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To: Conservative Coulter Fan
When FDR took office, unemployment was, as you note, at something like 28%. In the late 1930s, before American entry into World War II, unemployment had been reduced to something like 10%.

Therefore, I'd be inclined to agree with you that the war -- sometimes referred to as "military Keynesianism" -- was not the key or sole factor in ending the Depression. What you have to account for, though, is that something happened during FDR's first several years in office. Conditions were markedly better than they were at the time of his inauguration.

So, in your view, what caused the huge decline in unemployment under Roosevelt?

And if you answer "buy my book," you will be sentenced to jogging three laps around the FDR Memorial. :)
2 posted on 04/21/2009 5:43:22 PM PDT by Eagle Forgotten
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To: Eagle Forgotten

“During the war the government pulled the equivalent of 22 percent of the prewar labor force into the armed forces. Voila, the unemployment rate dropped to a very low level. No one needs a macroeconomic model to understand the event.” ==Robert Higgs


3 posted on 04/21/2009 6:00:48 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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To: Eagle Forgotten
We no what the "something" was in FDR's first several years, I defer to Jim Powell, "The New Deal tripled federal taxes between 1933 and 1940 -- excise taxes, personal income taxes, inheritance taxes, corporate income taxes, dividend taxes, excess profits taxes all went up, and FDR introduced an undistributed profits tax. A number of New Deal laws, including some 700 industrial cartel codes, made it more expensive for employers to hire people, and this discouraged hiring.

Frequent changes in the tax laws plus FDR's anti-business rhetoric ("economic royalists") discouraged people from making investments essential for growth and jobs. New Deal securities laws made it harder for employers to raise capital. FDR issued antitrust lawsuits against some 150 employers and companies, making it harder for them to focus on business. FDR signed a law ordering the break-up of America's strongest banks, with the lowest failure rates. New Deal farm policies destroyed food -- 10 million acres of crops and 6 million farm animals -- thereby wiping out farm jobs and forcing food prices above market levels for 100 million American consumers."
4 posted on 04/21/2009 6:04:56 PM PDT by Conservative Coulter Fan (I am defiantly proud of being part of the Religious Right in America.)
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To: Eagle Forgotten
So, in your view, what caused the huge decline in unemployment under Roosevelt?

For God's sake, man, don't underestimate the ability of citizens to try and better their own lot. FDR threw every possible obstacle in the way of Americans who wished to work harder and profit from it. But despite his misguided efforts at government planning, individuals continued to strive and, amidst all the barriers to progress, managed to take America from Depression to mere recession.

To claim that reducing unemployment to a mere 10% is somehow an accomplishment is to remove all meaning from the word. If government had kept out of the people's economic affairs, the Depression would have disappeard by 1934 or 1935 and would be nothing but a footnote now.

5 posted on 04/21/2009 6:06:34 PM PDT by BfloGuy (It is not from the benevolence of the butcher, the brewer, or the baker, that we can expect . . .)
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To: Eagle Forgotten
I'm no big fan of Robert Higgs. He completely denies the impact of WW II spending (and forced savings) in causing the recovery. But there is a terrific new book out there on the New Deal by Burton Folsom:

New Deal or Raw Deal?

6 posted on 04/21/2009 6:08:58 PM PDT by LS ("Castles made of sand, fall in the sea . . . eventually." (Hendrix))
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To: Eagle Forgotten
When FDR took office, unemployment was, as you note, at something like 28%. In the late 1930s, before American entry into World War II, unemployment had been reduced to something like 10%.

I'd suspect a fair amout of the reduction could very easily have come from the creative minds of the beltway bureaucrats.

7 posted on 04/21/2009 6:09:25 PM PDT by tacticalogic ("Oh bother!" said Pooh, as he chambered his last round.)
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To: Eagle Forgotten

The premise of your question is incorrect. Unemployment never made it back down to 10% before the war... I didn’t think so.. as, I’ve read several times that 1938 was a VERY bad year, economically... the following are statistics from the US.Gov, Bureau of Labor Statistics:

Year Unemployment rate
1923-29 3.3
1930 8.9
1931 15.9
1932 23.6
1933 24.9
1934 21.7
1935 20.1
1936 17.0
1937 14.3
1938 19.0
1939 17.2
1940 14.6
1941 9.9
1942 4.7


45 posted on 04/22/2009 5:43:00 PM PDT by SomeCallMeTim
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