Thursday, January 22, 2009

What the hell???

Dude, what do you think the "New Deal" was?

Roosevelt promised a "new deal" at the Democratic National Convention in Chicago, IL on July 2nd, 1932. It was his name for his "promises" to work to alleviate the pains of the depression of '29, which was rapidly reaching its lowest point. These promises included new jobs for millions, new opportunities for business, and a new level of trust between Government and the private sector.

Hell YES I think the repeal of the Volstead Act was New Deal legislation! Ending 13 years of useless government regulation on morality that crippled an HUGE section of our national economy and forced more than a million people and hundreds of successful businesses into bankruptcy... how much more "New Deal" can you get than that? I don't care by what process the change was made... FDR initiated it, and it was part of his election campaign PROMISES, so that, by its very definition, makes it NEW DEAL. Sheesh.

You wrote: "DID THE NEW DEAL END THE GREAT DEPRESSION? That answer is a clear and unambivalent NO. DID THE NEW DEAL END THE GREAT DEPRESSION? That answer is a clear and unambivalent NO. Now first we must quickly discern something (again, for I have done this at nauseam). The two depressions that hit in the 30's DO NOT by themselves define the historical term "The Great Depression." Ok? The Great Depression includes those two depressions, at least 2 recessions (if I remember correctly from class), the turbulent stock market including high value wipe outs, and probably THE MOST significant in terms of effecting everyday persons living in that era - UNEMPLOYMENT."

Ad nauseum, indeed. We HAVE been over this many time before, my friend... I thought it amply covered. However...

There were TWO depressions between 1929 and 1939. TWO. '29 to '33 and '37 to '38. that's it. No recessions. Why do I say this? Because the GDP (the LARGEST indicator of a recession/depression) did nothing but go UP from '33 to '37, and from '38 to '40. Only UP. In fact, by the spring of 1937, the GDP was HIGHER than it had been in 1929 before the Crash! ALL ECONOMIC INDICATORS were higher than their '29 levels except unemployment, and it was at its lowest since '33 (14%). So, by 1939, the US economy was BIGGER and growing FASTER than it had been before the "Black Tuesday" crash of '29. The ONLY difference was that by 1939, the nations still had an 11% unemployment rate, and it had been as low as 3.3% in 1929.

Now, with the economy hitting it's rock-bottom in 1933, and EVERY SINGLE economic indicator (low prime interest rate, low inflation rate, rising GDP, the dollar getting stronger every day, and unemployment FALLING at a steady and measurable rate) showing the "Great Depression" to have ended by 1939, a full TWO YEARS before Pearl Harbor... you are STILL going to tell me that the policies and programs instituted by the Roosevelt Administrations that have become known as the New Deal had NOTHING to do with the recovery... and that NOTHING got better until the US was ass-deep in WWII and cranking out Shermans and B-17 like they were going out of style? Who is making the stretch now?

I'm so TIRED of hearing wanna-be conservative intellectuals (present company excluded... mostly) constantly referring to New Deal policies, especially FDR's policies, as "socialist". If FDR wanted to institute socialism in America, what better opportunity did he have than the chance to nationalize the banks, railroads, and industries that were CRASHING down around his ears? He RAN for office on the premise that "laissez faire" economic policies WERE NOT working for Hoover (and they weren't), so he instituted greater regulation and oversight... yes. But it was a far cry from socialism.

That aside... back to my main point.

NO ONE can say that the economy hadn't recovered all that it had lost EXCEPT in the realm of employment. So, what was it that kept unemployment so HIGH throughout the 1930's? As I have admitted, I do not doubt that the HIGH taxes that FDR's policies called for (he HAD to pander to some degree to the "balanced budget" crowd in Congress... ) kept an artificial limit on how far the private sector was willing to go to hire people AWAY from safe, secure and GUARANTEED Government jobs like the WPA, the CCC, and many others. Just as influential though, was the possibility that people like our grandparents that HAD a job for the government were very reluctant to give it up for a job that might vanish in a year... even if it did pay more. Can THIS be discounted when considering what THAT generation went through from '29 to '33? Don't you think that there was a limit on how much the people were willing to TEST their trust of FDR's new economy? Put yourself in their shoes, and tell me you'd risk your GUARANTEED $100 a month job for a $150 a month job that might dry up and blow away without warning... especially with a house full of kids and a mortgage to pay. Is that a FAILING of the New Deal, or is that a FACT of hard economic times?

Finally, I want to ask... once and for all... WHAT did WWII fix? Unemployment? By '41, the rate was less than 9%, and FALLING. Everything else was at levels as high as... or higher than... they had been in '29! What did the US involvement in WWII FIX that wasn't fixed already?

Can you deny that, while the people NOT enlisted had jobs and paychecks and savings bonds, they didn't have anything to BUY until AFTER the winter of 1945? Could Rosie the Riveter buy a new Chrysler in '43? (No new cars produced from '41 to '46) Could her kids buy new Schwins? (steel rationing, rubber rationing) How many pairs of stockings did she buy each month? (silk and cotton rationing) Was there a new vacuum cleaner under her tree that Christmas? (no consumer electric motor production, plastic rationing) Did she take the kids on vacation for the summer? (gas rationing, mileage limits, train and road taxes)

If times are tough now, it is because the US has (once again) forgotten that credit needs to be paid back. This was what caused the '29 crash, too. The BOOM of the 50's was due to a NATION that was forced to SAVE money. Soldiers and sailors coming home to back pay and bonuses, and wives and kids cashing in war bonds by the armload. You cannot point to a post-war boom and not recognize the pre-war and war-time freeze on spending, intentional or otherwise.

So, please... answer this one question if you do nothing else: What did WWII fix that wasn't already either FIXED or rapidly IMPROVING without the war?

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