Your argument is… a quote from Grover Norquist? “Really?” right back at ya.
I thought you said government expenditures don’t work.
Yes. That is why GDP can be skewed by gov spending.
moonshot925, I want to make sure you saw the question I asked you in post #26.
Any thoughts?
WW2 pulled us out by getting manufacturing operating at full capacity. Then the recovery of the private sector began after government spending stopped in 1946.
It should be obvious that greed (or to be euphemistic, “ambition”) is what drives people to succeed, and in their success, leave a trail of improvement and progress in the wake of their rise toward the shining city on the hill. Only unleashing the natural human, nay primal, desire will lead to economic growth and better lives for us all as we all bask in the glow of the gains that the upper crust have led us to.
It is not a conundrum that the wealthy and powerful live lives that are so wholly divorced from the realities that most of us have to deal with, for how could they ever focus on decision-making if they were constantly faced with petty details and riff raff. Money, after all, is power concrete (though it is somehow a different thing from “wealth”) and begs to be properly exercised. To deprive the successful their due right would be akin to summary amputation of vital limbs, hobbling the great market engine of capitalism that has got us to where we are.
Where ever that is.
Upthread I refuted the claim about GNP. Let’s look at “production.” (But first, and noting that Moonshot’s source is French, let’s note that “did not reach” means n’a pas atteint. Moonshot’s own data show l’indice de la production de 1937 était supérieur à l’indice de 1929.)
From a starting point of 63 in FDR’s first year, the U.S.A. production index grew to 103 in just four years. That’s 13% annual growth! To support the claim that “The New Deal was a huge failure,” I’d like, first, to get an example of any other 4-year period, whether “huge failure” or not, with an average annual production growth of 13%.
Oh and BTW, … when criticising Keynesian stimulus, pointing to the 1937-8 recession does not help your case: that recession occurred precisely when Keynesian policies were reversed. You’re a newcomer here, moonshot925, perhaps you weren’t aware that this trick has been tried before. Dopers don’t fall for it.
Did you even click your own link? Your data comes, I think, from Table 91 in a 45-page document whose first table is Table 55. I’m curious why you didn’t mention the Table number, instead expecting any link-clickers to wade through so much to confirm your cite.
Just look at steel production from my site. Steel production did not reach the 1929 level until 1939.
Motor vehicle production did not reach the 1929 level until 1949.
http://web.bryant.edu/~ehu/h364proj/fall_97/lushing/prod2.htm
So
has transmuted into “some production levels did not reach 1929 level until 1939.” Do you understand why collapsing claims like yours will undermine your credibility?
And, what’s your cite for the “huge failure”? TheOnion.com ?
FDR’s policies prolonged Depression by 7 years, UCLA economists calculate
http://newsroom.ucla.edu/portal/ucla/FDR-s-Policies-Prolonged-Depression-5409.aspx?RelNum=5409
This isn’t remotely close to being accurate. GDP is the vale of goods and services produced. I have no idea where you are coming up with this stuff.
It is accurate according to Wikipedia.
GDP = private consumption + gross investment + government spending + (exports − imports)
Huh. Well, please accept my apologies.
I’m not an economist or a historian, but it seems to me that all of these arguments are overlooking another factor which may be of some importance. In the days of the Great Depression, I believe we were much more of a rural and agrarian nation than we are today. I know we had industry and manufacturing, but I’m guessing that a far greater percentage of people, including many of those employed in manufacturing, lived in more rural settings and were better able to withstand the effects of the depression. My views may stem mostly from stories told by my father, who was born in 1920 and remembered those times. His family, while not at all wealthy, scraped by in part by being able to grow at least some of their own food. He told me stories about people coming to their door looking for work or food. Although his family was in no position to provide work or money, he said his mother never turned anyone away without at least a meal.
In today’s society, I don’t think nearly as many of us have backyard gardens or chicken coops (both of which my grandfather had as recently as the 1950s) that could help to sustain us. I honestly don’t know if that’s a significant consideration or not, but I’d be interested in hearing some opinions about this.
All “regulations” are not created equal. I mean enforcing building codes is a form of “regulations”. Ensuring banks maintain a certain level of reserves to cover their loans or preventing them from making loans to people who have no chance of ever paying them back are regulations. And while all regulations do incur a cost on business, good regulations are there to prevent a much greater economic cost down the road.
So would you agree government spending was a key component in revitalizing the private sector?
The trend line in the graph is the trend for the decade not the overall trend in the economy previous to the depression. Potential GDP did not recover until 1941, GDP per capita did not recover until 1939 and employment did not recover until 1942. Up thread you can follow a link to Cole and Ohanian’s paper stating that real output was 25% to 35% below trend during the late 1930s.
Given that reality most people have fallen back to the arguement that the new deal may not have solved the great depression but it kept another one from happening. Given that another recession happened during the new deal that is a strange argument.
I find the graph that Septimus provided to be indicative of a strong positive correction that was followed by a mild recession followed by growth.
I think the idea that the New Deal was a mistake is a bit specious.
You may have something there. Historians of the period have had to focus on the urban poor, because almost all of the primary source material came from urban society. Until well into the New Deal era there were few or no social workers, documentarians, or investigators in rural places. Even then, they concentrated in the very poorest areas, such as the dustbowl or the deep south. Importantly too, these workers came mostly from the urban northeast, where social reform was an organized mass movement, so they had their own assumptions and even prejudices to deal with.
I think you and Ruby Slippers both have a good point (or two?).
Here in Appalachia, self-sufficiency is a given. Backyard gardens and chicken coops are as common as SUVs are in suburbia. If and when things ‘go south’, we are ready to handle it. At least, I hope we are. Winter is coming.
My father’s family in middle Georgia lived through the GD by the skin of their collective teeth by working the land that was owned by other people. They were called share-croppers. I imagine y’all have heard of the term before. Dad told me of days when they only had a few potatoes and a head of cabbage for their sustenance. They had long since killed and eaten the chicken. Their only cow was a distant memory. It was touch and go for a year or two until things started to stabilize. FDR’s programs saved my family (or more precisely, my ancestors) and reading a graph doesn’t validate that reality even when it matches the fortunes of my family.
Some (not most, but some) of FDR’s anti-Depression policies were mistaken. Nevertheless, I think all of the following are true statements:
[ul][li] Hoover’s policies were far worse.[/li][li] FDR’s mistakes are well known to today’s economists.[/li][li] FDR himself acknowledged that the path to recovery was not obvious, saying “Take a method and try it. If it fails, admit it frankly, and try another. But by all means, try something.”[/li][li] The 13% annual growth from 1933-1937 was huge. To pretend that doing nothing would have effortlessly led quickly back to an old “trend line” – one inflated by a bubble no less – is absurd. Click here for a glimpse of bust-boom-bust behavior before U.S. government policy was guided by rationalists, beginning with FDR.[/li][li] To find one economics paper agreeing with a position is hardly authoritative. Heck – even the Austrians write papers. 
[/li][/ul]
Various analyses of the Great Depression have been made in prior threads. Since the outlook for this thread is, at best, that it will rise to the level of redundancy, I don’t want to argue against goal-post movers, except to make one comment:
A summary like “The New Deal was a huge failure” goes way beyond “overly facile” and is instead better characterized as “absurdly wrong.”