Time: What U.S. Economic Recovery?

[Hubbs]

I assume that government spending is part of GNP.

I assume that individual spending is part of GNP.

I assume that corporate spending is part of GNP.

Does that mean that when we're discussing GNP, that I should pull "Well, I refuse to count this part of GNP"?

Again, my assertion is that the person who has to spend several paragraphs telling you which things to ignore and which things to revise and which tings to change the definition of, is the guy who's cherry picking his data to fit his agenda.

GNP is a nice, traditional, measurement of economic activity. Far as I'm aware, it's the best, most frequently used, measurement. I didn't shop around to try to find the measure that fits my agenda.

(I didn't even shop around for a graph that looked more dramatic than any other. I used Google images, searched for "GNP Great Depression", and I think it was the first one that came up.)

(It did seem to come and go, when I was trying to find it again. So I did download it to my PC, reduce the size to fit what I assumed was a typical PC screen, and put it on my photobucket page.)

A couple more quick thoughts:

1) I made sure in my question to say that it would be just as foolish to throw out your data as it would be to use it as our only guide. There was a reason for this. The reason is... *dramatic pause*... it would be just as foolish to throw out your data as it would be to use it as our only guide.

2) If we're going to say that we should ignore anyone who has to use more than two or three sentences to analyze economic data, then I humbly submit that we should never listen to any economist ever again. Especially the ones that have published studies of Great Depression data in support of any theory about what worked and what didn't. Bunch of windbags, they are.

3) The only reason I'm even bothering to make this post is because I actually want to go back and read yours in detail, then respond. I'll promise not to dismiss anything you say that's longer than a tweet if you'll afford me the same courtesy.

4) My current theory about the Great Depression and the postwar boom is, I believe, a bit unorthodox. My guess is that when you read it, you won't think, "Just another partisan trying to squeeze the statistics until they say what he wants them to say."

Sound good?

EDIT: And just to tack on a thought to techboy's post, I'm going to claim that the Great Depression didn't end in 1941. So I get to enjoy attacks from everyone! Wheee!

[Prosperity]

Sorry, Larry. The Great Depression ended in 1941.

your sources say 1939

[Larry]

I'll also point out: I'm not even debating when it ended.

Actually, you are, and doing a pretty lousy job of it, too.

Yep, you caught me.

After spending five pages, and clearly stating several times what my point was :

The recovery started just as soon as [FDR implemented his policies].

The economic recovery happened within months of FDR taking office.

If, by "jumping off the 10th floor instead of the 12th", you mean "After falling an average of 8% per year, for three years, the decline stopped, then grew for 10% per year, for the next three years", you're right.

Well, more accurately, People who will do anything to revise history will actually go so far as to try to argue that the US economy is so good, that it began to recover in 1933, because of a war that started in 1942.

Now if only there were some way to use that paragraph to explain why the recovery began in 1933.

And having people respond with "well, the recovery didn't end until . . . " (and arguing that the credit for the recovery doesn't belong to the person who pointed the bus back towards the road, it belongs to the guy who owns the gas station that the bus stopped at, after it got back to the road.)

I did make one post in which, in one place, I stated that it ended in 34. (And then went on to show that I was still talking about the person who put the ship back on the right course.)

The depression ended in 1934. Because a depression ends when GNP begins to stop declining, and increases.

Yes, I'm well aware that if you desperately want to make bogus claims about the depression, and if you're willing to cherry pick your standards to fit that agenda, then all you have to do is:

• Hunt around for the economic indicator which always recovers last.
  
• Insist that recovery doesn't begin until that indicator has risen so far tha it has wiped out all losses. That, when a person has fallen off a cliff, his situation hasn't started to get better when he stops falling. No, he hasn't started to recover until he's climbed all the way back to the top of the cliff. All of the time he was climbing back up, he was still falling off the cliff.
  
• Ignore the fact that the metric which you've cherry picked is not only a trailing metric, but is the most trailing metric there is.
  
• And instead, assert that this metric is not only a leading metric, but that it actually reacts to things that haven't happened yet.

Yep. I said something wrong. In one post out of several on the subject. In one line of that post.

Please consider this my apology.

----------

My point stands.

The actions FDR took, upon taking office, caused a spectacular shift in the health of the US economy. Three years of constant, rapid, decline, were followed by four years of constant, rapid growth.

The patient was shot in 29.

In 30, he lost 10% of his blood.

In 31, he lost another 10% of his blood.

In 32, he lost another 10% of his blood.

In 33, a new doctor took over his case, and stopped the bleeding.

In 34, the doctor replaced 10% of the blood he lost.

In 35, he replaced another 10%

In 36, he replaced another 10%, thus replacing all the blood he lost, and more.

In (let's pick the most extreme number, and say "in 41"), the patient walked out of the hospital under his own power.

In 42, the hospital changed ownership.

The credit for saving his life doesn't go to some business transaction that happened after the patient walked out the door. It goes to the doctor who changed the patient's progression from "losing 10% of his blood per day" to "gaining 10% of his blood per day".

[wilsonian]

This is the intellectual equivalent of claiming CPR doesn't work by demonstrating it on a corpse. Because that is exactly what Hoover did close to 3 years after the crash.

Comparing that to Bush's TARP is at best dumb, at worst a lie. And I tire of reading it again and again on this board by people attempting to re-write history in an attempt to cling to their failed idealogy.

On November 18, 1929, he held a series of conferences at the White House in which he convinced the leading financiers and businessmen to keep wages artificially high, twenty-five days after the stock market had crashed on October 24, 1929. This undoubtedly caused the unemployment rate to jump from 3% in 1929 to 8.9% in 1930 to 15.9% in 1931. In January of 1930, Hoover instituted a vigorous public works program. On June 17, 1930, Hoover signed the Smoot-Hawley Tariff into law.

Economist Don Boudreaux points out the following:

From 1928 to 1929, federal government real per-capita spending rose by 4.7 percent; from 1929-30 by 8.0 percent; from 1930-31 by 17.2 percent; and from 1931-32 by 15.8 percent. (This spending rose by another 28.4 percent from 1932-33.) The overall increase in real per-capita spending from 1928 to 1932 was a whopping 53.5 percent. Real per-capita spending excluding outlays for defense and interest on government debt increased during Hoover’s years in office even more dramatically, skyrocketing by 130 percent.

Hoover didn't waste time intervening. And when he saw his Keynesian policies failing, he took even more aggressive action. This is not re-writing history at all. He spent like crazy, ran up huge deficits, bailed out shaky businesses, and enacted inflationary monetary policy. Just like Bush.

If Hoover's "doing nothing" really did cause the Great Depression, like you say, how do you explain the depression of 1920-1921 that I mentioned in my post? It was worse than any single year of the Great Depression, and yet it was over in a year. But the government did nothing. In fact, it shrank itself. How can that be? Wouldn't the patient die, as you suggest?

Furthermore, if you are suggesting that the free market ideology has failed, I suggest you reconsider your position. Why is it that the most ardent free market economists predicted the financial crisis and economic bust of 2007, while everyone else was completely clueless? Were they repudiating their own position?

Peter Schiff, a free market economist, wrote a book in February 2007 predicting exactly how the financial crisis was going to unfold. Around the same time, our noble savior

was going on television telling everyone that there was no housing bubble and that the sub-prime crisis was contained.

, the old lunatic that everyone loves to smear, was warning about the housing bubble in 2001. You know, 6 years before the bubble burst. But you're right, the free market ideology has failed.

Wait, you just told us there wasn't a Depression.

Go back and re-read my post. I was referring to the "Long Depression" of 1873, which someone had claimed was evidence of a depression caused by the government doing nothing. I showed that, in fact, the opposite was true - - that there was no depression. I never said there wasn't a Great Depression. I actually said that the Great Depression lasted for 18 years.

[Larry]

4) My current theory about the Great Depression and the postwar boom is, I believe, a bit unorthodox. My guess is that when you read it, you won't think, "Just another partisan trying to squeeze the statistics until they say what he wants them to say."

If I'm getting your question correctly, the answer to "why did I pick GDP as my metric" was "because as far as I know, it's the most well known metric. Almost universally used as a measure of a nation's economy."

No, I have no particular reason to insist that it's the only acceptable metric.

[techboy]

your sources say 1939

The ones that say that say "about" 1939, which just reinforces my point. It's a slightly nebulous historical term, not an economic term that can be pinpointed with precision data.

I did make one post in which, in one place, I stated that it ended in 34.

And this is the post I was disagreeing with. You'll notice I ignored the rest.

It's partly nitpicking, but it is important to the larger point I think.

The claim was made in this thread that FDR's policies prolonged the Great Depression.

One of your counterpoints was that no, it ended in 1934, which is just not true.

Since it actually ended much later than that, the discussion gets a bit messy.

It is not enough, as you have been doing, to simply point at the numbers and say "Look! The economy was consistently improving throughout FDR's policies!", because while the first is undeniably true, it ignores the very real point that it is at least possible that had FDR not implemented those policies, the economy would have gotten better, faster, i.e. his policies extended the Great Depression. All the raw numbers in the world can't dispute that point.

We don't live in a sci-fi story where we can open a wormhole to an alternate dimension where FDR didn't implement his policies so we can compare, so the only thing we're left with is economic models. The kind you deride, but the only way to analyze things sensibly.

Now, my personal opinion:

I happen to think that a very strong case can be made that FDR's policies extended the Great Depression. In particular, there was a study out of UCLA a couple of years ago that looked at FDR's (illegal) attempts at price and wage fixing, and analyzed their impact.

I also think, however, that FDR did a fantastic job of holding the country together at a time when fascism was sweeping the globe and toppling governments, and I'd suggest that there is a very real possibility that had we had a Murray Rothbard type as President instead, while his policies might have been more purely correct, he might have lost that head full of the great ideas, and our democracy to boot, before they had a chance to work. The President needed to been seen as doing something, and FDR did a fantastic job of that.

So, even if FDR was wrong (and I suspect he was, actually), he was right.

[Larry]

1) Oh, I'm well aware that it's possible for people to announce that "Well, FDR didn't make things better as quickly as I would have, if I'd been in charge",

But that's not "FDR made it worse". That's "FDR made it better, but not as well as this theory I've got".

But I'm not comparing the lines on those graphs against some imaginary line I've made up, after the fact.

I'm comparing the actual "with FDR" line to the actual "without FDR" line.

Now, if you want to argue, say, that "FDR's actions brought the economy back, but they also incurred a huge debt. And the only reason that debt didn't cause a bigger problem, 10 years later, was because of WW2.", then well, that's a statement of theory, but it's a theory I don't think is easily refuted either by logic or by history.

But if your statement is "FDR's actions made the economy worse", or "the economy grew by 10% in 33, 34, and 35, because of WW2", then those statements are ridiculously easy to disprove, simply by pointing at the actual history.

2) If y'all are going to start pointing out economic theories and "what if"s at me, I have to say that odds are, they're going to go right over my head. My "skill level" on that subject is about the level of "I can point out things that any idiot can see for himself".

3) And I'm going to be attempting to take Mom to Disney, in an hour or two. My ability to engage in hypothetical discussions, on Tailgate or anywhere else, is going to be really limited for the next four days.

(Assuming that we actually make it to Disney. Mom has been getting more and more depressed for a couple of weeks. I'm not going to be at all surprised if she does like she did before: Wait till we're halfway there, and then insist that we have to turn around and go home.)

[Henry]

If Hoover's "doing nothing" really did cause the Great Depression, like you say, how do you explain the depression of 1920-1921 that I mentioned in my post? It was worse than any single year of the Great Depression, and yet it was over in a year. But the government did nothing. In fact, it shrank itself. How can that be? Wouldn't the patient die, as you suggest?

I wish I had time to address your posts fully, but I'm swamped at work and my wife is sick and the kids are all over me. I will say that the recovery of the 20s was not a full recovery and largely an illusion, exclusive to whites in urban centers. Agriculture in particular took a hard hit during that decade, was completely ignored by the Coolidge administration and didn't recover for 20 years. In fact, much of our country's economic struggles were ignored in the 20s because of the financial bubble, which only made the crash of '29 that much more devastating. Other industries that should have been stable and therefore capable mitigating the depression were not.

Also, the Great Depression was a economic catastrophe on a global scale. Much of our own troubles were tied to those of other nations. For example, in 1931 Britain took itself off the gold standard and defaulted on gold payments, which ground international commerce to halt. Very large economic superpowers were panicking and circling their wagons. All of this contributed to our depression in unprecedented ways. I think Techboy's method of comparing this depression to previous ones is just as flawed as looking at charts in a vacuum. This was not something that was seen before in a world economy in which the worlds powerful economies were so closely tied together.

I'm not familiar with this guy Higgs and I haven't had a chance to read that link, but when I do I'll address more of all this. Right now the kids have swim practice.

[Prosperity]

The ones that say that say "about" 1939, which just reinforces my point. It's a slightly nebulous historical term, not an economic term that can be pinpointed with precision data.

so how about "mid to late 30's" ?

[techboy]

1) Oh, I'm well aware that it's possible for people to announce that "Well, FDR didn't make things better as quickly as I would have, if I'd been in charge",

It's also at least possible that the economy would have recovered quicker had FDR done nothing, and in that case, he did in fact make it worse.

That's why you can't just point at the raw numbers. It's impossible to say how much better or worse it would have been without those policies, without deeper economic modeling.

I understand that you don't feel qualified to analyze that, and I suspect few if any on this board are (maybe mcsluggo), but that doesn't mean we get to handwave them out of existence.

Do you allow people to handwave human influenced global warming research because they don't understand the science? I'm pretty sure you're not a climatologist either.

Enjoy Disney. I hope it goes well:)

so how about "mid to late 30's" ?

How about no? The earliest I can find in the various sources is 1939, and I suspect again that this is for convenience, because it makes a nice neat decade. Most sources go with 1941, like the Library of Congress.

[Prosperity]

hey man, I was just trying to be imprecise cause there was no precise data around

[techboy]

Now this is fascinating. I was going to try to dig up that UCLA study I was talking about, and I wanted to counterbalance it with something from the other side, so I was looking up some old Krugman articles, because I know he's been very critical of the argument that FDR's policies extended the Great Depression. His position is critical of the idea that FDR extended the Great Depression, as I remembered, but look at this:

Can Mr. Obama achieve something comparable? Rahm Emanuel, Mr. Obama’s new chief of staff, has declared that “you don’t ever want a crisis to go to waste.” Progressives hope that the Obama administration, like the New Deal, will respond to the current economic and financial crisis by creating institutions, especially a universal health care system, that will change the shape of American society for generations to come.

But the new administration should try not to emulate a less successful aspect of the New Deal: its inadequate response to the Great Depression itself.

Emphasis mine. Say what?

Now, there’s a whole intellectual industry, mainly operating out of right-wing think tanks, devoted to propagating the idea that F.D.R. actually made the Depression worse. So it’s important to know that most of what you hear along those lines is based on deliberate misrepresentation of the facts. The New Deal brought real relief to most Americans.

Oh, okay. Continuing...

That said, F.D.R. did not, in fact, manage to engineer a full economic recovery during his first two terms. This failure is often cited as evidence against Keynesian economics, which says that increased public spending can get a stalled economy moving. But the definitive study of fiscal policy in the ’30s, by the M.I.T. economist E. Cary Brown, reached a very different conclusion: fiscal stimulus was unsuccessful “not because it does not work, but because it was not tried.”

This may seem hard to believe. The New Deal famously placed millions of Americans on the public payroll via the Works Progress Administration and the Civilian Conservation Corps. To this day we drive on W.P.A.-built roads and send our children to W.P.A.-built schools. Didn’t all these public works amount to a major fiscal stimulus?

Well, it wasn’t as major as you might think. The effects of federal public works spending were largely offset by other factors, notably a large tax increase, enacted by Herbert Hoover, whose full effects weren’t felt until his successor took office. Also, expansionary policy at the federal level was undercut by spending cuts and tax increases at the state and local level.

And F.D.R. wasn’t just reluctant to pursue an all-out fiscal expansion — he was eager to return to conservative budget principles. That eagerness almost destroyed his legacy. After winning a smashing election victory in 1936, the Roosevelt administration cut spending and raised taxes, precipitating an economic relapse that drove the unemployment rate back into double digits and led to a major defeat in the 1938 midterm elections.

What saved the economy, and the New Deal, was the enormous public works project known as World War II, which finally provided a fiscal stimulus adequate to the economy’s needs.

Emphasis mine. So apparently, Larry, Mr. Conscience of a Liberal and Nobel Prize winner Paul Krugman, actually disagrees with you, and says it was World War II that ended the Great Depression, not FDR.

Of course, the fact that Mr. Keyensian himself would say this just highlights the irony I was pointing out earlier.... the idea that WW II ended the Great Depression is about at Keynesian as you can get,

In a different piece, Krugman gives FDR a pass, because:

FDR might have been more of a Keynesian if Keynesian economics had existed — The General Theory wasn’t published until 1936.

Fair enough.

Oh, and Here's a press release for the UCLA study:

Two UCLA economists say they have figured out why the Great Depression dragged on for almost 15 years, and they blame a suspect previously thought to be beyond reproach: President Franklin D. Roosevelt.

After scrutinizing Roosevelt's record for four years, Harold L. Cole and Lee E. Ohanian conclude in a new study that New Deal policies signed into law 71 years ago thwarted economic recovery for seven long years.

"Why the Great Depression lasted so long has always been a great mystery, and because we never really knew the reason, we have always worried whether we would have another 10- to 15-year economic slump," said Ohanian, vice chair of UCLA's Department of Economics. "We found that a relapse isn't likely unless lawmakers gum up a recovery with ill-conceived stimulus policies."

In an article in the August issue of the Journal of Political Economy, Ohanian and Cole blame specific anti-competition and pro-labor measures that Roosevelt promoted and signed into law June 16, 1933.

"President Roosevelt believed that excessive competition was responsible for the Depression by reducing prices and wages, and by extension reducing employment and demand for goods and services," said Cole, also a UCLA professor of economics. "So he came up with a recovery package that would be unimaginable today, allowing businesses in every industry to collude without the threat of antitrust prosecution and workers to demand salaries about 25 percent above where they ought to have been, given market forces. The economy was poised for a beautiful recovery, but that recovery was stalled by these misguided policies."

Using data collected in 1929 by the Conference Board and the Bureau of Labor Statistics, Cole and Ohanian were able to establish average wages and prices across a range of industries just prior to the Depression. By adjusting for annual increases in productivity, they were able to use the 1929 benchmark to figure out what prices and wages would have been during every year of the Depression had Roosevelt's policies not gone into effect. They then compared those figures with actual prices and wages as reflected in the Conference Board data.

In the three years following the implementation of Roosevelt's policies, wages in 11 key industries averaged 25 percent higher than they otherwise would have done, the economists calculate. But unemployment was also 25 percent higher than it should have been, given gains in productivity.

Meanwhile, prices across 19 industries averaged 23 percent above where they should have been, given the state of the economy. With goods and services that much harder for consumers to afford, demand stalled and the gross national product floundered at 27 percent below where it otherwise might have been.

"High wages and high prices in an economic slump run contrary to everything we know about market forces in economic downturns," Ohanian said. "As we've seen in the past several years, salaries and prices fall when unemployment is high. By artificially inflating both, the New Deal policies short-circuited the market's self-correcting forces."

Cole and Ohanian also wrote an op-ed about it here, which goes into a little more detail. They are pretty qualified:

Mr. Cole is professor of economics at the University of Pennsylvania. Mr. Ohanian is professor of economics and director of the Ettinger Family Program in Macroeconomic Research at UCLA.

I'd put up something by a qualified economist defending the New Deal as actually helping the economy, but I can't find anything at the moment.

[NoVaO]

The unemployment in the 30s was a little misleading. The unemployment rate included those working on emergency projects. So anybody employed under the WPA would be counted as unemployed.

Here is a comparison of what the unemployment would look like if those working on emergency projects (dashed line) were included and what unemployment looked like with those workers not included:

If you wanted to take Government entirely out of the equation and wanted to look solely at private non-farm jobs, we can do that too. It's the dotted line:

Also, a big reason we had a downturn in 1937/1938 was because of spending cuts, and New Deal programs were rolled back. Roosevelt mistakenly took the advice of those who advocated for austerity and who worried about the amount of debt the U.S. was piling up. Here is a letter from John Maynard Keynes warning Roosevelt about just that in 1938...

(1) I should agree that the present recession is partly due to an ‘error of optimism’ which led to an overestimation of future demand, when orders were being placed in the first half of this year. If this were all, there would not be too much to worry about. It would only need time to effect a readjustment;—though, even so, the recovery would only be up to the point required to take care of the revised estimate of current demand, which might fall appreciably short of the prosperity reached last spring.

(2) But I am quite sure that this is not all. The recovery was mainly due to the following factors

(i) the solution of the credit and insolvency problems, and the establishment of easy short-term money;

(ii)the creation of an adequate system of relief for the unemployed;

(iii) the public works and other investments aided by Government funds or guarantees;

(iv) investment in the instrumental goods required to supply the increased demand for consumption goods;

(v) the momentum of the recovery thus initiated.

Now of these (i) was a prior condition of recovery, since it is no use creating a demand for credit, if there is no supply. But an increased supply will not of itself generate an adequate demand. The influence of (ii) evaporates as employment increases, so that there is a dead point beyond which this factor cannot carry the economic system. Recourse to (iii) has been greatly curtailed in the past year. (iv) and (v) are functions of the upward movement and cease—indeed (v) is reversed—as soon as the position fails to improve further. The benefit from the momentum of recovery as such is at the same time the most important and the most dangerous factor in the upward movement. It requires for its continuance, not merely the maintenance of recovery, but always further recovery. Thus it always flatters the early stages and steps from under just when support is most needed. It was largely, I think, a failure to allow for this which caused the ‘error of optimism’ last year.

Unless, therefore, the above factors were supplemented by others in due course, the present slump could have been predicted with absolute certainty. It is true that the existing policies will prevent the slump from proceeding to such a disastrous degree as last time. But they will not by themselves—at any rate, not without a large-scale recourse to (iii)—maintain prosperity at a reasonable level.

Also, Hoover was not close to the deficit spender that Roosevelt was. Two graphs to illustrate this (numbers don't show up on background, but it illustrates the point):

Debt as Percentage of GDP starting in 1929 and ending in 1941

Debt in Millions of Dollars, also starting 1929 and ending in 1941.

If Hoover's "doing nothing" really did cause the Great Depression, like you say, how do you explain the depression of 1920-1921 that I mentioned in my post? It was worse than any single year of the Great Depression, and yet it was over in a year. But the government did nothing. In fact, it shrank itself. How can that be? Wouldn't the patient die, as you suggest?

1. There was no demand crisis with this depression, so fiscal stimulus wasn't really needed.

2. Do not discount the role that monetary stimulus played in ending this depression. Interest rates rose from 4.75% to 7% in a span of 6 months (12/1919 - 6/1920), which sharply cut the amount banks lent to each other, businesses and consumers. Interest rates then dropped from 7% to 4.5% from 7/1921 to 11/1921.

3. The shrinking you refer to occurred before the depression even occurred.

[mardi gras skin]

I wish I had time to address your posts fully, but I'm swamped at work and my wife is sick and the kids are all over me....Right now the kids have swim practice.

Henry's rolling hard today. This one's for you:

[Henry]

Henry's rolling hard today. This one's for you:

I am so there at the moment.

Oh and at the 2:00 mark ... that's pure gold.

[Larry]

It's also at least possible that the economy would have recovered quicker had FDR done nothing, and in that case, he did in fact make it worse.

You want to debate the definition of the term "worse"?

I think that term does indeed have a definition, and one way of expressing it is if the plot of (whatever you're measuring) has a negative slope with resoect to time.

10% growth in GDP may be "not as good as my theory". But "worse" is absolutely untrue.

"Worse" has a definition, and what happened when FDR took office is absolutely not it.

"Worse than some other fictional line", it might be. All you have to do is to draw a better imaginary line.

(And when you do, I'll point out that I know a place where I can find lots of people who think that the Redskins would have won more games if that person had been in charge, too.)

[techboy]

You want to debate the definition of the term "worse"?

No, but I will point out that you're not actually addressing the argument.

No one is suggesting that FDR made the economy worse from where he inherited it, in absolute terms. That's something the raw data can show.

The argument is that FDR's policies made the Great Depression worse, that if he had followed other policies, or even done nothing at all, things would have been better. That's the argument you need to address if you want to have a dialogue.

If, just as a hypothetical example, after doing nothing at all, the economy would have fully recovered in 2 years rather than over 10, that's important. That means FDR's policies made things worse.

You can call that "fictional", or handwave the models away in a fit of anti-academic fervor, but it's actually important in real life. We need to decide what policies were good and what policies were bad going forward.

[PeterMP]

No, but I will point out that you're not actually addressing the argument.

No one is suggesting that FDR made the economy worse from where he inherited it, in absolute terms. That's something the raw data can show.

The argument is that FDR's policies made the Great Depression worse, that if he had followed other policies, or even done nothing at all, things would have been better. That's the argument you need to address if you want to have a dialogue.

If, just as a hypothetical example, after doing nothing at all, the economy would have fully recovered in 2 years rather than over 10, that's important. That means FDR's policies made things worse.

You can call that "fictional", or handwave the models away in a fit of anti-academic fervor, but it's actually important in real life. We need to decide what policies were good and what policies were bad going forward.

The thing that I find people that are trying to make the argument that FDR made things worse fail to differentiate is the difference between 'policy X' didn't work vs. the totality of FDRs policies made things worse (or failed to make things better).

We can make a statement like:

"If FDR had not instituted certain policies, the economy would have gotten better faster."

vs.

"If Hoover had won the Presidencey, the economy would have gotten better faster."

The first doesn't mean the second is true.

[Larry]

No, but I will point out that you're not actually addressing the argument.

No one is suggesting that FDR made the economy worse from where he inherited it, in absolute terms. That's something the raw data can show.

The argument is that FDR's policies made the Great Depression worse, that if he had followed other policies, or even done nothing at all, things would have been better. That's the argument you need to address if you want to have a dialogue.

If, just as a hypothetical example, after doing nothing at all, the economy would have fully recovered in 2 years rather than over 10, that's important. That means FDR's policies made things worse.

You can call that "fictional", or handwave the models away in a fit of anti-academic fervor, but it's actually important in real life. We need to decide what policies were good and what policies were bad going forward.

Or I can point out the absolute, unchallenged fact that "FDR made it worse" is so untrue that even idiots can see it. Just like the claims that the credit for the recovery goes to WW2.

That's part of the problem in much political discussion today. A lot of statements which may have basis in reality, that are designed so that, when the statement is reduced a bit, the statement becomes completely untrue.

As an example, I'll point out that

"The last fiscal year before Obama took office, the federal deficit was X. The first fiscal year after Obama took office, the federal deficit was three times as much" is a true statement.

"Obama tripled the deficit" is completely untrue.

"FDR's policies didn't fix the economy as fast as some other policies would have" might be a true statement. (In fact, I'd say it's guaranteed, since the inverse of that statement would be "There is no possible scenario which wouldn't have produced worse outcomes.") It's even possible that there's sufficient science to support the claim of "this would have worked better".

However, simplifying that statement to "FDR made it worse", changes a statement which might be true, into one which obviously isn't.

---------- Post added June-19th-2011 at 11:29 AM ----------

We can make a statement like:

"If FDR had not instituted certain policies, the economy would have gotten better faster."

vs.

"If Hoover had won the Presidencey, the economy would have gotten better faster."

The first doesn't mean the second is true.

In fact, I would assert that the second statement can be easily disproven, simply by looking at history.

[Thiebear]

Some behind the scenes ass kicking on all the banks that entered the deal and took the money would be nice.

Once you take the money you have responsibilities to uphold.

[Hubbs]

Just like the claims that the credit for the recovery goes to WW2.

Wait, are you back to saying that the Great Depression ended in 1933?

[techboy]

Or I can point out the absolute, unchallenged fact that "FDR made it worse" is so untrue that even idiots can see it.

Only when you redefine it to mean something no one is claiming.

Just like the claims that the credit for the recovery goes to WW2.

I just quoted a couple of pieces, with analysis and citations of supporting research, by a Nobel Prize winning economist that claims that the Great Depression was ended by World War II.

Paul Krugman can be called a lot of things, not all of them good, but "idiot" is not one of them (nor, would I imagine, is the MIT professor he references. Just a guess, though.).

You don't appear to be willing or able to address the substance of the issue, beyond accusations of idiocy and dishonesty (seemingly in alternating fashion), so I think I'll leave it there.

---------- Post added June-19th-2011 at 04:31 PM ----------

As an example, I'll point out that "The last fiscal year before Obama took office, the federal deficit was X. The first fiscal year after Obama took office, the federal deficit was three times as much" is a true statement.

"Obama tripled the deficit" is completely untrue.

As a sort of final thought for your consideration, though, I'd suggest that the irony of this statement should cause you to engage in some self-reflection.

You're giving FDR complete credit for the turnaround that began the first year he was in office, but are unwilling to assign blame in a similar manner to President Obama.

[Larry]

Only when you redefine it to mean something no one is claiming.

Yeah, you're right.

Clearly

• Increasing GDP by 36%, in three years, and
  
• Reducing unemployment by 8% of the total workforce, or by 32% of the unemployed, in the same three years.

Fits the accepted, standard, definition of "making thinhgs worse".

Damn, I wish Obama would hurry up and make things worse.

As a sort of final thought for your consideration, though, I'd suggest that the irony of this statement should cause you to engage in some self-reflection.

You're giving FDR complete credit for the turnaround that began the first year he was in office, but are unwilling to assign blame in a similar manner to President Obama.

As a sort of final response I'd suggest the irony of accusing people of refusing to debate your point after a) spending three pages refusing to debate my point, and instead hammering on one sentence which was untrue, but which actually contradicted numerous starements of mine.

And closing by accusing me of intellectual dishonesty by claiming that I said something I didn't

The statement "Obama tripled the deficit" is an untrue statement. For numerous reasons. The one that's easist to demonstrate, though, is the fact that the deficit more than doubled, before he even took office.

You see, I'm unwilling to say that Obama tripled the deficit, for the same reason I'm unwilling to say that WW2 caused the recovery which eventially ended the Great Depression:

This pesky belief of mine that causes have to come before effects.

[techboy]

As a sort of final response I'd suggest the irony of accusing people of refusing to debate your point

It wasn't my point (at least this time). If it had been, you'd know it.

after a) spending three pages refusing to debate my point,

I had no interest in your point, except in the abstract.

and instead hammering on one sentence which was untrue

I only hammered because you wouldn't acknowledge it initially. I originally treated it as a point of historical curiosity (especially the part about Hoover's role in defining the term), which is how others treated it as well.

And closing by accusing me of intellectual dishonesty by claiming that I said something I didn't

I didn't accuse you of intellectual dishonesty. That's your schtick.

Personally, I wouldn't usually even consider assuming that I know somebody is lying without significant evidence to that effect (such as previous statements acknowldgeing the truth), even if I'm pretty sure I'm right about something.

There are so many other possible alternatives: a person might unknowingly be taking a internally contradictory position without realizing it, or he might not see the facts the same way I do, or he might not know the true facts.

I'm not a mind reader, and the charge of lying is a pretty serious one.

Generally, I'll just point out the apparent contradiction in a person's thinking, and let him or her sort it out.

In this case, I know you to be an intelligent person, and you seem to be earnest in debates, so I assumed that you were inadvertently holding to two contradictory positions, when it seems, in actuality, that you disagree with the presented facts. You say that President Obama was not in office the entire time the deficit tripled, which means instead that you disagree on the facts. For all I know, you're right about that, I was just going on what you seemed to be saying yourself. I don't actually know when or how much the deficit changed under President Obama, to be honest. I don't tend to involve myself heavily in political discussions anymore, so I never bothered to look it up.

[Hubbs]

So, Larry, if the "effect" is the end of the Great Depression, then you are saying that it ended in 1933, yes?