at HUGE rate.
Third, WHAT would be the consequences if government did nothing? Total collapse of the economy, mass unemployment, loss of all government services like unemployment, police & fire...
It would be total chaos with millions of desperate, starving citizens with no one to enforce the rule of law...
Right wing solutions are fucking great...if ONLY people would evaporate!
During the depression, Republican ideologues then also believed the economy would right itself in the long run, prompting Commerce Secretary Harry Hopkins to respond: “People don’t eat in the long run. They eat every day.”
http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=1&ref=opinion
If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
Government spending can only hurt the economy, not help it. Read Bastiat's That Which is Seen, and That Which is Not Seen.
This has turned into a pea brain conversation...
First of all, I dispute the premise "You can't spend your way out of a recession or a depression." Someone HAS TO to spend to end a recession. There are 3 sources of spending - business, citizens and government...when the first 2 are flat on their back, it leaves only government to inject capital into the economy.
Second, WWII ended the depression...war IS government spending at at HUGE rate.
Third, WHAT would be the consequences if government did nothing? Total collapse of the economy, mass unemployment, loss of all government services like unemployment, police & fire...
It would be total chaos with millions of desperate, starving citizens with no one to enforce the rule of law...
Right wing solutions are fucking great...if ONLY people would evaporate!
During the depression, Republican ideologues then also believed the economy would right itself in the long run, prompting Commerce Secretary Harry Hopkins to respond: People dont eat in the long run. They eat every day.
http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=1&ref=opinion
If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
Government spending can only hurt the economy, not help it. Read Bastiat's That Which is Seen, and That Which is Not Seen.
The 1920 recession was totally different than 1929, or 2008.
The 1920 recession was a post war recession, as industry de-tooled from the production of WWI and tooled back up for domestic production. It was not a recession characterized by massive asset price deflations, bank failures, panic and fear with the associate hoarding of money. 1920 was very minor and as industry tooled back into domestic production, the economy went back on its way.
1929 was a totally different creature. The crashing stock market wiped out huge sums of wealth and panic gripe the nations as runs made on banks caused them to fail. People hoarded their money, didn't spend, and to maintain the gold standards, the Fed had to raise interest rates in 1930 making credit even tighter. A spiral of fear ensued as more fear and panic led to less credit, less spending, less production, and then more unemployment starting another round of the downward cycle.
Other than foolishly raise tarriffs and the Fed raising the intererst rates, the Govt did marginal intervention for three years as the spiral continued, wiping out 40% of economic production and putting 25% of the labor force out of work.
2008 is a lot more like 1929 than 1920. This is no postwar retooling recession, but a financial catastrophe caused by wholesale miscalculation of riks associated with mortgage investments. Like the great depression, it has caused a major freeze in the credit markets, and without the financial bailout, would have brought down the biggest financial institutions that unfortunately dominate the financial markets which would have lead to a catastrophe that would cost a lot more than the money being spent now.
Risking our financial system and economy on a misplaced comparison to a completely different type of economic phenonema would be foolishly risky, from what I see of it.
If its true that we need our great and benevolent government to step in and save us from any economic downturn, that they caused by the way, then why did the recession of 1920 only last until the middle of 1921 when neither the Federal Reserve nor the federal government stepped in to spend our way out of it?
Government spending can only hurt the economy, not help it. Read Bastiat's That Which is Seen, and That Which is Not Seen.
The 1920 recession was totally different than 1929, or 2008.
The 1920 recession was a post war recession, as industry de-tooled from the production of WWI and tooled back up for domestic production. It was not a recession characterized by massive asset price deflations, bank failures, panic and fear with the associate hoarding of money. 1920 was very minor and as industry tooled back into domestic production, the economy went back on its way.
1929 was a totally different creature. The crashing stock market wiped out huge sums of wealth and panic gripe the nations as runs made on banks caused them to fail. People hoarded their money, didn't spend, and to maintain the gold standards, the Fed had to raise interest rates in 1930 making credit even tighter. A spiral of fear ensued as more fear and panic led to less credit, less spending, less production, and then more unemployment starting another round of the downward cycle.
Other than foolishly raise tarriffs and the Fed raising the intererst rates, the Govt did marginal intervention for three years as the spiral continued, wiping out 40% of economic production and putting 25% of the labor force out of work.
2008 is a lot more like 1929 than 1920. This is no postwar retooling recession, but a financial catastrophe caused by wholesale miscalculation of riks associated with mortgage investments. Like the great depression, it has caused a major freeze in the credit markets, and without the financial bailout, would have brought down the biggest financial institutions that unfortunately dominate the financial markets which would have lead to a catastrophe that would cost a lot more than the money being spent now.
Risking our financial system and economy on a misplaced comparison to a completely different type of economic phenonema would be foolishly risky, from what I see of it.
The same principle applies. You need to allow the market to correct itself, which as we saw in 1920 - 1921, is clearly the correct answer.
The 1920 recession was totally different than 1929, or 2008.
The 1920 recession was a post war recession, as industry de-tooled from the production of WWI and tooled back up for domestic production. It was not a recession characterized by massive asset price deflations, bank failures, panic and fear with the associate hoarding of money. 1920 was very minor and as industry tooled back into domestic production, the economy went back on its way.
1929 was a totally different creature. The crashing stock market wiped out huge sums of wealth and panic gripe the nations as runs made on banks caused them to fail. People hoarded their money, didn't spend, and to maintain the gold standards, the Fed had to raise interest rates in 1930 making credit even tighter. A spiral of fear ensued as more fear and panic led to less credit, less spending, less production, and then more unemployment starting another round of the downward cycle.
Other than foolishly raise tarriffs and the Fed raising the intererst rates, the Govt did marginal intervention for three years as the spiral continued, wiping out 40% of economic production and putting 25% of the labor force out of work.
2008 is a lot more like 1929 than 1920. This is no postwar retooling recession, but a financial catastrophe caused by wholesale miscalculation of riks associated with mortgage investments. Like the great depression, it has caused a major freeze in the credit markets, and without the financial bailout, would have brought down the biggest financial institutions that unfortunately dominate the financial markets which would have lead to a catastrophe that would cost a lot more than the money being spent now.
Risking our financial system and economy on a misplaced comparison to a completely different type of economic phenonema would be foolishly risky, from what I see of it.
The same principle applies. You need to allow the market to correct itself, which as we saw in 1920 - 1921, is clearly the correct answer.
We saw how clearly correct that answer was in 1929.
We've discussed this before. I don't share you let the economy go down the toilet philosophy. Maybe they do at Mises.
The same principle applies. You need to allow the market to correct itself, which as we saw in 1920 - 1921, is clearly the correct answer.
We saw how clearly correct that answer was in 1929.
We've discussed this before. I don't share you let the economy go down the toilet philosophy. Maybe they do at Mises.
No, we didn't. Hoover and FDR were interventionists.
I don't share your "Let's make the situation worse so everybody can suffer for longer" philosophy. Maybe Paul Krugman does.
We saw how clearly correct that answer was in 1929.
We've discussed this before. I don't share you let the economy go down the toilet philosophy. Maybe they do at Mises.
No, we didn't. Hoover and FDR were interventionists.
I don't share your "Let's make the situation worse so everybody can suffer for longer" philosophy. Maybe Paul Krugman does.
You'd have a point, if the stimulus bill caused the credit freeze, mortgage crash, and recession. That stuff all happened before there was any thought of a stimulus bill.
actually, it is supported by the facts
you just refuse to admit it because it doesnt fit your political agenda
Okay, it was your assertion, so it's up to you to prove it.
What was the level of debt racked up by the consuming class in 1929?
What percentage of the GDP could be attributed to consumer debt?
How does that compare to todays debt ratios?back then they could buy stock with only 10% secured funding
the other 90% was borrowed
it wasnt so much the consumer class as the investor class
thats what you either forget or are willfully ignoring
In other words you just agreed with what I'd originally said...that the debt load of consumers was not the cause of the depression.
Okay fine we agree.
and my post was refering to today, not 1929
but, almost the same thing happened today with people buying beyond their means to repay
This thread is about the 1929 depression
but go ahead and completely ignore those facts
Try making your point clearly next time, then.
