Didn't Roosevelt prolong the great depression with his policies?

[Former Governor Tim]

He didn't allow the FREE market to fix itself.

[Think 1st]

Nope, history proves that supposition to be false.

Except for recent phony conservative revisionist history of course.

[Lois Griffin]

No, he did the right thing by taking action to resolve the crisis.

[Gazeline]

He ended it smart one.

[Joe Finkle]

Yes, in 1937 when he pulled back on the New Deal. The economy was recovering, but still weak and he bowed to political pressure and went with an austerity program to fight the rising debt. The economy sank back into depression.

Had he followed the advice of his adviser John Maynard Keynes who told him that the New Deal as he was doing it wasn't enough, we would probably have been into a stable enough economy in 1937 that we could pull back. But whether it was his own misgivings or a Congress that was willing to follow him only so far, he didn't do that. He did the New Deal, but he didn't do it completely enough.

After the disaster of austerity in 1937 (repeated by Japan in their lost decade in 2000 and England in their disaster in the 1980's and in 2010 and countless other times almost universally to great failure) FDR turned around. He began the ramp up to WWII. He couldn't sell that kind of spending just as an economic tool, but when it looked like war was inevitable, he got enormous spending through. By Pearl Harbor, we were already basically out of the depression because the war effort put people to work building ships and planes and tanks and developing technology and doing all kinds of other things. Then those people spent their money, spreading it throughout the whole economy.

We spent 125% of GDP. That is extreme, but this is the Great Depression we're talking about, it was an extreme event that required an extreme response. It worked. After the war, our economy was robust enough to pay down that debt, returning to a point where it was manageable and FDR's new economic system that he had established led to stability and prosperity with absolutely no purely economic recessions bigger than what the Fed could handle with relatively small adjustments until Reagan began to dismantle that system. We had recessions caused by international strife, like the oil embargo, but we didn't start hitting an uncontrolled boom and bust until the Reagan era.

[ChasFact]

It is the ignorance about that time period that has us making the same mistakes over and over.

The big confusion in America is about taxes, when you raise them at first you get more money to government, but then you slow the economy and get less revenue. When you lower them, at first you get less, but then money flows and keeps flowing as the economy grows.

Liberals like to look at short time periods when they think, and conservatives think like business people and want long term ideas.

The reason this happens is capital is needed to build any enterprise, to buy equipment and to train labor, to grow. When taxes are high on high earnings, reinvestment goes down, desire is sapped, and less creation happens.

Fact is, those who create jobs, already have money and make money, the only reason to grow that base and risk working with others is the chance to make great money. High taxes gives that money to others, so the economy suffers for all who need jobs.

Roosevelt raised taxes to around 94%, but gave huge amounts back in the form of programs.

The economy never recovered, only war gave the feeling things were better, thousands of men killed lowered the unemployment rate. People agreed to sacrifice for the war effort.

So dems still really believe that punishing rich people is possible, while raising poor people? The rich raise their prices to pay the tax they lay people off, and they take their money other places to grow it. Free markets must be free and government is the problem.

[JT]

Yes! He sure did. He raised taxes several times and then some. And we wonder why we were in it as long as we were.

[tigeress]

No, a few hours after he was elected Roosevelt went to work and signed an act intended to avert a banking disaster by closing all the banks. He then reopened the banks and regulated them which means they were under strict government supervision. Banking regulations continued until George Bush deregulated them and we all know what happened as a result.
Next he developed a program called the New Deal which helped end the Great Depression. The key law of the New Deal was the Social Security Act of 1935 which helped the disabled and the retired. Yet, it was actually designed to help the jobless. The government provided $16 billion dollars to help the jobless. Congress passed a law that recognized the right of workers to form labor unions.

America prospered during WW ll because the war created jobs and American businesses sprung up over night . Those who had jobs had money to spend buying homes, furniture and cars. America prospered because we were number one in manufacturing goods. Now everything is cheap crap made in China. Who ever thought that sending the jobs to China and India was a good idea should given a one way trip to the moon.