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David Sirota weighs recent Right Wing revisionism concerning FDR’s New Deal:

Afterward, suffering pangs of self-doubt, I wondered whether I and most of the country are the crazy ones. Sure, the vast majority of Americans think the New Deal worked well. But are conservatives right? Did the New Deal’s “massive government intervention prolong the Great Depression”?

Ummm … no.

Upon deeper examination, I discovered that the right bases its New Deal revisionism on the short-lived recession in a year straddling 1937 and 1938. But that was four years into Roosevelt’s term—four years marked by spectacular economic growth. Additionally, the fleeting decline happened not because of the New Deal’s spending programs, but because Roosevelt momentarily listened to conservatives and backed off them. As Nobel-winning economist Paul Krugman notes, in 1937-38, FDR “was persuaded to balance the budget” and “cut spending and the economy went back down again.”

To be sure, you can credibly argue that the New Deal had its share of problems. But overall, the numbers prove it helped—rather than hurt—the macroeconomy. “Excepting 1937-1938, unemployment fell each year of Roosevelt’s first two terms [while] the U.S. economy grew at average annual growth rates of 9 percent to 10 percent,” writes University of California historian Eric Rauchway.

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2 Comments

  1. I am sorry, I was unaware of “spectacular growth” in the Great Depression. I just assumed that the Great Depression was called the Great Depression because there was no “spectacular growth”. I guess the period should be rename the Great Spectacular Growth Period.

    Welcome back by the way.

  2. http://online.wsj.com/article/SB123120525879656021.html

    The headline of this article sounds like it came directly from The Onion. People know what to naturally do during a recession– cut back, save, work hard, try to reestablish yourself in a changing economy. What does government do- spend more, large deficits, make work jobs, try to keep the statis quo.

    Simple logic tells us that something is wrong with the government view.


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