The Great Depression - why did it end?

[manu1959]

whitch just like the last time you posted it, doesnt prove your point, it proves everyone elses

But, SHE DOESN'T GET IT! FDR takes office, unemployment soars. Even by '42, a year after US enters war; 3 years after production of war related goods started, unemployment is STILL HIGHER than when he took office! That's with hundreds of thousands of young men unavailable to work!

That's not what I see in those stats. FDR took office at the peak of unemployment, in 1933, at almost 25%. Things improved from there, for whatever reason, until 1938, but unemployment did not become normal again until around 1942. Keep in mind that I am undecided on this issue.

So what country and in what era (doesn't have to be the 30s), handled a depression the best?

or you could read the stats as .....

as it became obvious that fdr would be president business started to freak out then fdr passed a bunch of programs that made things worse.......then we went to war and things got better.....

sound familiar

 

[manu1959]

That's not what I see in those stats. FDR took office at the peak of unemployment, in 1933, at almost 25%. Things improved from there, for whatever reason, until 1938, but unemployment did not become normal again until around 1942. Keep in mind that I am undecided on this issue.

So what country and in what era (doesn't have to be the 30s), handled a depression the best?

or you could read the stats as .....

as it became obvious that fdr would be president business started to freak out then fdr passed a bunch of programs that made things worse.......then we went to war and things got better.....

sound familiar

FDR was elected in late 1932. The stock market crashed in 1929. FDR's election does, in some ways, sound familiar though:

Hoover's attempts to campaign in public were a disaster, as he often had objects (especially rotten fruit and vegetables) thrown at him or his vehicle as he rode through city streets. In his addresses, Hoover attacked Roosevelt as a dangerous radical who would only make the Depression worse by raising taxes and increasing the federal debt to pay for expensive welfare and social-relief programs. However, with unemployment at 23.6%,[1][2] Hoover's criticisms of the New Deal plan did nothing more than further lower his popularity with the public and it was said that "Even a vaguely talented dog-catcher could have been elected president against the Republicans..."

United States presidential election, 1932 - Wikipedia, the free encyclopedia

go read some of hoovers polices and tell me they don't sound like some of obama's...

 

[Kevin_Kennedy]

Why Not the Gold Standard?

The Case for Genuine Gold Dollar

 

[LiveUninhibited]

go read some of hoovers polices and tell me they don't sound like some of obama's...

That's interesting since Hoover was a Republican. Which policies specifically would you point to that were problematic?

I had also asked if anybody could point to where a depression was handled well in any country at any time. Is there none?

 

[Kevin_Kennedy]

go read some of hoovers polices and tell me they don't sound like some of obama's...

I had also asked if anybody could point to where a depression was handled well in any country at any time. Is there none?

1920 - 1921 in the United States. There was a recession that was allowed to correct itself, and it only lasted for about a year.

 

[LiveUninhibited]

or you could read the stats as .....

as it became obvious that fdr would be president business started to freak out then fdr passed a bunch of programs that made things worse.......then we went to war and things got better.....

sound familiar

Another thing I don't get about this line of reasoning is why would going to war pull you out of a depression if spending money on improving infrastructure does not? Both represent an expansion of the public sector but for different purposes.

 

[Kevin_Kennedy]

or you could read the stats as .....

as it became obvious that fdr would be president business started to freak out then fdr passed a bunch of programs that made things worse.......then we went to war and things got better.....

sound familiar

Another thing I don't get about this line of reasoning is why would going to war pull you out of a depression if spending money on improving infrastructure does not? Both represent an expansion of the public sector but for different purposes.

Going to war does not pull you out of a depression or a recession. War is always destructive to the economy.

 

[DiveCon]

or you could read the stats as .....

as it became obvious that fdr would be president business started to freak out then fdr passed a bunch of programs that made things worse.......then we went to war and things got better.....

sound familiar

Another thing I don't get about this line of reasoning is why would going to war pull you out of a depression if spending money on improving infrastructure does not? Both represent an expansion of the public sector but for different purposes.

Going to war does not pull you out of a depression or a recession. War is always destructive to the economy.

actually, it does
because the government spends money on an actual product
and not just throwing it down a money hole

 

[LiveUninhibited]

Another thing I don't get about this line of reasoning is why would going to war pull you out of a depression if spending money on improving infrastructure does not? Both represent an expansion of the public sector but for different purposes.

Going to war does not pull you out of a depression or a recession. War is always destructive to the economy.

actually, it does
because the government spends money on an actual product
and not just throwing it down a money hole

I suppose the struggle of war can, at great cost, yield new technologies originally meant for the battlefield that also help civilians afterwards. For example, medical technology often takes leaps forward during conflicts.

I would agree that public money needs to be carefully spent on things that are useful instead of "throwing money down a hole." If a stimulus today were to help us get off of foreign oil while providing jobs, that would be a good use of public money it seems. Weatherizing buildings is quite literally a band-aid sort of approach. I'm disappointed there wasn't money for nuclear power.

 

[DiveCon]

Going to war does not pull you out of a depression or a recession. War is always destructive to the economy.

actually, it does
because the government spends money on an actual product
and not just throwing it down a money hole

I suppose the struggle of war can, at great cost, yield new technologies originally meant for the battlefield that also help civilians afterwards. For example, medical technology often takes leaps forward during conflicts.

I would agree that public money needs to be carefully spent on things that are useful instead of "throwing money down a hole." If a stimulus today were to help us get off of foreign oil while providing jobs, that would be a good use of public money it seems. Weatherizing buildings is quite literally a band-aid sort of approach. I'm disappointed there wasn't money for nuclear power.

exactly, which is why that porkulous bill wont do anything to fix the economy
its just throwing money down a hole
like how is studying pig shit gonna help the economy?

 

[DiveCon]

if you buy a tank, it creates jobs for everyone from the guys that actually build it to the people that supply them
also creates a profit for that business owner for which he pays taxes on
all those involved also pay taxes and spend that money creating yet more jobs

 

[Kevin_Kennedy]

if you buy a tank, it creates jobs for everyone from the guys that actually build it to the people that supply them
also creates a profit for that business owner for which he pays taxes on
all those involved also pay taxes and spend that money creating yet more jobs

Frédéric Bastiat talked about what is seen, and what is unseen. When the government spends money on a war you can see the tanks, the missiles, and everything else produced to fight that war. But what remains unseen is what that money would have been spent on had there been no war, in other words what it was meant to be spent on. How many jobs were destroyed because that money was spent on the war? The same concepts apply to war spending as they do to any other government spending, because the government always has to take that money out of the private sector. Thus hurting the economy.

"War prosperity is like the prosperity that an earthquake or a plague brings." - Ludwig von Mises

 

[LiveUninhibited]

if you buy a tank, it creates jobs for everyone from the guys that actually build it to the people that supply them
also creates a profit for that business owner for which he pays taxes on
all those involved also pay taxes and spend that money creating yet more jobs

Jobs are certainly the number one concern. People need to be working to be able to participate in the economy constructively. However, whether their efforts go towards constructive ends is a not-so-distant second concern. When you're producing a tank to defend your country, that may be necessary, but not as ideal as producing a car that will transport a worker, or paving a freeway that will make travel safer and more efficient, or building a dam that will provide power instead of transferring more wealth to oil-producing nations.

Jobs can be created by the government or private entities. Conservatives often say that when liberal fiscal policies are implemented, private sources of jobs will dry up. While that is clearly possible, how do you differentiate between that and when consumers are simply refusing to spend money due to real or imagined threats to their economic viability?

 

[garyd]

Clown the CCC was found Unconstitutional by the Supreme Court in 1934 as was most of the rest of the 1st hundred Days legislation. In 1937 with the replacement of two or three justices on SCOTUS. It was repassed as the WPA. And programs like that was the only reason unemployemnt post 1937. showed any decline at all prior to WWII. IE if you include those doing WPA Jobs with the unemployed unemployment did not fall at all. Until WWII when Roosevelt was compelled to pump money into the private sector rather than the Public the economy went Flat or dropped like a stone whenever the New Dealers got thier way and began to recover whenever they were prempted by SCOTUS in early 34 or by WWII in 1941.

The difference sir was in where the money was spent not the quantity of it. Obama and the Dems are making by and large the same mistakes Roosevelt did prior to 1939. He's putting way to much money into government and not enough into the private sector.

Kevin, Bastiat missed two things in that analysis. 1st The Great Depression was an almost unique event historically. Hence in this case there were no jobs destroyed in the US because of the War, and a good many were created by it. 2nd the chief accomplishment of WWII was that it changed the psychological balance of the country. We suddenly had something worse to worry about than how many people were out of work. I don't think it would have worked at any other time in History nor do I think that it would work now.

 

[DiveCon]

if you buy a tank, it creates jobs for everyone from the guys that actually build it to the people that supply them
also creates a profit for that business owner for which he pays taxes on
all those involved also pay taxes and spend that money creating yet more jobs

Frédéric Bastiat talked about what is seen, and what is unseen. When the government spends money on a war you can see the tanks, the missiles, and everything else produced to fight that war. But what remains unseen is what that money would have been spent on had there been no war, in other words what it was meant to be spent on. How many jobs were destroyed because that money was spent on the war? The same concepts apply to war spending as they do to any other government spending, because the government always has to take that money out of the private sector. Thus hurting the economy.

"War prosperity is like the prosperity that an earthquake or a plague brings." - Ludwig von Mises

hey, its better than studying pig shit

 

[Old Rocks]

if you buy a tank, it creates jobs for everyone from the guys that actually build it to the people that supply them
also creates a profit for that business owner for which he pays taxes on
all those involved also pay taxes and spend that money creating yet more jobs

That is fucking stupid. If you buy a tank, you have a product that is only good for destruction, and will be obsolete and useful only as scrap iron in about 10 years. If you build a bridge where needed, you have created infrastructure that will last at least two generations, possibly five, and will enhance the economy of the region for that period.

If you build a new energy grid, you will create a process that will build on itself. And it will be constructive, not destructive.

 

[Old Rocks]

Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. This world in arms is not spending money alone. It is spending the sweat of its laborers, the genius of its scientists, the hopes of its children. The cost of one modern heavy bomber is this: a modern brick school in more than 30 cities. It is two electric power plants, each serving a town of 60,000 population. It is two fine, fully equipped hospitals. It is some fifty miles of concrete pavement. We pay for a single fighter plane with a half million bushels of wheat. We pay for a single destroyer with new homes that could have housed more than 8,000 people. This is, I repeat, the best way of life to be found on the road the world has been taking. This is not a way of life at all, in any true sense. Under the cloud of threatening war, it is humanity hanging from a cross of iron. ... Is there no other way the world may live?

 

[glockmail]

Every gun that is made, every warship launched, every rocket fired signifies, in the final sense, a theft from those who hunger and are not fed, those who are cold and are not clothed. ...

This is an obvious admission that you don't have a clue about basic economics, a basic liberal trait.

 

[Yukon]

As I stated earlier it was Adolph Hitler who ended the Great Depression by attacking Poland.

 

[editec]

The relatively feeble stimulus spending before WWII had some positive effects on the economy, but more importantly it helped a lot of American PEOPLE weather that economic storm.

But the massive spending of WWII was the stimulant which really got things going. And that was pretty much all done by taking on DEBT.

In both cases, notice the government is spending the money and notice that the nation was borrowing it, then, too.

When there is a shortage of money in circulation, when consumers and businesses have lost confidence, money needs to be injected into the system.

If it is not, then the vicious cycle of DEflation continues unabated: people don't spend because they fear for their jobs, businesses lay off people, because people aren't spending, the umeployed cannot spend, those with money see that the economy is still fibrilating, and they hoarde their dough...

Right now we're still in that vicious cycle of money being hoarded and not circulating.

People are not buying stuff because they are fearful.

Getting some people working again (those people who WILL spend their money because they have no choice) will prime the pump of the economy.

Inflation (or higher taxes to pay off the debts) is the likely outcome that will happen (as happened post WWII) once the economy has recovered.