The 2nd WW, the Crash, the New Deal and the recovery are incredibly complex historical and economic events that cannot be summarized, no less explained by trumpeting one philosophy over another with cavalier confidence. On one hand, right-wing revisionists have stated from Milton Friedman to Amity Schlaes, that with all the money thrown at the economy from the New Deal, the Depression was never really ended. And it took WWII to do the job.
Doesn’t that logic beg the issue? Who would have allowed $350 billion, which was borrowed and spent on the war to bring us out of the economic malaise brought on by the Crash? So spending actually ended the Depression! But, we needed a war to justify the means to the end. But, in fact the recovery was well on its way until late 1937 when those Federal Reserve, Dixiecrat conservative Democrats and Republicans pressured FDR to balance the budget. FDR, certainly wanted a balanced budget and talked about it from day one, and when he went in that direction, with the urging of Fed Chairman Morris Eccles, the bottom fell out of the economy, and we had the short but vicious Recession of 1937. By the way, it quickly ended, by loosening credit once again and priming the pump. More Keynesian economic philosophy at work!
Look at the size of the 1929 economic downturn and compare it with today. We are still reeling from the 2008 crash and it maybe years ahead before we return to the artificial heights brought on by the “Housing Bubble,” created, and delivered by cheap credit, phony oversight, and de-regulation by industry groups like FINRA that failed, and private sector ratings companies like; Moody’s, D & B, S & P and Weiss Reports who were either bribed or incompetent. The halcyon days of the Bull Market of 1929 were not reached until 1950, when the DJIA again reached the levels before the October Crash. Many on the right seem to have forgotten that the DJIA average has doubled in 3 years since the double bottom of the Dow from the lows in the 6000’s.
American big business and capitalism did the job of creating the “Arsenal of Democracy,” but with two essential components, the great leadership, foresight and brilliance of FDR and enough money and monopoly power thrown at under utilized capacity. Do not forget that in 1928, US Steel had 220, 000 employees and at the time of FDR’s inauguration in March of 1933, it had one.
As to who won WWII, the argument is moot; Russian blood and American production and know how. But, don’t short change the Russians on their production. Their tank and aircraft production was remarkable and their courage and sacrifice was great.
In spite of Forbes, Schlaes, Friedman, Rand along with other revisionists and proponents of de-regulators, the New Deal worked, the country survived, CCC built up our manpower along with its parks and forests and creation, and the WPA and PWA built the rest of the country. The infrastructure of this country was built by the New Deal and its legacy is irreversible. What we needed could have never been done with the “free market” alone. Today is a prime example of that reality. After decades of starving our infrastructure, only government with big dollars, fed into the private sector can rescue a rotting system.
The Intercontinental Railroad, the Civil War, the Interstate Highway, the Space Program, the New Deal, WWII and the Cold War put trillions of dollars back into American industry and created 10’s of millions of jobs. To deny that is to deny history. By the way, during the so-called wonderful Eisenhower Years we created only 3 million jobs in eight years and endured three recessions. That period was one of our worse job creation periods in the 20th century. Also, do not forget, from Truman on today, who created the most jobs.
Wall Street Journal
GW Bush 3.0 million
GHW Bush 2.5
For all you doubters, Democrats have created far more jobs than the GOP.
On a year by year basis- Clinton, Carter, Reagan, LBJ, Truman, Nixon and JFK lead Ford, Bush I and II and Eisenhower by a wide margin. In 28 years the Democrats created 57 million jobs to the GOP’s 36 million in 36 years. Those are the facts. Look it up from the WSJ.
Typical insincere title. That was not an attack on capitalism, but on Romney’ s sorry record regarding job creation and workers. He was constantly attacked by your favorites on the right-wing and now you are attacking the President on the same exact issues. That’s hypocrisy and a lack of real world thinking.
In truth, 200 of the 400 billionaires in America do not work, many are heirs and like Romney the bulk of their fortune’s are parked off shore in tax shelters like the Cayman Islands, Switzerland, Monaco and Luxemburg. Many, like Romney, are paying less than 15% federal taxes.
Of course, every suggestion of tax reform and regulation: the Volcker Rule, Dodd- Frank or even the Buffett tax is decried by the folks who benefit from de-regulation and low taxes. Few of these folks even pay the Reagan 28% bracket. We should go back to Clinton’s 39.5% on incomes above $250K, go back to inheritance taxes on the rich and the Buffett tax on the 1% earners. There are 375K American who make more than $1 million per year. As many of you may know, JP Morgan just lost $2 billion of their depositor’s money. Their CEO has been at the fore front of decrying and opposing regulation. Which way do you want it?
If there is such a deficit crises start there with more revenues on those who can afford to pay.. As for cuts, there are three sectors where the money is spent: the military, vets, homeland security and debt service in the discretionary budget. We can’t touch debt service so, there isn’t much wiggle room. The long-term entitlement budget obligations :SSI and Medicare will affect you if they are cut, but have little to do with current economic needs. Your choice. But the Medicare tax is only 1.45% and the SS pay roll tax is cut off at $106K in earnings. If you are concerned about more taxes on businesses, raise the pay roll tax only on the workers who will get the benefits in 40 years or less. Meanwhile you had better have an idea for the 100 million pre and post baby boomers. But let us face it, there are huge infrastructure needs, jobs for returning vets, and there is always budget creep. You don’t want federal workers to be paid a middle class wage or to have raises, well apply that to yourself and to your progeny.
All this talk about socialism and communism is bunk. Long term benefits exist in every Western country of the world and they are tweaked upward when needed. You may not like taxes, but a raise in the middle class federal withholding taxes is not being considered. Just remember we have an expensive country, a large world-wide volunteer military, and police, fire, sanitation on the local and state level. We also must maintain roads, harbors, airports, all sorts of aging infrastructure, national parks, clean water and clean air. Don’t depend on the private sector. They have no interest except the accumulation of wealth for succeeding generations.