bigrebnc1775
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The only difference between hitler and FDR was FDR did not try to exterminate anyone, he did however have Americans locked up
Top 3 Myths About the Great Depression and the New Deal
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The only difference between hitler and FDR was FDR did not try to exterminate anyone, he did however have Americans locked up
bigrebnc1775
][][][% NC Sheepdog
- Thread starter
- #282
Silence?
Contumacious
Radical Freedom
Tell us where in history has socialism/communism produced the results you claim?
Contumacious
Radical Freedom
Tell us where in history has socialism/communism produced the results you claim?
FireFly
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Obama is your hero & YOU WILL VOTE FOR HIM AGAIN!!!!!!
Toro
Diamond Member
bigrebnc1775
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All I can say is Joe Kennedy.
KissMy
Free Breast Exam
The War & Broken Window Fallacy is for the indoctrinated dopes.
This may be what they teach in economics but it is dead wrong. It takes away more than it stimulates. If a 30 year window that still had 15 years of good service life remaining was destroyed, then we lost. The money spent to replace that window was pulled from the owners investments that was leveraged 10 to 1 creating jobs. Now 10 new higher level jobs are not created & an established window installer makes a few bucks. A new 30 year window will be placed in the series of remaining windows that will all be replaced again in 15 years. Also broken windows lead to lost business. Customers, surrounding business & community feels depressed, less secure & relocate to safer communities. Broken windows lead to increased crime, fewer jobs & lost opportunities. Study - Police Broken windows theory
The shop owner & the surrounding community becomes somewhat depressed after an incident. Depressed people do not stimulate the economy. They stop spending & begin nesting. Just look at what happened to the economy after 9/11. The Fed had to over stimulate a housing bubble to get the economy to start moving again.
To take my point further. People claim that WWII brought the US out of the Depression. (talk about a bunch of broken stuff) Well Bush started 2 wars after 9/11 & the recovery effects on the economy are not there. The US recovery from the Great Depression started with us selling the allies military hardware, supplies & weapons. This stimulus would have ended with the war & then the economy would have crashed again.
It was the VICTORIOUS SPIRIT citizens felt that lifted fallen nations & the millions of women telling the returning hero's HONEY I'M PREGNANT millions of times over that kept the economy rolling!!! Nothing creates 60 years continuous joyous demand like babies. They needed new clothes, beds, bigger houses, bigger cars, more toys, food, medical, etc. Animal Spirits drive the economy. The current Mid-East wars may have depressed those spirits. We have not had the victorious attitude from these wars or a baby boom. Now the "Boomer's" who made the economy rise in the 40's are becoming a drag on the economy.
Japan's massive earth quake/tsunami/nuclear disaster caused a lot of "Broken Window" spending on rebuilding. Even though the Japanese people have been saving like crazy for the past 20 years because of a debt crisis similar to our current one the BW theory has not made them permanently crack open their wallets & spend their way to prosperity. As a matter of fact their economy is not roaring, it is depressed.
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bigrebnc1775
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I agree
Shellback
Member
You really didn't just prop up wiki as a credible source, did you? Know what happens if you cite wiki, in a real debate? You get laughed at. The site of user-input information, holds the bias of those inputting. wiki has a DEFINITE left-wing bias and a history of misinformation.
bripat9643
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What "impacts?" FDR was trying to reduce agricultural production to jack up the price of meat and produce. The dust bowl should have been beneficial to FDR's program according to the goose stepping Keynesian wack-doodles.
bripat9643
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According to the theories FDR and his apologists believe in, the dust bowl should have helped end the depression by increasing the price of agricultural products.
No cigar.
bripat9643
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Yeah, and the Bush family financed the Nazis.
The lies never stop when the libs are defending the undefendable.
Contumacious
Radical Freedom
A democracy cannot exist as a permanent form of government. It can only exist until the voters discover that they can vote themselves money from the public treasury. From that moment on, the majority always votes for the candidates promising the most money from the public treasury, with the result that a democracy always collapses over loose fiscal policy ….”
Alexander Tyler
.
FireFly
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Your public school indoctrination has mislead you. GOVERNMENT CAUSED THE GREAT DEPRESSION!!!
At their peak, stocks in the Dow Jones Industrial Average were selling for 19 times earnings - somewhat high, but hardly what stock market analysts regard as a sign of inordinate speculation. The distortions in the economy promoted by the Fed's monetary policy had set the country up for a recession, but other impositions to come would soon turn the recession into a full-scale disaster. As stocks took a beating, Congress was playing with fire: On the very morning of Black Thursday, the nation's newspapers reported that the political forces for higher trade-damaging tariffs were making gains on Capitol Hill.
The stock market crash was only a reflection - not the direct cause - of the destructive government policies that would ultimately produce the Great Depression. The market rose and fell in almost direct synchronization with what the Fed and Congress were doing. And what they did in the 1930s ranks way up there in the annals of history's greatest follies.
There was already a long history of margin lending on stock exchanges, and margin requirements (the share of the purchase price paid in cash) were no lower in the late twenties than in the early twenties or in previous decades. In fact, in the fall of 1928 margin requirements began to rise, and borrowers were required to pay a larger share of the purchase price of the stocks.
The free market excess margin lending argument doesn't hold much water. Government intervention with money, credit supply, trade & labor, however, is another story.
The government inflated the money and credit supply, interest rates fell. Businesses invested this "easy money" in new production projects and a boom took place. As the boom matured, business costs rose, interest rates readjust upward, and profits were squeezed. The easy-money effects thus wear off and the Fed's monetary authorities, fearing price inflation, contracted, the money supply. In either case, the governments manipulation was enough to tank the economy.
Using a broad measure that includes currency, demand and time deposits, and other ingredients, the Fed bloated the money supply by more than 60 percent from 1916 to 1928. This expansion of money and credit drove interest rates down, pushed stocks, & asset prices to dizzy heights which gave birth to the "Roaring Twenties. Then by 1929, the Federal Reserve was raising interest rates and choking off the money supply until 1933.
The crowning folly of government intervention was the Smoot-Hawley Tariff, passed in June 1930. It was the most protectionist legislation in U.S. history. It virtually closed the borders and ignited a vicious international trade war. This put American business & agriculture into a tailspin for the preceding decade.
With a stroke of the presidential pen, farmers in this country lost nearly a third of their markets. Grain prices plummeted by 70% & tens of thousands of farmers went bankrupt. This created un-planted, fallow & neglected farms that caused the "Dust Bowl" which further destroyed the economy. With the collapse of agriculture, rural banks failed in record numbers, dragging down hundreds of thousands of their customers. Nine thousand banks closed their doors in the United States between 1930 and 1933. The stock market, which had regained much of the ground it had lost since the previous October, tumbled on the day Hoover signed Smoot-Hawley into law, and fell almost without respite for the next two years.
The Smoot-Hawley Tariffs by itself should lay to rest the myth that Hoover was a free market practitioner. Hoover's "high-wage" policy & the trade unions succeeded only in pricing workers out of the labor market, generating an increasing circle of unemployment. His Reconstruction Finance Corporation ladled out billions more in business & farm subsidies.
Hoover signed the Revenue Act of 1932. The largest tax increase in peacetime history, it doubled the income tax. The top bracket soared from 24 percent to 63 percent. Exemptions were lowered; the earned income credit was abolished; corporate and estate taxes were raised; new gift, gasoline and auto taxes were imposed; and postal rates were sharply hiked. Hoover even taxed bank checks, which accelerated the decline in the multiplier of available money & slowed the velocity of money by penalizing people for writing checks.
In the space of one year alone, from 1930 to 1931, under Hoover the federal government's share of GNP soared from 16.4 percent to 21.5 percent. Can any serious scholar observe the Hoover administration's massive economic intervention and, with a straight face, pronounce the inevitably deleterious effects as the fault of free markets?
The shrinkage in world trade brought on by the tariff wars helped set the stage for World War-II a few years later. When tariffs made it nearly impossible for foreign businessmen to sell their goods in American markets, the burden of their debts became massively heavier and emboldened demagogues like Adolf Hitler. "When goods don't cross frontiers, armies will".
At their peak, stocks in the Dow Jones Industrial Average were selling for 19 times earnings - somewhat high, but hardly what stock market analysts regard as a sign of inordinate speculation. The distortions in the economy promoted by the Fed's monetary policy had set the country up for a recession, but other impositions to come would soon turn the recession into a full-scale disaster. As stocks took a beating, Congress was playing with fire: On the very morning of Black Thursday, the nation's newspapers reported that the political forces for higher trade-damaging tariffs were making gains on Capitol Hill.
The stock market crash was only a reflection - not the direct cause - of the destructive government policies that would ultimately produce the Great Depression. The market rose and fell in almost direct synchronization with what the Fed and Congress were doing. And what they did in the 1930s ranks way up there in the annals of history's greatest follies.
There was already a long history of margin lending on stock exchanges, and margin requirements (the share of the purchase price paid in cash) were no lower in the late twenties than in the early twenties or in previous decades. In fact, in the fall of 1928 margin requirements began to rise, and borrowers were required to pay a larger share of the purchase price of the stocks.
The free market excess margin lending argument doesn't hold much water. Government intervention with money, credit supply, trade & labor, however, is another story.
The government inflated the money and credit supply, interest rates fell. Businesses invested this "easy money" in new production projects and a boom took place. As the boom matured, business costs rose, interest rates readjust upward, and profits were squeezed. The easy-money effects thus wear off and the Fed's monetary authorities, fearing price inflation, contracted, the money supply. In either case, the governments manipulation was enough to tank the economy.
Using a broad measure that includes currency, demand and time deposits, and other ingredients, the Fed bloated the money supply by more than 60 percent from 1916 to 1928. This expansion of money and credit drove interest rates down, pushed stocks, & asset prices to dizzy heights which gave birth to the "Roaring Twenties. Then by 1929, the Federal Reserve was raising interest rates and choking off the money supply until 1933.
The crowning folly of government intervention was the Smoot-Hawley Tariff, passed in June 1930. It was the most protectionist legislation in U.S. history. It virtually closed the borders and ignited a vicious international trade war. This put American business & agriculture into a tailspin for the preceding decade.
With a stroke of the presidential pen, farmers in this country lost nearly a third of their markets. Grain prices plummeted by 70% & tens of thousands of farmers went bankrupt. This created un-planted, fallow & neglected farms that caused the "Dust Bowl" which further destroyed the economy. With the collapse of agriculture, rural banks failed in record numbers, dragging down hundreds of thousands of their customers. Nine thousand banks closed their doors in the United States between 1930 and 1933. The stock market, which had regained much of the ground it had lost since the previous October, tumbled on the day Hoover signed Smoot-Hawley into law, and fell almost without respite for the next two years.
The Smoot-Hawley Tariffs by itself should lay to rest the myth that Hoover was a free market practitioner. Hoover's "high-wage" policy & the trade unions succeeded only in pricing workers out of the labor market, generating an increasing circle of unemployment. His Reconstruction Finance Corporation ladled out billions more in business & farm subsidies.
Hoover signed the Revenue Act of 1932. The largest tax increase in peacetime history, it doubled the income tax. The top bracket soared from 24 percent to 63 percent. Exemptions were lowered; the earned income credit was abolished; corporate and estate taxes were raised; new gift, gasoline and auto taxes were imposed; and postal rates were sharply hiked. Hoover even taxed bank checks, which accelerated the decline in the multiplier of available money & slowed the velocity of money by penalizing people for writing checks.
In the space of one year alone, from 1930 to 1931, under Hoover the federal government's share of GNP soared from 16.4 percent to 21.5 percent. Can any serious scholar observe the Hoover administration's massive economic intervention and, with a straight face, pronounce the inevitably deleterious effects as the fault of free markets?
The shrinkage in world trade brought on by the tariff wars helped set the stage for World War-II a few years later. When tariffs made it nearly impossible for foreign businessmen to sell their goods in American markets, the burden of their debts became massively heavier and emboldened demagogues like Adolf Hitler. "When goods don't cross frontiers, armies will".
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bripat9643
Diamond Member
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The T
George S. Patton Party
Democracy in pure form is mob rule.
Europe was heavily in debt to the usa THANKS TO WWI.
So naturally in order to pay off those debts Europe had to sell into the USA to find the money to pay off those debts.
Now is that the case TODAY, kiddies?
What nation is tyhe larrgest DEBTOR nation today, kids?
Think think think...economics is NOT chemisty, folks.
Yesterday's formula for a healthy economy is not going to be today's formula because today's economic circumstance is NOT yesterday's economy.
Toro
Diamond Member
Yeah, and the Bush family financed the Nazis.
The lies never stop when the libs are defending the undefendable.
WHOOSH!!
That's the sound of the point going way over your head...
Toro
Diamond Member
I think there is a great deal of truth in this, but there are a few points.
Real GDP fell by an estimated 26% during the Great Depression. It is estimated that Smoot-Hawley caused a contraction of about 4%. It was a stupid, bad policy - we should support free trade - but it wasn't the cause of the Great Depression. It hurt though.
The agricultural economy was in trouble in the early 1920s as war demand tailed off and deflation on the farm economy took hold. There was a series of rolling bank failures in the farm economy that eventually spread east. IOW, it was already in trouble long before the Great Depression.
The criticism of the Fed during the 1920s is somewhat misplaced. It didn't operate in the same manner as it does today. Funds and gold were flowing into the economy after WWI but prices weren't rising as orthodox economics says they should. So the Fed, which operated the quasi-gold standard, did not raise rates in a manner one would expect with a booming money supply.
The criticism of the Fed was that it didn't do enough to offset the contraction of the money supply, especially after 1930 when the Bank of the United States failed. The money supply contracted by an estimated one-third from 1930 to 1933, which is horrendous in a recession. The Fed also raised interest rates from 1.5% to 3.5% in 1931 to stem the outflow of gold, another horrendous mistake in a deep recession. Milton Friedman concluded that the Fed was the cause of the Great Depression, making policy mistakes that turned a nasty recession into a depression. This is probably correct. It is also why Bernanke is creating monetary policy by instituting QE3. The lesson of the monetarists was that monetary policy should offset contraction in the private money supply, otherwise you risk a depression.
Hoover's big budget in 1932 came near the bottom of the economic contraction. Most of the contraction occurred before his budget deficit. In 1929, 1930 and 1931, the deficit was ~1% of GDP. It was 4% in 1932. It is not a surprise that government spending as a percentage of the economy would rise sharply when the economy was collapsing as fast as it could.
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