The Harding Plan: Cut spending and Get Out of the Way.

Discussion in 'Clean Debate Zone' started by Jackson, Sep 24, 2012.

  1. Jackson
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    Jackson Gold Member Supporting Member

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    Thomas Sowell

    An Economic 'Plan'?


    1. Former president Bill Clinton told the Democratic National Convention that Barack Obama has a plan to rescue the economy, and only the fact that the Republicans stood in his way has stopped him from getting the economy out of the doldrums.

    2. From all this, and much else that is said in the media and on the campaign trail, you might think that the economy requires government intervention to revive and create jobs. It is Beltway dogma that the government has to "do something."

    3 History tells a different story. For the first 150 years of this country's existence, the federal government felt no great need to "do something" when the economy turned down.

    Over that long span of time, the economic downturns were neither as deep nor as long lasting as they have been since the federal government decided that it had to "do something" in the wake of the stock market crash of 1929, which set a new precedent.

    4. One of the last of the "do nothing" presidents was Warren G. Harding. In 1921, under President Harding, unemployment hit 11.7 percent -- higher than it has been under President Obama. Harding did nothing to get the economy stimulated. [/B

    5. ]Far from spending more money to try to "jump start" the economy, President Harding actually reduced government spending, as the tax revenues declined during the economic downturn.

    6. The 11.7 percent unemployment rate in 1921 fell to 6.7 percent in 1922, and then to 2.4 percent in 1923. It is hard to think of any government intervention in the economy that produced such a sharp and swift reduction in unemployment as was produced by just staying out of the way and letting the economy rebound on its own.

    7. Something similar happened under Ronald Reagan. Unemployment peaked at 9.7 percent early in the Reagan administration. Like Harding and earlier presidents, Reagan did nothing, despite outraged outcries in the media.

    8 The economy once again revived on its own. Three years later, unemployment was down to 7.2 percent -- and it kept on falling, as the country experienced twenty years of economic growth with low inflation and low unemployment.

    An Economic 'Plan'? - Thomas Sowell - Page 1

    The Harding Plan: Cut spending and Get Out of the Way.
     
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  2. CrusaderFrank
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    CrusaderFrank Diamond Member

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    This is why I laugh when people tell me how "great" FDR was
     
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  3. regent
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    regent Gold Member

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    Both historians, and the people that lived through the Great Depression, indicate that FDR was great. The people voted for FDR four times in a row, and the historians have never rated FDR less than one of the three greatest presidents, and recently, as America's greatest.
     
  4. auditor0007
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    auditor0007 Gold Member

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    Just a few problems with all of this. First of all, Harding doing nothing and letting capitalism run wild with basically no controls at all led us right into the stock market crash and the Great Depression. This was not a good thing.

    As for Reagan not doing anything, are you serious? First he cut taxes, which wasn't such a bad thing, because they were a bit high at the time. But then he saw that he cut them too much, so he actually raised them again, but not to the same levels as before cutting them. Keep this in mind; during Reagan's first term, unemployment remained pretty high, but government revenues exceeded 19% of GDP, 4% more than we have had since this economic downturn began. Because of Reagan having plenty of government revenues, he was able to expand government, which also helped create jobs and reduce unemployment. Under Obama, because revenues have been so low, we have lost nearly 700,000 government jobs at all levels.

    Last of all, much of the recession Reagan faced was due to keeping inflation under control. Paul Volker had interest rates so high during Reagan's first term, that economic growth had come to a halt. By Reagan's second term, inflation was well on it's way to being under control and interest rates began to fall, although they were still high compared to today's rates. Of course, as interest rates fell, business was more easily able to borrow money, and the economy began to take off, and of course then unemployment fell as companies began to expand.

    These are all very different situations than what we face today.
     
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  5. CrusaderFrank
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    CrusaderFrank Diamond Member

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    FDR was a great failure, he oversaw an economy worse than the 7 Biblical leans years. His Soviet style central planning and hatred of business stifled economic activity in the USA.
     
  6. CrusaderFrank
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    CrusaderFrank Diamond Member

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    The Fed caused the crash and started the FDR Depression.
     
  7. Avorysuds
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    Avorysuds Gold Member

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    Yes, people think welfare is great... People that lived under FDR might have had nothing and been starving but my gawd FDR was spending like a King!!!

    FDR was one of if not the worst President in US history, he vastly prolonged the depression much as Obama has prolonged this recession. “Historians” are nothing but people with opinions, nothing more… Facts speak louder than partisanship, and the fact is FDR ran this country into the ground, destroying tens of millions of people’s lives. Everyone votes for welfare Presidents, that’s why both parties have shifted so far to the left when it comes to polc8ies yet both jump far right when talking about spending. Oddly only massive spending occurs, never the cuts in spending.


    Thankfully they cut spending and lowered taxes after that fucking Dictator FDR died.
     
  8. auditor0007
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    auditor0007 Gold Member

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    The lack of regulation governing how stocks could be purchased was the major factor in the crash. Most stocks were being bought on margin, up to 90% margin, meaning investors, including the banks, only put up 10% to purchase stock. When the market crashed, not only was the value of the stock lost, all the margin buyers still owed the 90% they had borrowed. None of that money was there to begin with, so it could never be paid back. This led to the liquidation of one bank after another, and since regular American's deposits weren't covered by any type of insurance like the FDIC, even people who had money all of a sudden had none, because it went with the banks.
     
  9. rightwinger
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    rightwinger Paid Messageboard Poster Gold Supporting Member Supporting Member

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    Harding was one of our most corrupt and inept presidents in history
     
  10. JakeStarkey
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    JakeStarkey Diamond Member Supporting Member

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    Harding may have been murdered by his wife for inept and dangerous economic policies.
     

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