@HR
"FDR - Rescued America from the Great Depression. The Soviets may have won WW2, but America rescued the world economy."
reasons why FDR sucked:
1. the banking holiday, one of his first acts in charge, allowed banks to only open back up after going through intense scrutiny by the government. instead of letting banks fail this led to a series of what we now would consider "bail outs" although at the time they were simply issued as bank supports. this of course was all from taxpayer money, and the banks that had been complicit in accruing such massive credit were allowed to survive: AND still demand recompense from the populous. many banks WERE simply shut down, but surprise surprise many of the big ones were simply split up through the glass-steagall act, despite ones like JP Morgan actually being much more fiscally responsible. because why punish the people who actually CAUSED the problem?
2. destroying the gold standard. perhaps this needed to be done, but during the depression this did not help. his gold confiscation policy (where libertarians scream "theft" BUT THEY'RE ACTUALLY RIGHT!) allowed him to nationalize the monetary gold stock, and despite his artificial increase in the price of gold by 69% (in an attempt to fund government programs) the market price of gold only increase by about 7% in 1933, then flatlined. thus he stole from people, and destroyed a vital economic tool.
3. agriculture. do you want to know why in the modern era about 40% of all for doesn't even make it to market?? it all dates back to the price supports, subsidizing, and paying farmers not to produce of FDR. he decided everyone in the nation needed to eat, and how would he do this... by... raising the market price? what? but sadly yes he wanted fewer surpluses... so he paid farmers not to produce extra. and of course farmers DID produce extra, so they could be paid not to bring it to market. where did this money come from? the AAA (agricultural adjustment act) taxed companies making farm products. needless to say, larger companies abused this system, and smaller farms were destroyed. keep in mind this is the same time as the dust bowl in Oklahoma, and FDR had created a system causing MORE overproduction of food. what a nice man.
4. he created legislation setting minus wages, maximum hours, and working condition quotas. besides further creating monopolies, minimum wages laws ran directly in line with a new surge in unemployment, the maximum hours actually hurt the poor disproportionately, and working condition laws were most strictly enforced on smaller businesses. now i'm actually much more liberal with some of the policies than my conservative counterparts on this forum, but FDR's extension of power was one step short of nationalization of industry.
5. the NRA (National Recovery Administration) then created over 700 new codes for businesses: which of course the bigger businesses could easily hire lawyers to deal with, whereas smaller businesses took a big loss. the supreme court actually tore this down in 1935.
***keep in mind, these all occurred in the early 1930s: and the depression only got WORSE after they were instituted.***
so when DID the depression end? many people say WWII, but if you look at unemployment, stock and market health charts, you see a sharp drop in 1937 then an increase in all of them, then another massive drop in about 1939. the first drop in unemployment and the like in 1937 came after 6-7 years of diminished supply, which invariably led to an increase in demand. although this caused a slight recovery, restrictive policy caused another contraction. however FDR in 1937 wanted to pack the courts with liberal judges to stop "obstructionist" conservatives, and while the blackmail worked and conservative judges started to vote more his way, congressional opponents used the scheme to prevent many new programs. this is why we had 14% unemployment in 1937, and when tax hikes came in 1939 unemployment rose back to 19%.
remembering we didn't even enter the war until 1941, the years prior where the economy began to grow again was not a result of FDR's policies: and when he got back to spending when WWII approached, the economy hesitated again. when we did join up in WWII, we see another industrial increase caused by the war time nationalization of industries, however DURING WWII we actually see a harsh decline in Domestic GDP. most of our industrial assets had been mobilized for overseas activity. many people during WWII actually feared ANOTHER depression. As war production expanded from roughly 2% of GDP to almost 40%, statistically, America rebounded. In 1940 dollars, GDP shot from $101.4 billion to $120.7 billion in 1941 up to $174.8 billion by 1945 while unemployment fell below 2%. all the while, private consumption had been curbed. in fact the 1929 standard of living levels only came back in 1945, after the conclusion of the war.
the great rise in GDP and lowering of unemployment was primarily on the back of wartime employment and tanks, guns and planes and all sorts of military equipment: that never reached the open market. these were counted as a part of GDP, but GDP is made up of 4 parts:
consumption / government expenditures / investment / net exports.
what happened to our economy was a massive expansion of government expenditures, and we didn't actually have a recovery of consumption and investment until after the war ended and businesses were put back to the hands of the private businesses. the economic spending and seizure of taxes massively increased the role of the federal government. in 1946 we saw Republicans sweep congress, and the overregulation and government planning was brought to a head. Dropping from 42 percent of GDP to 14 percent, government spending plummeted by a total of 61 percent between 1945 and 1947. One hundred fifty thousand government regulators were laid off, along with perhaps a million other civilian employees of government. on paper this looks bad, but the unemployment rate dropped to about 4% for 1948, and in the 50s went to about 3%. many people attribute this to the 91% top income tax rate, but an actual analysis of tax collected shows exemptions, deductibles and other reductions in taxes meant the top income rate that was actually collected barely coveted the 30-40% range. meanwhile when JFK actually DID drop the rate to the 70% range, we actually saw a massive economic boom of growth at around 50% and income tax revenues increasing about about 40%.
the 50s and 60s still mark one of the greatest times of American prosperity in this country, and it all came off of a rejection of government's economic planning. as international competition grew and rising oil prices helped prompt the stagflation period of the 1970s, sadly people turned to more government regulation and control which did not help the situation. i'm actually more sympathetic to carter who caused us massive economic harm to stop inflation. he was put into a bad situation, and although his response wasn't stellar, he could have gone down a regulation path that made things MUCH worse.
Diplomacy Survival Game!
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