…except, that what you are saying did not work in the 1930’s, and it would not work today. What Roosevelt did by raising the top rate and hiring people at government expense resulted in giving us the Great Depression during the entire 1930’s, and which might not have ever ended if not for WW2.
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Well, someone named New Deal Democrat is obviously going to disagree with that assessment. 
-XT
Also, a little something called “history”!
The Great Depression was ended by high government spending and high government employment paid for by high taxes on the rich. It did not have to be military spending. It had to be government spending because the private sector on its own was not creating enough jobs, just as it is not now.
I can see government controlling wages causing a floor on the price of labor preventing the market clearing mechanism (after all if labor drops to $1/hour a lot of labor intensive industries would move back from China to the US), the same holds true for OSHA regulations. Is this the sort of thing you are proposing? Is that how you would define a free society?
BTW, how does the government “flood” the labor market?
Good for you, but that is not a model on which an entire country can thrive. Its not a race to mediocrity that Jac is advocating here (or at least I don’t think it is)
Perhaps you’re right, but I just can’t stand his philosophy that “we’re all doomed”. I look around me, and most people are doing OK. Some are doing very well. So it’s not just that I think I’m so special. Everyone around me must be special too, because they all still have jobs. Most recently, a lady was laid off from our company last fall – she’s got a great new job now.
Maybe it’s just my industry: Navigation and mapping systems software enginering. Very specialized and very tricky. If you have experience here lots of companies want you.
What was it about WW II that ended the Depression?
While I believe that is sound economic theory, what happens when you have a situation like now where the government is trillions of dollars in debt?
During the twenties three Republican administrations helped by Republican congresses paid down the national debt. This was responsible. Since 1980 the Administrations of Ronald Reagan, George H.W. Bush and George W. Bush raised the national debt, even when the economy was growing.
I think that was more than irresponsible. It was politically devious. Since 1980 the GOP has touted the revenue building benefits of tax cuts. When those benefits failed to materialize, it used the deficits to try to cut popular domestic programs, and to prevent the Democrats from proposing additional programs to help their constituents.
The Republican Party does not want the government to help those who are not rich. It wants the government to be under funded and incompetent.
High government spending and high government employment paid for by high taxes on the rich.
Shhhhh! I was hoping that Susanann would answer first.
:smack::o
You didn’t answer the question:
Suuuuure. The Depression was almost over after 3 1/2 years of Republican control - 1929 - March 1933. Everything was just hunky dory until FDR ruined it, right?
Take a look at the unemployment numbers, which steadily improved after FDR got going until 1937 when he did the foolish thing of trying to balance the budget again.
During the Bubble people were swarming into computer science programs and sometimes even getting good jobs without finishing. But there is a problem even with that ideal case, because when the crash came, these were the first to go.
I don’t think the five to one ratio will last forever though. I’ve seen reports of a big upsurge in CS hiring in the Bay Area. We’re hiring again, finally, and there is supposedly a lot of competition for the very specialized graduates we’re looking for. We’ve been doing pretty well, but we are paying a very decent salary for new Ph.Ds. That’s a good example that jumping into retraining programs won’t help - these people started their course years ago.
Even newly graduated lawyers are having problems today. So there are no safe havens. You either have to be smarter than the other four or lucky, and have studied something for which there is demand and for which other people are not studying. Retraining with everyone else in the world is going to work out as well as buying a stock which everyone else is buying.
President Obama faces difficult problems without easy or obvious solutions. Right after he was inaugurated, and when his approval rating was close to 70 percent he should have raised the top tax rate, and hired people at government expense. Instead, he expended his popularity with a health care program most Americans do not like. At this point he can only wait and hope things get better. He no longer has the political clout to do anything that is unpopular.
This is complete proof that you flat out don’t know what you’re talking about. It’s a good thing to have a certain baseline unemployment level in a healthy economy. It allows for a certain amount of mobility in the job market- people can find open jobs and companies can find open workers.
If everyone were fully employed, it would be much harder to hire or find a job. Plus, inflation would go up as full employment was attained. That’s why the government defined “full employment” as 3% unemployment back in 1978.
It is really not just conjecture that leads the world’s economists to believe that keynesian policies worked during the Great Depression. You see America was not the only country that was affected by the Great Depression and different countries adopted different policies and while every country is different and the results varied, on the whole countries that adopted austerity measures took longer to recover than those that engaged in stimulus and pulled the rest of the world out of depression. So when you say things like this, you are merely repeating bullshit that you heard from someone who is lying to you. Its political revisionism by people who want you to believe that they have an easy answer to all the world’s problems.
We had high tax rates between 1932 and 1981. I don’t think you can say that those tax rates had an awful lot of correlation to economic cycles.
I think there are two factors. One is taxation as a method of getting the capital off the sidelines. The second is that deficit spending injects money into the system that wasn’t there before. IMHO, taxation should be determined independently of stimulative policies. The disincentive effect of a moderate tax hike on the rich is so fucking microscopic that we probably get more stimulative effect from extending unemployment benefits by 3 months than by keeping low tax rates for the top 1% of the country.