So why was there a boom instead of a bust, after WW2?

"Standard (non-political) thought now is that FDR deepened and extended the depression."

LMAOROG> Seriously?


Upon deeper examination, I discovered that the right bases its New Deal revisionism on the short-lived recession in a year straddling 1937 and 1938. But that was four years into Roosevelt's term - four years marked by spectacular economic growth. Additionally, the fleeting decline happened not because of the New Deal's spending programs, but because Roosevelt momentarily listened to conservatives and backed off them. As Nobel-winning economist Paul Krugman notes, in 1937-38, FDR "was persuaded to balance the budget" and "cut spending, and the economy went back down again."

To be sure, you can credibly argue that the New Deal had its share of problems. But overall, the numbers prove it helped - rather than hurt - the macroeconomy. "Excepting 1937-1938, unemployment fell each year of Roosevelt's first two terms (while) the U.S. economy grew at average annual growth rates of 9 percent to 10 percent," writes UC Davis historian Eric Rauchway.



OK - if the verifiable evidence proves the New Deal did not prolong the Depression, what about historians - do they "pretty much agree" on the opposite?

NO

As Newsweek's Daniel Gross reports, "One would be very hard-pressed to find a serious professional historian who believes that the New Deal prolonged the Depression."

https://www.sfgate.com/opinion/article/FDR-prolonged-the-Great-Depression-Really-3255706.php

 

Right wingers are trying for about 15 years to rewrite history, that's for sure!


Um, no. Public confidence in markets reached a nadir in 1933, when half the banks in the country had closed, when Wall Street was essentially out of business, when the Dow stood at its appalling lows, when employment was about 25 percent. In 1933 -- before the New Deal -- there was no securities industry, no banking industry, no mortgage industry, no capital formation or lending of any kind. That year, an estimated 40 percent of home mortgages were in default.

It was only with the passage of New Deal efforts--the SEC, the FDIC, the FSLIC--that the mechanisms of private capital began to kick back into gear. Don't take it from me. Take it from Federal Reserve Chairman Ben Bernanke, who wrote the following in Essays on the Great Depression: "Only with the New Deal's rehabilitation of the financial system in 1933-35 did the economy begin its slow emergence from the Great Depression."...

The argument that the New Deal's efforts "perhaps had prolonged, the Depression," is likewise a canard. One would be very hard-pressed to find a serious professional historian--I mean a serious historian, not a think-tank wanker, not an economist, not a journalist--who believes that the New Deal prolonged the Depression.... My confidence in George Will is at a nadir.

A normal person would not argue that the New Deal prolonged the Great Depression. A normal person would require a case that he or she could point to of a country that (a) relied on market forces alone to generate recovery, and (b) recovered fully from its Great Depression. But George Will is not a normal person.


https://delong.typepad.com/sdj/2007/01/daniel_gross_ha.html

 

Waaay too much crazy out there..

Brad Delong is one of my favorite economists. The good ones know more than economics.

 

Some argue that if you spend money now, even if it seems to "help" the economy, the economy will have to pay for it later.

 

Every credible economists, those that don't want to see Gov';t shrink small enough to drown it in a bathtub, believes cutting taxes without cutting spending, something the GOP has done since Ronnie, leaves debt to be paid for later. The difference is one party isn't trying to shrink Gov't to the size we can drown it in a bathtub!

 

There is such a thing as a credible economist?

They can ignore the depreciation of hundreds of millions of automobiles trashed since Sputnik but talk about buying new cars adding to GDP.

 

1945-75 was an artificially lush period for the US economy, with much of the rest of the world challenged by severe war damage. In the US there was enough fat in the system to support many luxuries that were later squeezed out by the return of international competition.

 

Those who profess to want small government only want government to be small for other people. They definitely want a government large enough to issue and enforce the privileges of the privileged, and to stop the victims of the privileged from defending themselves.