Skip to comments.Stimulating History
Posted on 03/08/2010 8:37:25 AM PST by bs9021
Stimulating History James F. Davis, March 8, 2010
To be able to critically analyze economic probabilities, one needs to know the history of previous similar situations. For the first 125 years of our county we had no Federal Reserve Bank, no permanent personal income tax and no massive government stimulus spending. We also had virtually no inflation and the average economic downturn lasted only 10 months.
In late 1913 the Federal Reserve Bank (FED) was created. It made it possible for the government to create money out of thin air. Also a permanent income tax was passed.
From 1915 to 1920 inflation was over 75%. Since 1915 inflation has been over 340% according to the Bureau of Labor Statistics.
By 1920-21 the USA experienced the greatest economic downturn and depression in our history. Our economy contracted by 21% in one year putting millions out of work.
What caused this? Among other things, the Federal Reserve Bank became the vehicle used to borrow and create money to fund WW I along with a Federal income tax and many new regulations on businesses by the progressive Wilson administration.
What did President Hardings administration do to get out of this depression left by President Wilson? Government spending in 1922 alone was slashed by 34%. They reduced taxes on businesses and individuals from 73% to 24%. They also repealed a lot of the costly government bureaucratic regulations on businesses. The result was a huge increase in tax revenues and prosperity, as has always happened when government intervention in the economy is reduced.
We had the roaring twenties, the time of the greatest economic and technical improvement in the standard of living of the American people in our history....
(Excerpt) Read more at academia.org ...
There’s a reason John Galt and the Atlases of the world went on strike rather than try to use logic to justify their position:
So long as people are able to escape the full consequences of their actions, they’ll always find a way to deny that their actions were the cause and thus keep trying them.
Consider that communism has been a brutal failure everywhere it’s tried, yet there are people clamoring for it here in America of all places, with those demanding it claiming that the failure were not true communism. Why is that? Because they’ve never had to personally face the effects.
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