One of the great things about sophistry is that in any argument there is always enough dust around to throw in people’s eyes. Whatever the argument, the dirt at your feet is always at hand.
One of the great things about intellectual honesty is that you don’t take positions without multiple sources of support. It helps you see through the dust, too.
A week ago I wrote about how spending under Obama has not been nearly as profligate as is widely thought. Marc Comtois, one of the dedicated soldiers of the right who daily lays waste to armies of straw men over at Anchor Rising, thinks he’s found a nut, and complains that an article I used in support of that essay had been amply refuted. (You can find his links in the comments over there.)
What he doesn’t get is that those refutations are just dust. One can go into the weeds of the refutations to show that they are just as tendentious as the original article they critique, but why bother? Even if you pretend the article I cited was all wet, there is ample other support for the assertion that if you really care about responsible spending, you shouldn’t vote for people who promise cheaper government.
So, for example, if you don’t like Mr. Nutting and marketwatch.com, how about the Center for Budget and Policy Priorities? Here’s what they say:
“By themselves, in fact, the Bush tax cuts and the wars in Iraq and Afghanistan will account for almost half of the $20 trillion in debt that, under current policies, the nation will owe by 2019. The stimulus law and financial rescues will account for less than 10 percent of the debt at that time. “
Oh, wait. You say CBPP is a partisan organization. Well then how about the Cato Institute? Its director, the late Bill Niskanen had a reputation for unyielding libertarianism, and also a reputation for intellectual honesty, part of what has made Cato a source of actually useful data over the years. He wrote an article some years ago pointing out that the “Starve the Beast” strategy of cutting taxes to force spending cuts did not work. In short, Republicans made deficits bigger and Democrats made them smaller. (Original article, recent follow-up.) I wrote a follow-up to Niskanen’s original article pointing out that the situation was even worse than he wrote (page 2 at the link).
In other words, pretty much any way you turn, evidence says that if you care about responsible spending, vote for the people who don’t focus on spending. Vote for the people who are talking about what government should do — they’re the ones who care enough about the enterprise to do it responsibly. And yes, any given article or set of numbers can be showered with dust, obscuring its meaning. But dust is for brushing aside.
Now, all that said, what do I think about this? In basic economics classes, we’re taught that the Great Depression was ended by demand-side spending — the spending necessary to fight a World War was of the scale necessary to bring our nation out of the economic funk of the 1930s. I believe that 50 years from now, students in basic economics classes will ask impertinent questions of their professors when they wonder why, with that example to go by, the world acted in precisely the opposite way when faced with the challenges of the Bush depression. The fact is that the last three years have seen ample confirmation of the theory behind Keynesian stimulus, but it’s all been in the wrong direction. We’re doing the opposite of stimulus, so we get the opposite of prosperity.
Which is all to say that I’m not defending the Obama austerity. I’m simply stating the fact that if you want responsible spending, the record — stretching over decades — says that voting for people who simply promise to make government cheaper is the wrong way to get it.
“we’re taught that the Great Depression was ended by demand-side spending”
I was taught that in history class, not economics. In economics I learned that we grew out of the Depression when the Federal gov’t cut spending (dramatically) and reduced the tax rates on individuals and businesses after the war, allowing the capital back into the economy where it could be put to use.
“Which is all to say that I’m not defending the Obama austerity”
Tom, please stop misusing that term. We haven’t tried austerity. Even using the axis-free graph you supplied, spending under Obama hasn’t decreased. Austerity requires a reduction in actual spending, not simply a slowing of the growth in spending.
“reduced the tax rates on individuals and businesses after the war”
Excuse me?
Check the graph
visualizingeconomics.com/2011/04/14/top-marginal-tax-rates-1916-2010/
You mean the graph that shows post-war income taxes dipping, then increasing, then holding steady at about 90% for fifteen years?
Or the graph that shows post-war corporate taxes increasing to 50% and holding steady for about thirty years?
Are those the post-war tax reductions you mean?
Did tax rates go down after the war ended? Irrefutably yes. When combined with the significant reduction in spending, it sent the message that the gov’t is getting its fiscal house in order and is reducing its burden on the private sector. That provided enough certainty and incentive to start investing in their businesses again. The rates were not increased for 5 years.
“The rates were not increased for 5 years.”
This is so great. You want to restrict the post-war period to 46-49???
Okay. Let’s be extremely precise. The Great Depression was over by 1940. 1942 at the latest.
You want to argue that tax reductions in 1946 ended the Great Depression in 1942?
By the time tax rates were increased, the economy was off and running again. The benefit of regime certainty and incentive to start investing again had already proved fruitful by reducing spending and taxes.
No, no. You said this: “In economics I learned that we grew out of the Depression when the Federal gov’t cut spending (dramatically) and reduced the tax rates on individuals and businesses after the war”
Which means that the tax reductions in 1946 ended the Great Depression in 1942 (or 1940).
Actually, it also means that the spending reductions begun in 1946 ended the Great Depression in 1942 (or 1940).
How exactly does this time-traveling confidence scheme work?
“ended the Great Depression in 1942 (or 1940).”
I’m sorry, I missed that nugget the first time. So you think that putting millions of people to work either building or dropping bombs on other people is the cure to economic depression? All that wartime spending did was trade unemployment for debt.
So the Great Depression ended in 1946?!? Or 1949?!?!
The Great Depression outlasted the Second World War, by a few years???
I don’t think you are putting yourself in the strongest position to refute Tom’s Keynesian take on the Great Depression.
well, when did the war end?
“well, when did the war end?”
Please tell me you’re not going to dispute the end date of World War II.
Look, the conventional understanding is that the Great Depression ended during the war. In my view, the Great Depression was pretty much shot by 39, though I accept that some people think it lasted until after Pearl Harbor.
It is quite heterodox to suggest the Great Depression lasted past 1942.
It is extremely heterodox to suggest the Great Depression lasted until 1945.
You are suggesting that tax and spending cuts enacted in 1946 ended the Great Depression, which means the Great Depression could not have ended until 1947 at the earliest.
Now, if you want to say that the libertarian narrative relies on a definition of the Great Depression that extends it into the late forties, I’m happy to agree that that is the libertarian narrative.
“Look, the conventional understanding is that the Great Depression ended during the war.”
I don’t dispute that from an strictly economic measuring perspective (so many months of X improvement in GDP or whatever the calc is) the GD ending in ’39-’41. But again, if you think the GD ended during the war, then you have to think that economic depression can be ended by putting millions of people to work building and utilizing war machines. I just can’t agree with that. Those war machines didn’t create anything but destruction, and you can’t create wealth by destroying it.
“You are suggesting that tax and spending cuts enacted in 1946 ended the Great Depression”
Well, the spending cuts happened almost immediately after the war ended because of lack of demand for munitions (don’t forget Keynesians of the time claimed without more gov’t spending we’d plunge into another depression). The tax cuts happened months later.
hey @steve ahlquist — thanks for all the thumbs down. I appreciate it.
“from an strictly economic measuring perspective”
“ In economics I learned that we grew out of the Depression when the Federal gov’t cut spending”
What?
”The tax cuts happened months later.”
You’re still saying the Great Depression ended in the late forties at the earliest, and you also said earlier that the cuts from 46-49 ended the Great Depression.
Any of these dates, from 46-50, places your definition of the Great Depression wildly outside the mainstream. You’re no longer discussing the same phenomenon as anyone else.
”don’t forget Keynesians of the time claimed without more gov’t spending we’d plunge into another depression”
There was a recession in 45 and another in 49.
“Those war machines didn’t create anything but destruction”
That’s a sweet sentiment. If you’d like to say that the entire US military budget doesn’t count as government spending, then…well, actually, I don’t even know where that would take us, but I’m pretty sure it wouldn’t work out too well for a libertarian.
“What?”
What exactly don’t you get? In order to understand why mainstream keynesian economists of the time were wrong, we had to learn what they were doing. So I understand why the mainstream economists then claimed the GD ended in 1939, and why mainstream economists now say the great recession ended in 2009 — because they met the GDP calc’s necessary to say they were over. That doesn’t mean the hurt was over in 1940 any more than the hurt was over in 2010.
“There was a recession in 45 and another in 49.”
Your mainstream economists were predicting a doom and gloom depression if the gov’t didn’t continue its spending trajectory after the war ended. The mainstream was wrong. It happens.
“If you’d like to say that the entire US military budget doesn’t count as government spending,”
Nice straw man. Care to try again?
“What exactly don’t you get?”
I don’t get why you’re flitting back and forth between definitions of ‘depression’.
Well, yes, I suppose I do get it.
“That doesn’t mean the hurt was over in 1940 any more than the hurt was over in 2010.”
So the Great Depression lasted until…when? You still haven’t given any firm answer.
“Your mainstream economists”
Mine?
“were predicting a doom and gloom depression”
But according to you they were right. After all, they said there would be a big downturn after the end of the war, and you say that the Great Depression lasted until 46 at least and possibly until 50.
If the Great Depression doesn’t count as a doom and gloom depression, what does?
“Nice straw man.”
??? You flat out said the production of military weaponry shouldn’t count as wealth creation: “Those war machines didn’t create anything but destruction, and you can’t create wealth by destroying it.”
It’s fine with me if you want to say that defense spending shouldn’t count as wealth creation, but, because GDP includes government spending, you’ll have to revise all accountings of GDP growth. Why should building nuclear missiles count any more than tanks?
Look, you’re completely off the rails here. You’re trying to introduce extremely idiosyncratic definitions of ‘depression’ and GDP. If you’re taking a radical position, you should really say so from the start, otherwise nobody knows what you’re talking about.
So, what do you mean?
You know there’s a standard definition of ‘depression’. What’s the definition you’re using? What’s the definition that extends the Great Depression deep into the forties, but doesn’t somehow result in turning the fifties and sixties into part of the Great Depression, too?
And how do we calculate GDP without including defense spending?
These are two highly unusual approaches to the issue, and they are both essential to your argument.
You might have laid them out from the start, rather than just let everybody figure out that you’d made up your own definitions.
“So the Great Depression lasted until…when?”
The real economic recovery started after the war ended and the gov’t lifted all the controls it placed on the economy and the market corrected for the reduction in military spending — so, 1946.
“You know there’s a standard definition of ‘depression’”
There is no agreed definition of the term depression
“And how do we calculate GDP without including defense spending?”
I’m not disputing that gov’t spending is part of GDP (it’s also why economists claim the GD ended in ’39 — because gov’t spending increased, which increased GDP) and I’m not proposing we change how GDP is calculated. But even you can’t possibly sit there and argue that every dollar of gov’t spending creates wealth. They’re not the same thing.
“1946″
Ok. The Keynesian account of the Great Depression is wrong, according to you, because, among other things, the Great Depression ended in 1946.
Let’s see what this means.
1) No tax or spending cuts after 1945 had any effect on the Great Depression.
2) The tax and spending cuts of 1945 ended the Great Depression instantly.
3) The Great Depression ended with a spending-cut-induced recession that lasted eight months and lowered GDP by twelve points.
4) By your account, the military spending for WWII–and possibly all government spending since the start of the Great Depression–had no effect on the Great Depression, except, perhaps to worsen it.
5) Tax and spending cuts similar to those enacted in 1945 could have ended the Great Depression at any point.
“There is no agreed definition of the term depression”– jgardner
“I don’t dispute that from an strictly economic measuring perspective (so many months of X improvement in GDP or whatever the calc is) the GD ending in ’39-’41.”–jgardner
You can say that the definition of ‘depression’ is disputed all you want, but you must provide some definition of ‘depression’ in your own account of the Great Depression, in order for your story to make sense.
You say the Great Depression ended in 1946. How do you know that? What metrics are you looking at? What changes are you observing? How are these changes different from, not only the preceeding period, but the following period?
I can use the “economic measuring perspective” that you occasionally believe in to make my argument. What definition do you use to make your argument? You must have a definition of some kind. What is it?
“I’m not proposing we change how GDP is calculated. But even you can’t possibly sit there and argue that every dollar of gov’t spending creates wealth. ”
Then you are proposing that we change how GDP is calculated.
“The tax and spending cuts of 1945 ended the Great Depression instantly. The Great Depression ended with a spending-cut-induced recession that lasted eight months and lowered GDP by twelve points.“
A. Taxes weren’t cut in ’45.
B. Production and labor needed time to adjust from wartime production to consumer production. That doesn’t happen overnight. So yes, there was a mild contraction while that adjustment occurred.
“Tax and spending cuts similar to those enacted in 1945 could have ended the Great Depression at any point.”
Not necessarily at any point because of WWII and such, but it could have been ended before the war. It could have been prevented too.
“What changes are you observing?”
Change in civilian output, the closest measurement of which, I would imagine, is GDP minus military spending. Not a perfect measurement, but close.
“Then you are proposing that we change how GDP is calculated.”
Again, no, I’m not. Higher GDP does not necessarily equate to higher economic prosperity, which is fine because GDP doesn’t measure prosperity, only production. They’re completely separate items.
Let me get this straight.
First, you said tax and spending cuts after the war ended the Great Depression.
Then, you clarified that by ‘after the war’ you meant ’1945′, because the Great Depression ended in 1946.
Now you’re saying “Taxes weren’t cut in ’45″, which means the spending cuts of 1945 alone ended the Great Depression.
What did you mean by this then? “In economics I learned that we grew out of the Depression when the Federal gov’t cut spending (dramatically) and reduced the tax rates on individuals and businesses after the war”
Even better, you’ve finally provided a measure of when the Great Depression ended: “Change in civilian output, the closest measurement of which, I would imagine, is GDP minus military spending.”
Fine. By this measure the Great Depression ended in 36.
So, when you say the Great Depression “ could have been ended before the war” I agree with you, because, by your metric, it did.
”‘GDP doesn’t measure prosperity, only production”
Yeah, but I still think you’re saying we should calculate GDP differently.
“Change in civilian output, the closest measurement of which, I would imagine, is GDP minus military spending”
Oh look. I’m right.
Also, because you are now arguing that change in ‘GDP minus military spending’ is a good measure of where depressions begin and end, it’s possible that the US has suffered multiple depressions throughout the 20th century.
Here’s your revised argument, then:
1) The Great Depression ended in 1946.
2) Contrary to your own belief, tax cuts had nothing to do with ending the Great Depression.
3) Reduction of military spending ended the Great Depression.
4) A huge reduction in military spending could have ended the Great Depression before the war or prevented the Great Depression entirely.
5) Depressions are determined by change in ‘GDP minus miltary spending’.
6) The US suffered several depressions in the 20th century.
7) The Great Depression also ended in 1936 and 1939, as well as 1946.
Yous positions are rather unorthodox, I would say.
“In basic economics classes, we’re taught that the Great Depression was ended by demand-side spending — the spending necessary to fight a World War was of the scale necessary to bring our nation out of the economic funk of the 1930s.”
If your economics teacher taught you the Keynesian narrative of the Great Depression as established fact, then you had a terrible and grossly irresponsible economics teacher. 80 years later and there is still nothing close to a consensus on the cause of the Great Depression or the role of Federal spending in ending it. I wonder if in that class you also addressed the question of why the economy grew rapidly when Federal spending was slashed after World War II when all of the Keynesians of the time were predicting a severe recession.
“The fact is that the last three years have seen ample confirmation of the theory behind Keynesian stimulus”
It’s called confirmation bias. You take all the supporting evidence and discard all of the detracting evidence. It’s a form of intellectual dishonesty, mentioned earlier in the article. Maybe that’s why you’re such an authority on the subject. In any case, this is not a “fact.” It is your interpretation of historical events, and it is extremely controversial in the economics field. It is not scientifically established because it is not falsifiable or testable under controlled conditions.
“Which is all to say that I’m not defending the Obama austerity.Which is all to say that I’m not defending the Obama austerity.”
So stimulus spending and a growing deficit are “austerity” because they are not as much as you would prefer? Stop with the nonsense already.
“80 years later and there is still nothing close to a consensus on the cause of the Great Depression or the role of Federal spending in ending it”
I bet you have a very clear idea on both.
“It is your interpretation of historical events, and it is extremely controversial in the economics field”
I bet you fall plainly on one side or the other.
“I bet you have a very clear idea on both.”
I have different theories on the matter than Tom does.
“I bet you fall plainly on one side or the other.”
Yes, but I don’t try to claim my interpretation as incontrovertible fact. I acknowledge that it is not scientifically established and that there are many economists who disagree with me.
I bet you’re trolling up another thread on RIFuture. Hey look, I bet right.
“I acknowledge that it is not scientifically established and that there are many economists who disagree with me.”
That’s not all you do here. You actually make the claim that economics cannot ever produce facts in the scientific sense of the term–a claim you’ve made elsewhere about all social sciences.
This attitude is in direct contradiction with…every economic argument you’ve ever made here.
Personally, I think you resort to this critique of economics only when you find the facts stacked completely against you, as they are here.
The Depression, the War, and the post-war economies were all centrally-planned, and the success of the latter two drives you crazy.
“I acknowledge that it is not scientifically established and that there are many economists who disagree..”
We could say that about all of the dismal science, no?
Tom, while we’re on the subject of intellectual honesty and this “growth in spending” chart you provide (which STILL doesn’t have any units – are those growth percentages?), maybe you can answer a couple of questions based upon a simple hypothetical to flesh out your narrative a bit.
In Year 2, CEO 1 buys a completely unnecessary corporate jet with company funds, which doubles the company’s spending from $50 million in Year 1 to $100 million in Year 2 – an increase of 100%. CEO 2 take over the company in Year 3, including the corporate jet that CEO 1 bought in Year 2, and then buys a completely unnecessary second corporate jet plus a penthouse and a porsche, increasing spending from $100 million in Year 2 to $160 million in Year 3. CEO 2 increased annual spending by a smaller PERCENTAGE than CEO 1, so are you saying that CEO 2 is more fiscally responsible than CEO 1 and engaging in “austerity” by only increasing spending by 60% over the previous year?
I just want Obama to stop hurting our economy, but he won’t. Obama really believes if he gives in to Republicans one more time, THEN they’ll like him.
You’d think R’s would love the Big O… he runs more drone strikes than W did, he murders US citizens without trial (I don’t think W even went that far), he kept Gitmo open. He feigns support for equal rights, he bails out his corporate cronies… He did everything W did and then some.
OK, some of this is just silly.
Saying the Depression ended in 1946 or 49 is ridiculous. Or, at best, a fringe opinion. I have read about the Depression a lot, and I have never heard it claimed that the GD did not end until 1946. I’m not saying people don’t believe this, or it’s not taught, or that a case can’t be made for it. I’m saying that, by any consensus-definition of the term. “Great Depression”, it ended in 1940 0r 42. But, I’m a history guy, not an economist. So, if there’s an economist, or a school of them somewhere who define it this way, well, they are a very small minority. There are people who believe the world is flat, too.
You cannot make a statement that the GD ended in 1946 w/o citing your source. I provided my source for my claims about the 19th century; yoiu need to do the same. However, terrific job in hijacking the thread, which, no doubt, was the intention.
Second, ‘did tax rates reduce in 1946? Irrefutably.” Sure, from about 90% to something over 81%. Yes, it’s a tax reduction, but to assert that this 9% reduction ended the GD is bizarre. We’re really moving into an alternate universe, here.
And putting millions of people to work is exactly how you end a depression. The sort of work does not matter in strict economic terms. Econ is not about morality or values or the right kind of spending, so I’ve been told. It’s about how the economy works. That people were working working and spending money by 1942 means the GD was over.
IOW, the GD ended when the government truly intervened in the economy on a massive scale. It hired all the out of work men by making them soldiers. It handed out enormous government contracts to manufacturers to produce planes, tanks, guns, etc. That is, it created a huge demand. Due to the shortage of male labor, women were hired to run the factories to produce what the army needed.
And yes, gov spending dropped after the war. Because, well, the war was over. So of course spending dropped. It always drops after a war, especially one on the scale of WWII. Adam Smith noted this happening in Great Britain in the 18th Century.
However, spending did not drop to zero. Rather, the gov kept intervening in the economy by way of the GI bill. Oh, this passed in 1944, so I guess it’s not part of the post-war ending-of-the-GD, is it? The GI bill allowed tens of thousands of working-class men to go to college.The GI bill also allowed vets good rates for home loans, spurring the creation of Levittowns, and scores of imitators across the country. This created a demand for cars, and cars bring in a huge swath of other industries like glass and rubber and steel. Then, to keep things moving, Ike embarked on the Interstate Highway program, creating the need for engineers, construction workers, etc.
So the children of lower/working class parents who fought in the war were able to buy houses and cars and appliances on a scale such as their parents could never have imagined. Kids who grew up in urban tenements were home owners. And car owners.
As for the “Obama Austerity,” phrase, this is exactly the sort of nonsense that people without an argument pull. It’s a sloppy term. It’s not really accurate. No, we haven’t tried austerity at the federal level, but it’s sure as hell been happening in the states. The number of gov workers has plummeted since 2008. In fact, cuts at the state level have been one of the biggest drags on the economy over the past few years. Put the several hundred thousand state and local employees back in the workforce added to the jobs created by the private sector and you have the makings of a decent recovery.
So, no, this is not ‘Obama Austerity.’ But it’s austerity at the state level. Quibbling over the term is a distraction. Bad choice of words, Tom. But you’re still 99% correct in your assertions. That’s about 98% more correct than your detractors.
And, btw: it’s not Obama that’s hurting the economy. It’s the Rs, who refuse to give Obama anything that he can use as a political victory. The same Rs who questioned the patriotism of John Kerry, who served in the military, are perfectly willing to let people starve rather than countenance another term of Obama, or any Democrat, for that matter. These people claim to respect the constitution, but pervert it by requiring a 60% majority to pass bills. That’s simply wrong. The constitution stipulates that the both houses of gov work on simple majority, with a few exceptions. Ordinary legislation is not one of those exceptions. So the Rs have willingly and cynically perverted the constitution to serve there own bald political ends.
“OK, some of this is just silly”
Some?
“by any consensus-definition of the term. “Great Depression”, it ended in 1940 0r 42.”
That’s because the “consensus-definition” includes the massive gov’t spending that was WWII. You can’t possibly argue that life during WWII for the millions of Americans in the armed forces was better than before it, or that the living standards of those on the US mainland were better given that a host of goods, like food, were rationed. So even though the GD may have been over in terms of GDP measurement, it falls short of telling the whole story.
“There are people who believe the world is flat, too.”
You’re right… they’re probably the same people who think war or natural disasters bring about economic prosperity.
“You cannot make a statement that the GD ended in 1946 w/o citing your source.”
www.fff.org/freedom/0395d.asp
www.thefreemanonline.org/columns/our-economic-past-the-great-escape-from-the-great-depression/
wiki.mises.org/wiki/Great_Depression
“It always drops after a war, especially one on the scale of WWII”
I understand, but the Keynesian economic consensus at the time was that if the gov’t didn’t continue the massive spending that it would be met with an equally massive economic contraction potentially, if not definitely, leading to another Great Depression. The Keynesian economists were wrong.
“Yes, it’s a tax reduction, but to assert that this 9% reduction ended the GD is bizarre”
I never asserted singularly that a cut in the tax rates ended the GD. I’d argue the massive reduction in gov’t spending and the removal of many of the command-rules over the economy were the biggest factors, but reducing the tax rates (the first reduction since 1930) send the message that some sanity would be returning to gov’t policy.
“So the Rs have willingly and cynically perverted the constitution to serve there own bald political ends.”
When the D’s inevitably pull the same nonsense, as both sides play exactly the same games, can we expect you to display the same outrage? And speaking of fidelity to the Constitution, when is the last time the Senate passed a budget? Well over 3 years ago, correct?
“even though the GD may have been over in terms of GDP measurement, it falls short of telling the whole story”
Wait a minute.. now it’s a quality of life issue? Just a few posts ago, you presented your own GDP measurement to mark the end of the Great Depression–a measure that would have fixed the end of the Great Depression before the war.
Now, it’s like some kind of opinion poll?
The sources you provide are a blog, a blog, and an Austrian School wiki that seems to say the Great Depression ended in 1941:
“The recovery from the Great Depression in the United States is usually associated with the advent of World War II, a period when real GDP appeared to increase phenomenally and the rate of unemployment fell almost to zero. A more detailed view produces a different picture, with large government “make-work” programs at first and military employment during the war – but a very slow actual recovery. When using hours worked as measure of employment, only in 1941 total work hours exceed the 1929 value (by 3 percent), with the population vigorously engaged in mobilization for war.”
”the Keynesian economic consensus at the time was that if the gov’t didn’t continue the massive spending that it would be met with an equally massive economic contraction potentially, if not definitely”
According to you, they were right. If the Great Depression continued into 1946, as you say, then they were right.
Further, the period of 45-49 began and ended with recessions, and it wasn’t until 1950, when military spending ramped up again, that the economy reached war-level GDP growth.
Which means that, if we use your measure of where and when Great Depressions start–’GDP minus military spending–then, either a second Great Depression began in 1949 or the Great Depression didn’t end until…maybe the seventies.
So, by your own account, those Keynesians who predicted very bad times after the war were right.
“I never asserted singularly that a cut in the tax rates ended the GD.”
No you said tax cuts together with spending cuts, which would place the end of the Great Depression at 1947.
“by any consensus-definition of the term. “Great Depression”, it ended in 1940 0r 42.”
That’s because the “consensus-definition” includes the massive gov’t spending that was WWII. You can’t possibly argue that life during WWII for the millions of Americans in the armed forces was better than before it, or that the living standards of those on the US mainland were better given that a host of goods, like food, were rationed. So even though the GD may have been over in terms of GDP measurement, it falls short of telling the whole story.
“There are people who believe the world is flat, too.”
You’re right… they’re probably the same people who think war or natural disasters bring about economic prosperity.
“You cannot make a statement that the GD ended in 1946 w/o citing your source.”
www.fff.org/freedom/0395d.asp
www.thefreemanonline.org/columns/our-economic-past-the-great-escape-from-the-great-depression/
“It always drops after a war, especially one on the scale of WWII”
I understand, but the Keynesian economic consensus at the time was that if the gov’t didn’t continue the massive spending that it would be met with an equally massive economic contraction potentially, if not definitely, leading to another Great Depression. The Keynesian economists were wrong.
“Yes, it’s a tax reduction, but to assert that this 9% reduction ended the GD is bizarre”
I never asserted singularly that a cut in the tax rates ended the GD. I’d argue the massive reduction in gov’t spending and the removal of many of the command-rules over the economy were the biggest factors, but reducing the tax rates (the first reduction since 1930) send the message that some sanity would be returning to gov’t policy.
“So the Rs have willingly and cynically perverted the constitution to serve there own bald political ends.”
When the D’s inevitably pull the same nonsense, as both sides play exactly the same games, can we expect you to display the same outrage? And speaking of fidelity to the Constitution, when is the last time the Senate passed a budget? Well over 3 years ago, correct?
( this is a duplicate that avoids the link limitations in comments )