Posted on 09/26/2009 2:00:32 PM PDT by tired1
My understanding is that WW2 debt was close to our current level of GNP/debt. What were the mechanisms of paying it down? Did the destruction of Axis countries industrial base create a captive market for the US? How was lend Lease and the Marshall plan paid off?
Any insights would be appreciated, thanks.
You don’t know squat about economics. Nada. Zip. Zilch.
Read. The. Chart.
Percent of GDP has NOTHING to do with the value of the dollar. Specifically, the chart addresses ABILITY TO PAY. We had damned high taxes in the post war period so as to pay down the debt. That harmed economic growth. The good news is we got through it - for a lot of reasons, not the least of which is that we sold a lot of stuff to other countries whose factories were destroyed.
Yep, and no arguing the fact that Ronnie’s spending increased our debt. It also broke the Russians. War is not cheap, even Cold War.
True. The defense budget of Ronaldus Magnus funded the cheapest war we ever won.
Au contraire. The chart is expressed in percent of GDP, not in dollars. It is thus inherently adjusted for inflation.
YOUR CHART says UNADJUSTED DOLLARS. Reading comprehension is your problem.
That actually got repealed finally a few years ago. Was pretty short lived though because it was rapidly replaced by a higher tax and called something else.
What part of the words UNADJUSTED DOLLARS on the chart do you not understand?
Since the Russians did the vast majority of killing of Germans, this was without doubt a good investment.
Carter may have not been president in 82, but it’s still a fact that the percentage ended a long slow decline under Reagan and started upward quite dramatically.
A percentage is a percentage.
1945 dollars are compared to 1945 dollars, 2000 dollars to 2000 dollars, etc.
Thanks for sharing that, it’s amazing. No, I didn’t suffer any deprivation growing up. But I sure heard lots of stories about the GD from relatives, none of us kids could understand it, it didn’t make any sense. “Whaddaya mean nobody had any money..?” Grandma said she got an orange for Christmas one year, and was very thankful. Another distant relative got a doll - a picture of a doll, cut from a Sears catalog, and pasted on some cardboard, about the same time. One thing about the GD generations, they know how to take care of things, and they are very thrifty and clean. Grandma kept her place pretty much spotless I remember.
I can't believe you repeat this 1930s faddish garbage with a straight face. That garbage is theory of underconsumption, and FDR's belief that increases in workers' wages will stimulate consumption.Sure, but if *too much* goes into capital you're just as screwed. You can't have supply without demand, which is exactly where the US economy is today.The answer is very simple. A company creates a pie (product). If you pay more to unions, there is less for the shareholders. The total consumption stays the same and EQUAL to the pie created (if part of it is not reinvested). The same is true for the economy as a whole: one sector may appropriate a bigger portion of the pie, but that does not change the size of the pie to be consumed.
There's always a push and a pull both ways. The US is weird, because American consumers are tapped out. What can we sell to China and India that they can't pirate? Services and IP only matter if your trading partner respects them.
That's the old broken window fallacy again.You're making two assumptions, one that unionized American workers "broke" value by unionizing and two that "overpaying" workers inflated the prices of goods and services.Artificially holding wages above their market rate may spur consumption among union workers but it depresses consumption among the consumers who are now having to overpay for those union made products.
It would be more accurate to say the American economy flourished despite union wages.
I'll certainly agree that *after America's industrial infrastructure was gutted* starting in the 70s that unionized labor was uncompetitive, but when America was an industrial superpower unions were a counterbalance and response to business cartels like standard oil, that could artificially depress labor value.
You might want to recheck your numbers. The post WW2 US Bombing Survey shows the German's still had 80% of their industrial/war making capacity. The nations which Germany occupied had even higher numbers as we didn't bomb them as much.
In sum, through the mid 1970's, the US had unique but ultimately transitory economic advantages. Now, massive debt, the expense of the welfare state, high taxes, and the generational deficit caused by the baby bust place us in severe financial peril.Ding ding ding. Smartest post of the thread.
Thank you.
Well, part of the problem is that the rich are voting for this crap, too. Their income is sheltered and they’ll be in good with whoever is on top, barring a revolution.
I think its called “pulling up the ladder.”
Percent of GDP makes no difference. Duh.
Are you GWB? Double Duh.
Disclaimer: Opinions posted on Free Republic are those of the individual posters and do not necessarily represent the opinion of Free Republic or its management. All materials posted herein are protected by copyright law and the exemption for fair use of copyrighted works.