A little intro: So I started doing some more research about “Big Government” and FDR’s New Deal. I am really concerned about the consequences of expanding the government, and from the information I’ve found, it doesn’t look like making the government bigger is such a great idea. If you are interested read about the Fjallraven sale, if not, that’s fine too. 🙂
FDR’s own Treasury Secretary (A Democrat) wrote after the Great Depression that frantic government spending, increased wages, and strengthening worker unions not only did not bring the country out of the Great Depression (by the way those three things above occurred years after the 1929 Stock Market Crash) but caused the Great Depression from what would of been a two or three year recession, again these are the words and thoughts of Democrats from the late 40s and early 50s (who by the way made these mistakes….they admitted they screwed up to warn future generations!!!) See this article posted by the Washington Post (a paper known for its favoritism towards the Democratic Party)
You’ll notice in this article what Hoover did wrong (A Republican, but he made very bad mistakes as did both parties at the time, hence their warnings years later to prevent this from reoccurring). Hoover raised the top income tax rate from 25% TO 63%, now if you’re a private business owner, (which includes big corporations as well as an example of my father’s franchise of three small pizza shops,) if you have to pay 63% of your profits/earning to income tax something has to give…and that something is…….ding ding ding I CAN’T AFFORD ALL MY EMPLOYEES and if I can’t afford all my employees they’ll get laid off RAISING THE UNEMPLOYMENT RATE TO 20%+ (it’s at 7.5% roughly today), and if I have to lay off workers raising the unemployment THERE’S LESS PEOPLE THAT CAN AFFORD NORMAL GOODS like eating at restaurants, tourism stuff (things that employ more people) CAUSING MORE LAYOFFS/UNEMPLOYMENT!!!!!
If companies have to lay off more people they can’t compete or sell good products for those who still have money and in turn HAVE TO CLOSE THEIR BUSINESS…causing what….ding ding ding MORE UNEMPLOYMENT and no one knowing where to buy Fjallraven. And what did both the Republicans and Democrats who made this mistake do after the fact….they did something our current politicians don’t (or at least until they have to) ADMIT THEY MADE A MISTAKE. Why did they admit their mistakes, and document them…BECAUSE THEY DIDN’T WANT FUTURE AMERICANS TO MAKE SIMILAR MISTAKES.
What I wrote above is not a hard concept to understand, but everyone feels that being harder on “big business” who are only” greedy” is the way to improve the economy. (THIS DOES NOT APPLY TO COMPANIES WHO HAVE ASKED FOR BAIL OUT MONEY) The Government can’t and won’t employ all Americans as the country would fail and fall economically. How can people say that FDR’s big government brought us out of the Great Depression when his OWN cabinet secretaries said it caused the Great Depression from what would of been a medium to severe recession…NOT A DEPRESSION!!!I found a chart which you can also find through the Bureau of Labor and Statistics:
You can see the trend of how the unemployment rate increased when the New Deal was passed, which our GDP suffered tremendously. Unemployment rate had a dramatic decrease and GDP took a huge increase due to WW2 not from FDR’s New Deal. The New Deal, was essentially the stimulus package we are facing today, except with different agenda’s.
No one can deny this message from Mr. Henry Morganthau in a statement before a joint session of congress in May 1939, this is his quote (HE WORKED FOR FDR AS HIS TREASURY SECRETARY…THE GUY WHO ORCHESTRATED THEIR “STIMULUS BILL OF THE TIME CALLED THE “NEW DEAL” (Most school’s teach of this, or use to).
Notice the last sentence that is very important, he mentioned we have an enormous debt to boot, meaning even after the big spending “Big Government Programs” that didn’t work they still had to pay for those programs, which meant they had to raise taxes higher taking more money than ever from the lower-middle class, and the upper-middle class and upper class to pay for this stuff meaning less money out of the hands of people that spend, and spending on private companies drives the need to produce more goods/services, which drives the need to hire more people to keep the business running better, which puts more tax money back into the government (even after lower taxes as JFK (oh yes a Democrat who did understand this, and as Ronald Regan did). You know what happened when Regan reduced taxes after the late 70s/early 80s recession (which is still far worse than where we are right now in unemployment rates and tax rates).
The government reported more tax revenue…..why…..because more money was in the hands of the consumer…..what do we as consumers do with more money in our hands……we buy TVs, go to Myrtle Beach or Hawaii, we buy 10 presents at Christmas instead of 1 Kanken backpack, we go to restaurants or Target to buy things……what does this do….it means more money is being spent which the greedy companies in turn give back to the government in the form of sales tax and those businesses have to hire more people to keep up with the demand.
So to answer the question of; if FDR didn’t get us out of the Depression what did? Easy answer called World War II…how? Easy, what did American do in the late-30s and early 40s before we entered WWII…we opened new plants, expanded plants to export resources, materials, foods/produce, weaponry, etc. to our allies: England, France (before they fell), China (at this time they were our quasi-Ally (enemy of our enemy (Japan)). All this exporting of goods did one thing, increased the United States Gross Domestic Product, simply known as the overall value of goods/services produced in the country for a given year.
Meaning we made a s***load of money because we had suppliers outside of the US that needed US products, so the “greedy” big businesses who only wanted to make money had to start hiring the “perfect people” off the streets to work in their factories so they could meet the foreign demand. In turn the jobless rate plummeted and more money finally got into the hands of normal families who in turn spent more and in turn getting more sales tax, property tax back to the government from their spending.
(As you can tell I’m being a little stupid on calling them perfect people and greedy business), but people need to understand that it’s ok for companies to make money….it drives the sprit in Americans to want to make something of themselves….any one of us can leave our parents’ home with no money and make the right choices and be Bill Gates….that’s the beauty of the system. The big difference today is that back in the 30’s, 40’s, the people in office weren’t doing these things with malicious intents, they truly thought they were doing the right thing, and admitted when they were wrong. Today’s officials are knowingly, doing this and know that this stimulus package is going to be a devastation to this country.