samboct
Posts: 1817
Joined: 1/17/2007
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I haven't seen a single article on the Great Depression which explains a few key facts yet-
Unanswered questions-
1) What was the unemployment rate? Apparently most economists have neglected individuals employed on WPA projects as "make work" or temporary employment and continue to refer to these people as unemployed- which will certainly swell the numbers of the unemployed! Seems to me that if whether you're building a dam for the WPA or on a road crew in today's world, you have a real job- with wages and a task to fulfill. If I were a conspiracy theorist, I'd suggest that there's a lot of revisionist history going on with these labor statistics to make the Great Depression appear worse than it was to help build confidence that we're not now undergoing a similar crisis. It's hard to ignore that both the Great Depression and the current "recession" we're in have a lot of similarities- Republican presidents, crashing stock markets, deflation, and policies which have favored the very rich.
2) Why did countries such as Japan recover so much faster than the US? Apparently they got to deficit spending sooner- but was that it?
3) What actually worked? Apparently neither Hoover's prescriptions nor Roosevelt's actions succeeded in getting us out of the depression-and some authors have pointed out that even with the draft in WWII which took 8 million men out of the labor force, the depression lasted till after WWII. I find this highly unlikely- seemed to me that with the massive hiring at defense companies, companies were struggling to fill the workforce. I know this was the case for Lockheed- one of the largest defense manufacturers.
4) Most economists gloss over the effects of the dustbowl, but given the large percentage of the economy that was dependent on agriculture, this seems foolish. Claiming Roosevelt's actions were ineffective because unemployment increased again in 1937 seems to omit natural disasters as a cause of prolonging the depression. We may be facing similar challenges with global warming.
5) A simple distinction between recession and depression. Strikes me that we're probably in a depression now- never mind recession.
I'm sorry, but all the articles I've seen are poor science/history and have a heavy idealogical bent. Until there can be basic agreement on terms such as unemployment, depression/recession there is no way to fit all the facts into a cogent theory.
My take on the situation-
Hoover took a recession and spun it into a depression by failing to increase the money supply during a deflation.
Roosevelt tried a bunch of tactics with varying degrees of success. Much of the "aura" ascribed to Roosevelt is clearly due to a sense of if there's a crisis, inactivity is seen as paralyzing indecision. Given that a large chunk of the success of an economy is due to confidence it's clear that even actions that may be counterproductive in the long run- if they raise consumer confidence for long enough, can nevertheless have a net positive effect. It's probable that not all of Roosevelt's policies were successful.
Sam
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Another Great Depression? - 
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- You know me CL, I never listen to hearsay...
RE: Another Great Depression? - 
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