"The U.S. could have gotten out of the Great Depression any time is was prepared to spend the money"

[Better Believe It]

Weekend Edition February 17-19, 2012
And Other Fairy Tales
Revisiting the Second Great Depression
by DEAN BAKER
Dean Baker is the co-director of the Center for Economic and Policy Research (CEPR).

As President Obama’s re-election campaign heats up, there are several new accounts of his track record finding their way into print. One item for which he is undeservedly given credit is saving the country from a second Great Depression.

While the Obama Administration, working alongside Ben Bernanke at the Fed, deserves credit for preventing a financial meltdown, a second Great Depression was never in the cards. The first Great Depression was brought about not only from misguided policies at the onset of the financial crisis, but also from an inadequate policy response.

The spending associated with World War II ultimately got us out of the depression. There is nothing magical about spending on war; spending of the same magnitude on road, schools, hospitals or anything else also would have lifted out the economy out of the depression at any point after the initial collapse in 1929-1930.

The problem was the lack of the political will to spend in these areas, whereas there was plenty of political support for fighting the war after the attack at Pearl Harbor. The lesson from this period is that the United States could have gotten out of the Great Depression any time it was prepared to spend the money to do so. This means that a financial meltdown could not have possibly condemned us to a decade of double-digit unemployment, since that would require a decade of ongoing policy failures after the original collapse.

Read the full article at:

http://www.counterpunch.org/2012/02/17/revisiting-the-second-great-depression/

[Schema Thing]

1. illogical:

"This means that a financial meltdown could not have possibly condemned us to a decade of double-digit unemployment, since that would require a decade of ongoing policy failures after the original collapse. "



That's exactly what a decade of GOP rule would have given us, a "decade of ongoing policy failures".

[jwirr]

2. Would have given us? DID give us in a modern day context.

[Better Believe It]

3. Read the article more carefully. He's writing about policy responses during the 1930's depression.

There was no need for double digit unemployment until the Second World War.

That was in fact a policy failure.

Everyone understands that the massive war spending and moblization pulled us out of that depression.

But such a massive peaceful economic recovery program would have pulled us out of the depression well before the onset of WWII.

[bahrbearian]

4. Are you saying we don't need to attack Iran,,,but but, CNN says they are threating us.

Last edited Sat Feb 18, 2012, 09:31 PM - Edit history (2)

[FogerRox]

6. The decision to cut CCC & WPA spending by 60% in 1937

was quite fatefull.

GNP growth in 1934 was 11%, 1935=9%, 1936 nearly 14%, unemployment dropped, in 1936 non ag Unemployment dropped a hair below 10%, over dropped from 25%+ to 14.9%. SO it was clear the e3conomy was cranking and creating jobs.

And lets not forget that skilled labor shortages started for Gruman Aircraft in Long Island NY in Sept of '41, and that in early '42. barely 4 months after Pearl Harbor, Rosie the Riviter was a hit song

http://en.wikipedia.org/wiki/Rosie_the_Riveter

Labor shortages were full blown before the Yorktown saild into the Battle of Midway in June of 1942.

SO it did not take long to put people to work, suggesting that if we had not cut the WPA and the CC jobs stim in 1937, the US likely would have pulled out of the depression as early as 1939, certainly by 1941 at the latest.

[iemitsu]

5. and we've had three decades of ongoing policy failures.

how soon can we spend our way out of that?

[FogerRox]

7. 8-10% of GDP spent on jobs stim would

create 18 to 23 million jobs.

[Octafish]

8. Doing that wouldn't help the "scum de la scum," Wall Street's owners, the 1-percent of 1-percent.

Michael Parenti, courtesy of TUC (Time of Useful Consciousness) Radio, explains:

THE PATHOLOGY OF WEALTH

The first talk of 2012 by the social critic and noted author Michael Parenti fit perfectly into the debates of the time, that of the One versus the 99% and the finally no longer taboo question: What exactly is CAPITALISM? Parenti is debunking some of the myths of capitalism: That it creates jobs, peace, democracy and wealth - and more. In Part TWO Parenti describes the pathologies of capitalism by its inability to respond to climate change. Quoting a businessman in a New Yorker cartoon he reads: "While the end of the world scenario will be rife with unimaginable horrors, ..the pre-end period will be filled with unprecedented opportunities." Also in this segment arguments for the benefits of socialism in areas of our lives that should not be managed under the profit system. He lists health care, energy, and transportation.

Michael Parenti spoke on January 6, 2012, at the La Peña Cultural Center in Berkeley, CA. He is one of the nation’s leading progressive political analysts. Raised in a working class district of New York City, Parenti went on to earn a Ph.D. from Yale and lost his chance at an academic career when he openly opposed the war on Vietnam.
Thanks to John Parulis for the recording