jpete wrote: stockingfull wrote: jpete wrote:
Stocking, if Hoover had done "nothing", we might not even talk about 1929. The fact of the matter is that he did "something". It was the wrong thing and we know what happened. Do a little research on the market crash of 1920-1921. It's hard to find info on it because the government did NOTHING. Over 500 banks closed and the market tanked due to WWI debt. You've never heard of it because it lasted less than a year. Compare the to FDR and Bush/Obama. In my expirience, in any crisis, the person screaming "We HAVE to do SOMETHING!!!" is about to do the WRONG thing. Sometimes nothing is the right thing. When you're lost in the woods, sit down and don't do anything.
This observation has been made before here and, to me, it just doesn't withstand the most superficial scrutiny.
Harding is rated as a President even more deficiently (38/42) than Hoover (34/42) and Dubya (36/42). So, if his response to the "crash of 1920-21" was so exemplary, I have a couple questions:
1. How is it that this wonderful model wasn't followed by Hoover in 1929? (Are we even sure he didn't?)
2. How is it that FDR didn't return to it when he took office in 1933?
3. How come we haven't heard it mentioned more widely since the current meltdown began last September?
4. With all the experts economists (many of them Republicans, especially last fall when it started!) who've studied the crashes and the Depression, how is it that there wasn't a robust debate about this wonderful 1920 approach when, or before, Bush threw $350 Billion at the banks with virtually no strings attached within a couple days of the crash?
5. Has this notion (that Harding's 1920-21 response was so darned good) been run through Snopes?
There's no need to even bother looking at this model, IMO, in the complete absence of any circumstantial indication, whether in history, or by current economic experts, or in any other way, that it was worth a *censored*.
So if there is a "successful" (ie. no long term depression) then we can't look at it to see what was done?
1) Yes, we are sure we passed the "Smoot-Hawley Tariff Act". That counts as "something" rather than "nothing"
2) FDR was of the opinion of the current president that only government can solve our problems.
3) Anyone who doesn't agree with the current administration is demonized or ignored.
4) Are these the same "experts" that brought us the current situation? They don't seem to be working out.
5) Who snopes Snopes?
You get your experts, and I'll get mine and we'll let them go at it "Thunder Dome" style. Deal?http://www.cato.org/fiscalreality
Jeff, the problem with the "Cato List" and with your argument is that you can't blame it on the "godless, pointy-headed liberals" this time. All this started in September 2008 with the failures -- and IMMEDIATE bailouts -- of AIG and the bankers. Just as a tiny point of information -- in case people have forgotten -- not only wasn't Obama the President then, the election was a month and a half away. Sure, there were people in the GOP who opposed the banking bailouts; but they didn't even carry the day in the Republican party!
After that time, there was a continuing campaign, including a number of debates between the presidential candidates. At no time did I hear either of them endorse the "old-tyme economic religion" which the Cato List (including one 89 year-old Nobel laureate and a bunch of lesser-magnitude economics professors with tenure) represents. But I'm not relying on the "Thunder Dome" cred match you suggest, because it's not necessary. Your own party's president
didn't choose to follow this school of economic thought before January 20, 2009, and neither did the American public in the last election. The argument over which is the right path is over; the choice has been made by both parties and by the American voters in what was about as close to a plebiscite on the issue as you can get.
In the end, as I've said before, nobody's got a reliable crystal ball, nor is there any guarantee that either side is right. But the leaders of both parties AND THE AMERICAN PEOPLE
have cast their lot with the deficit-stimulus approach. So the best that can be said of your thesis at this point is that it occupies the enviable position of the "alternative not chosen," in case the whole thing doesn't work.
We're in what's called "full-scale testing" now.