4 ms·

You mean the same New Deal that likely extended the length of the Great Depression by a significant multiple?

by pitaj 8y ago

nickthemagicman 8y ago
This goes against every ounce of history I've been taught.
- nostromo 8y ago
  The New Deal has never not been controversial, from proposal to present day. I imagine its effects will be argued about until the heat death of the universe. https://en.wikipedia.org/wiki/New_Deal#Historiography_and_evaluation_of_New_Deal_policies https://en.wikipedia.org/wiki/New_Deal#Historiography_and_ev...
- skookumchuck 8y ago
  Nearly all histories of the Great Depression are agenda driven, rather than an honest attempt at fact finding. Most paint it as a failure of capitalism, the rest as a direct result of government manipulation of the banking system, trade disruption caused by Smoot-Hawley, and huge tax increases.
- paulddraper 8y ago
  Virtually all credible historians agree that the New Deal itself was largely ineffective in solving the Great Depression. It started in 1933 with unemployment rate of 25%. Half a decade and many millions of dollars later, unemployment was 19%. [1] The Great Depression ended only when Europe went to war in 1939 and financed the American economy. Depending on who you ask, the New Deal was either ineffective because it was fundamentally flawed, or ineffective because it wasn't big enough and didn't raise enough debt. [2] Basically, "economic science" as usual... [1] https://www.u-s-history.com/pages/h1528.html https://www.u-s-history.com/pages/h1528.html [2] https://en.wikipedia.org/wiki/New_Deal#Recovery_2 https://en.wikipedia.org/wiki/New_Deal#Recovery_2
  - e12e 8y ago
    > It started in 1933 with unemployment rate of 25%. Half a decade and many millions of dollars later, unemployment was 19%. Absolute numbers are important, but the rate of change more so. Were unemployment raising to 25% or already going down? It's the difference between those 19% being a meager improvement and staving off absolute disaster.
  - tomjakubowski 8y ago
    By your own source, a majority (51%) of "economic historians" working in economics departments and a strong majority (74%) of "economic historians" working in history departments disagree outright with the statement: "Taken as a whole, government policies of the New Deal served to lengthen and deepen the Great Depression." It seems unlikely that some huge portion (say, > 90%) of those historians further believe that New Deal policies had no or little positive effect on the Great Depression. Are the "credible historians" just the ones who happen to agree with you on this topic?
    - paulddraper 8y ago
      I've never read any modern historian to say that the New Deal effectively fixed the Great Depression. So yes, I believe that most of those 51% and 74% believe the effect was nonexistant or small. Typically, something like "if FDR had spent as much on the New Deal as he did during the War, it would have ended the Depression". [1] (I.e., it was too little, as in my previous comment.) I welcome any references to historians claiming the New Deal largely fixed the Great Depression. (Or really, any option from a historian more positive than the quoted article.) Or...you know, just silently downvote this comment :) [1] https://www.thebalance.com/the-great-depression-of-1929-3306033 https://www.thebalance.com/the-great-depression-of-1929-3306...
- Camillo 8y ago
  The parent post should not be downvoted. It's perfectly possible that the effect of the New Deal is controversial (or even dubious) amongst historians and that most schools teach it as a resounding success. In that case, it's interesting to hear both what historians think and what people are actually taught.
nradov 8y ago
While the New Deal may have lengthened the Great Depression (impossible to prove one way or the other), it was a net win by preventing a violent socialist revolution. Those uprisings occurred in other countries. It really could have happened here.
- MikeHolman 8y ago
  That's assuming a socialist revolution is unequivocally bad. The world would be so incredibly different, it's impossible to say that it would be worse.
  - nradov 8y ago
    A socialist revolution during the Great Depression would have left the USA temporarily too weakened and divided to help the Allies defeat the Axis powers in WWII. That would have been unequivocally bad for the entire world.
Symmetry 8y ago
You can't just sum up the huge variety of programs that was the New Deal like that. Yes, the National Industrial Recovery Act (NIRA) probably did halt the existing recovery but it was a recovery that FDR had started by reversing the hard money policies of his predecessors. And you can certainly argue all day about whether stuff like FDIC was a net improvement if you want to but that didn't really affect the length of the Great Depression. We actually have a pretty good idea of what worked and what didn't during the Great Depression and mainstream economic historians[1] seem to have reached a rough consensus. In school, though, we teach the Great Depression through the lens of political history. So for that purpose it doesn't matter what was really causing it, just what people at the time thought was causing it. [1] I'm excluding Marxists, Austrians, MMTers, etc here.
- RugnirViking 8y ago
  Don't tease us! We aren't all familliar with economic theory - what is the consensus on what worked during the great depression?
  - Symmetry 8y ago
    Really I'd recommend reading chapter 1 of The Wages of Destruction. The book is really on the economics of WWII but it summarizes the modern consensus on the Great Depression as a starting point and since it fits everything into one chapter ends up being very readable. Mostly it was contagious deflation mediated by the gold standard with gold hording causing deflation causing more hoarding. Countries on the silver standard like China were essentially unaffected. Countries that went off the gold standard early like the UK or Japan recovered early. The Wikipedia article is mostly a history of how economists' understanding of the Great Depression has changed over the decades rather than a description of where it stands now but it works pretty well. https://en.wikipedia.org/wiki/Great_Depression#Mainstream_explanations https://en.wikipedia.org/wiki/Great_Depression#Mainstream_ex... EDIT: A while ago Krugman had a very good piece trying to explain how deflation can cause problems. Different sorts of economists often disagree about whether its interest rates or aggregate quantities or expectation traps or whatever that's the most important aspect of tight or loose money but they all agree that these things are real and meaningful and generally explain depressions. http://www.slate.com/articles/business/the_dismal_science/1998/08/babysitting_the_economy.html http://www.slate.com/articles/business/the_dismal_science/19...

You mean the same New Deal that likely extended the length of the Great Depression by a significant multiple?

by pitaj 8y ago

You mean the same New Deal that likely extended the length of the Great Depression by a significant multiple?

nickthemagicman 8y ago

This goes against every ounce of history I've been taught.

nostromo 8y ago
The New Deal has never not been controversial, from proposal to present day. I imagine its effects will be argued about until the heat death of the universe. https://en.wikipedia.org/wiki/New_Deal#Historiography_and_evaluation_of_New_Deal_policies https://en.wikipedia.org/wiki/New_Deal#Historiography_and_ev...
skookumchuck 8y ago
Nearly all histories of the Great Depression are agenda driven, rather than an honest attempt at fact finding. Most paint it as a failure of capitalism, the rest as a direct result of government manipulation of the banking system, trade disruption caused by Smoot-Hawley, and huge tax increases.
paulddraper 8y ago
Virtually all credible historians agree that the New Deal itself was largely ineffective in solving the Great Depression. It started in 1933 with unemployment rate of 25%. Half a decade and many millions of dollars later, unemployment was 19%. [1] The Great Depression ended only when Europe went to war in 1939 and financed the American economy. Depending on who you ask, the New Deal was either ineffective because it was fundamentally flawed, or ineffective because it wasn't big enough and didn't raise enough debt. [2] Basically, "economic science" as usual... [1] https://www.u-s-history.com/pages/h1528.html https://www.u-s-history.com/pages/h1528.html [2] https://en.wikipedia.org/wiki/New_Deal#Recovery_2 https://en.wikipedia.org/wiki/New_Deal#Recovery_2
- e12e 8y ago
  > It started in 1933 with unemployment rate of 25%. Half a decade and many millions of dollars later, unemployment was 19%. Absolute numbers are important, but the rate of change more so. Were unemployment raising to 25% or already going down? It's the difference between those 19% being a meager improvement and staving off absolute disaster.
- tomjakubowski 8y ago
  By your own source, a majority (51%) of "economic historians" working in economics departments and a strong majority (74%) of "economic historians" working in history departments disagree outright with the statement: "Taken as a whole, government policies of the New Deal served to lengthen and deepen the Great Depression." It seems unlikely that some huge portion (say, > 90%) of those historians further believe that New Deal policies had no or little positive effect on the Great Depression. Are the "credible historians" just the ones who happen to agree with you on this topic?
  - paulddraper 8y ago
    I've never read any modern historian to say that the New Deal effectively fixed the Great Depression. So yes, I believe that most of those 51% and 74% believe the effect was nonexistant or small. Typically, something like "if FDR had spent as much on the New Deal as he did during the War, it would have ended the Depression". [1] (I.e., it was too little, as in my previous comment.) I welcome any references to historians claiming the New Deal largely fixed the Great Depression. (Or really, any option from a historian more positive than the quoted article.) Or...you know, just silently downvote this comment :) [1] https://www.thebalance.com/the-great-depression-of-1929-3306033 https://www.thebalance.com/the-great-depression-of-1929-3306...
Camillo 8y ago
The parent post should not be downvoted. It's perfectly possible that the effect of the New Deal is controversial (or even dubious) amongst historians and that most schools teach it as a resounding success. In that case, it's interesting to hear both what historians think and what people are actually taught.

nradov 8y ago

While the New Deal may have lengthened the Great Depression (impossible to prove one way or the other), it was a net win by preventing a violent socialist revolution. Those uprisings occurred in other countries. It really could have happened here.

MikeHolman 8y ago
That's assuming a socialist revolution is unequivocally bad. The world would be so incredibly different, it's impossible to say that it would be worse.
- nradov 8y ago
  A socialist revolution during the Great Depression would have left the USA temporarily too weakened and divided to help the Allies defeat the Axis powers in WWII. That would have been unequivocally bad for the entire world.

Symmetry 8y ago

You can't just sum up the huge variety of programs that was the New Deal like that. Yes, the National Industrial Recovery Act (NIRA) probably did halt the existing recovery but it was a recovery that FDR had started by reversing the hard money policies of his predecessors. And you can certainly argue all day about whether stuff like FDIC was a net improvement if you want to but that didn't really affect the length of the Great Depression. We actually have a pretty good idea of what worked and what didn't during the Great Depression and mainstream economic historians[1] seem to have reached a rough consensus. In school, though, we teach the Great Depression through the lens of political history. So for that purpose it doesn't matter what was really causing it, just what people at the time thought was causing it. [1] I'm excluding Marxists, Austrians, MMTers, etc here.

RugnirViking 8y ago
Don't tease us! We aren't all familliar with economic theory - what is the consensus on what worked during the great depression?
- Symmetry 8y ago
  Really I'd recommend reading chapter 1 of The Wages of Destruction. The book is really on the economics of WWII but it summarizes the modern consensus on the Great Depression as a starting point and since it fits everything into one chapter ends up being very readable. Mostly it was contagious deflation mediated by the gold standard with gold hording causing deflation causing more hoarding. Countries on the silver standard like China were essentially unaffected. Countries that went off the gold standard early like the UK or Japan recovered early. The Wikipedia article is mostly a history of how economists' understanding of the Great Depression has changed over the decades rather than a description of where it stands now but it works pretty well. https://en.wikipedia.org/wiki/Great_Depression#Mainstream_explanations https://en.wikipedia.org/wiki/Great_Depression#Mainstream_ex... EDIT: A while ago Krugman had a very good piece trying to explain how deflation can cause problems. Different sorts of economists often disagree about whether its interest rates or aggregate quantities or expectation traps or whatever that's the most important aspect of tight or loose money but they all agree that these things are real and meaningful and generally explain depressions. http://www.slate.com/articles/business/the_dismal_science/1998/08/babysitting_the_economy.html http://www.slate.com/articles/business/the_dismal_science/19...