We have all heard the stories about the Great Depression, and how FDR rode in on a white horse to save the day. By using new government programs, and huge increases in Government Spending, the argument goes, FDR brought our economy back to health. But is this really what happened?
According to a 2004 study by UCLA, his actions actually prolonged the Depression by 7 years. UCLA is hardly a bastion of Conservatism, yet it comes to the conclusion that if the government had not interfered with the U.S. Economy the Depression would have ended 7 years before it did.
From the UCLA article:
“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.” ….
“The fact that the Depression dragged on for years convinced generations of economists and policy-makers that capitalism could not be trusted to recover from depressions and that significant government intervention was required to achieve good outcomes,” Cole said. “Ironically, our work shows that the recovery would have been very rapid had the government not intervened.”
This seems to also explain why our current “stimulus” did not work. Yes, government spending can create a few short term jobs, however government sucking money out of the private sector, by excessive taxation, makes it a net loss.
Business is where the real jobs are made, not government. The fact is, Capitalism works.
Another point that is important to make, is the fact that excessive regulation on business, hurts job creation. This is well illustrated in a recent question a farmer asked the President, who suggested the farmer call the Department of Agriculture about the regulation.
Reporters who followed up to get an answer from the Department of Agriculture, found the same bureaucratic nightmare that anyone faces when trying to get answers from an overreaching government.
After several days of trying, and being passed from this department to that department, from the Federal Government to state and local government, they still got no answer to the initial question.
The real truth is the government is a great job killer and not a good job creator. Those looking back to FDR found that simple truth out so when will the Obama administration figure that out?
President Franklin D. Roosevelt