How we got out of the depression

[Kurt_and_Hunter]

We limped through the depression for more than a decade. Government spent enough to keep the system creaking along but not enough to really get anything started. When the government took its foot off the gas the economy would drop right back down to depression levels.

Then in 1939 we started spending a lot of money on WWII, even though we were not in it yet. The economy picked up.

Then in 1941 we went to war and government spending went through the roof. The economy was fixed!

Then the war ended. Why didn't we go back into depression? 1) pent up demand (no more rationing) and 2) high post-war inflation.

That's the story.

What we did during the depression did not work. It did what one could reasonably expect, but was simply too small to do more than put a floor under the down-side.

What Japan did in the 1990s did not work. It did what one could reasonably expect, but was simply too small to do more than put a floor under the down-side.

What we are doing in America today has not worked. It did what one could reasonably expect, but was simply too small to do more than put a floor under the down-side.

It seems to be a law of politics that in a severe demand crisis nations do just enough to scrape by in misery.

[hobbit709]

1. We just rebranded it.

[littlewolf]

2. one problem today is ... our manufacturing is gone ....

we are now more a service industry ....

[Warpy]

3. Actually, the programs were working and would have gotten us out

without a world war had a conservative Congress not forced a balanced budget and a premature end to all the programs that were working. Their cowardice and stupidity ushered in the Great Recession of 1937 and that is what prolonged the Depression and needed a world war to ramp up spending again and get us out.

[Kurt_and_Hunter]

5. I am talking about a nation, not a party

"we" (the united states) did not do enough.

Which party was more at fault for that is side-ways to the question of a democratic nation's ability to respond to a demand crisis. The thing is that we, as a national entity, *did* pull back after 1936.

The people cannot respond properly, as their current stance on things amply demonstrates.

Republicans are currently running on a platform of repeating the recession of 1937 and doing well with it.

[Warpy]

6. Those addlepated, balanced budget obsessed conservatives

were in both parties and that's what caused the nation not to do enough to end the Depression.

Dumbfuckery at the top prolonged the problem, not any lack of will at the bottom.

[Crazy Dave]

4. Our current government has a narrow one track mind for fixing the economy

Only tax credits for the middle and lower class folks but huge tax breaks, bail outs and hand outs to corporate America.

[Cirque du So-What]

7. For one thing

the infrastructure of European nations (friend & foe alike) and Japan were in ruins by the end of WW II and for several years afterward - Marshall plan notwithstanding. It's easy to dominate in manufacturing when most of the world's factories have been obliterated.

[The_Commonist]

8. I was just going to add that.

I think that may be the most important factor.
We didn't have any competition there for a while.

[Kurt_and_Hunter]

9. Our markets were hurt, though

Much of the rationale of the Marshall plan was because we were a net exporter back then (hard to recall such a thing today) and it was in our interest for the rest of the world to do better because that was who we sold to.

I am not discounting the benefits of our position, merely noting that the effect wasn't entirely one-sided.

[FirstLight]

10. well...

so WWII was one of the things to pull us OUT, way back when...

but the decade long War on Terror was also a huge factor to getting us here again ...

redirect the army, national guard etc to "rebuilding America"
take all that war money and BRING IT HOME...use it for uor infrastructure, use our best & brightest to find new and better energy efficiency methods, use all that man and woman power we have to spare and "git'er done!"

we have wind turbines to build, we have electric grids to fix and expand, we have freaking community garden projects to turn urban blight into something productive...and so much more

there's so much possibility ...but we will not see it unless we have some BOLD moves ...or maybe it IS something that starts at a grass roots level, but if the govt wants to make a big push for getting us out of the hole. We need to bring our focus back HOME.