The 1929 and 30's depression was a result of state-socialism, not market liberalism

[Arch]

I'm breaking out a discussion from the Republican candidate thread to dicsuss a rather important topic, h

Look up 1929 in the history books and tell me how laissez-faire economics worked wonders then...
While the rest of the world uses Keynesian economics, I see nobody using Hayek's wonderful ideas. Wait, maybe Somalia...

We'd be in depression if we let the banks fail.

My economic minister, Anders borg of Sweden, has been elected as the best economic minister and the most successfull in fighting the current crisis, in difference to his American, keynesian colleagues.
"Borg grabs top spot in Financial Times' ranking"

]No topic is more mired in agendas than that one.[/B]

A link will suffice.

Link are inferior to books, and only for you, I went back and opened one of my favorites: "A perfect Storm" by the famous, swedish liberal Johan Norberg. I'm actually not a liberal myself but a Nordic socialconservative, however one could call me america-liberal as I beleive that the western world needs atleast one liberal land for diversity and possibilities to choose. Hence I find it natural that the USA who has that very role inscribed in its founding constitution and also has prospered with that character.

Before I begin I would also like to add a funfact: ABC, CBS AND NCB made comparisions to the depression over 40 times in the 4 following months of the 08crisis. (Gainor, Seymour & Ebel 2008).

To quote Norberg Exactly:" The picture that most people has is that the American president Herbert Hoover was such a dogmatic follower of laissez-faire that he after the marketcrash 29 stayed passive and let the economy die as he thought the free market would solve all problems. Even more widespread is the thought that his follower Roosevelt was the one to solve the crisis with state-interventionism."

Sadly I cannot quote the whole book here, so I'll just point out the arguments, facts and sources to prove my desirable austrian, americaliberal megapoint.

1. The USA already had an economic crisis in 1921, which few know of, becuase this crisis was met by the Republican and economic austrian Warren Harding who did not interviene with other thing that CUTS. He halved statespending and lowered taxes, quite the opposite to todays ideal wouldn't you say? The effect was clear, 6% BNP growth next year and this crisis was soon forgotten. The world would never appretiate austrian economics enough, neither.Not-So-Great Depression, Jim Powell 2007

2. At the time of the above discussed small-crisis of 1921, Herbert Hoover, the president during the following depression, was active and critical to Hardings non-interventionism. He beleived humanities faults could be fixed by social engineering. Benny Carlson, University of Lund 2007.

3. When Hoover met the later market crash as the role of president, he quickly began the greatest protectionist-interventionist-total-madness in the history of the USA. He and the republican congress quickly pulled trough the famous Smooth Hawley tariff that gave USA the next to greatest toll in its history. The world responded back after protesting with their own tolls to defend their markets, and Voila! Your "laissez-faire" economics had suddenly created a world of keynesian bullocks and tolls. Fact is that the collapse itself that was the start of the crisis began after the news spread that the coalition to defend from such a stupid political move and collapsed. (Jude Wanniski ,"The crash of '29 - a new view" posted in The Wall Street Journal 28 october 1977).

4. Hoover then expanded statis expentiures, subsidising the agriculture he killed with his protectionism. He also created masses of state work-programs. He therefore increased taxes by shockings amounts when the economics was already crashing down. The only thing Hoover didn't interviene for was the banks, and I think we can surely agree these jews learned their lesson. Moore than 10 000 banks died. Why? They were too concentrated, during this time the banks was by law restricted to not work outside their state, hence national megabanks who could stand against such a depression was by STATELAW impossible. That is laissez faire? In fact, Canada was hit even harder by the collapse as this small country was mercilessly raped by the new tolls of USA, but Canadas banks wasn't restricted by state and guess what? The small nation of Canada didn't lose a single bank during the whole depression. They also didnt have a federal reserve bank till 1935, lucky them. You see during this time of laissez-faire, the statecontrolled fed actually increased interested rates and federal reserves. A monetary history of the united states 1867-1960
By Milton Friedman, Anna Jacobson Schwartz

5. Most effective to destroy economic recovery was Hoovers move to uphold wages for the citizens, which created a situation for the companies were wages didn't drop even though they couldn't sell their products not only in the tollprotected outside world but neither in the USA. As the banks were dying they couldn't find capital to starve out the depression either. Rothbard 1983 "America’s Great Depression".

6. Ayn Rayn actually voted for Roosevelt the democrat to stop Hoovers madness. She was however fooled, becuase Hoovers follower Roosevelt actually expanded state expenses 3 times. So much for laissez-faire. (A History of the American People, by Paul Johnson)

7. To summarize: Humanity and its civilization is imperfect. As long as this remains, our system of production and wealth will sometimes meet problems (rumors, greedines, wars, catastrophs, limited resourcess etc) and have a setback. If the world was to meet a problem without any economic consequence, as in the Socialist utopia, we would indeed be living in nothing but a fairytale.


The great depression was a display of how to not meet a crisis; with interventionism and state-expenditure. All in all, the socialistic state-interventionism following the crisis of 29 prolonged the crisis by what could be a total of 7 years followed by WW2 which ended enourmous government marketprograms. Somehow, people actually beleive that by increasing the human and political control of the market, the human factor that actually creates these problems, will be repelled. It could be compared to modern day airplaine companies trying to reduce crashes by giving more responsibity to the pilots, who stand for more than 90% of all crashes.

The question isn't wether crisis and economics will emerge, they always will as long as we are humans in an imperfect world, but rather how we meet them. A crisis is with the right conditions and the right policies as much an opportunity as a catastroph for the players of the market.

Thoughts?

[Chukada1]

I like the fact that you mentioned Canada. It makes me happy.

Anyways. The Great Depression was caused by state actions (socialism it was not).
There is nothing socialist about tariffs or legislation that controls where banks operate, that's called something else.

If you want to say socialism is really bad, you should look at the horrible case of Germany and Sweden. Pathetic economies.

Wikipedia:

Thus, the personal political and policy viewpoints of scholars greatly color their analysis of historic events occurring eight decades ago.[citation needed] An even larger question is whether the Great Depression was primarily a failure on the part of free markets or a failure of government efforts to regulate interest rates, curtail widespread bank failures, and control the money supply. Those who believe in a larger economic role for the state believe that it was primarily a failure of free markets, while those who believe in a smaller role for the state believe that it was primarily a failure of government that compounded the problem.

Wikipedia:

Secondly, there are the monetarists, who believe that the Great Depression started as an ordinary recession, but that significant policy mistakes by monetary authorities (especially the Federal Reserve), caused a shrinking of the money supply which greatly exacerbated the economic situation, causing a recession to descend into the Great Depression. Related to this explanation are those who point to debt deflation causing those who borrow to owe ever more in real terms.

Many different theories exist, but government touching is not called socialism. Its state capitalism is it not? Anyways. Pure Laissez-Faire sucks a lot. Pure socialist doctrine also sucks. The best economy is one that learns from the best of every doctrine.

[King Gambrinus]

First of all, I should thank you for providing such a detailed analysis for my post.

Link are inferior to books, and only for you, I went back and opened one of my favorites: "A perfect Storm" by the famous, swedish liberal Johan Norberg. I'm actually not a liberal myself but a Nordic socialconservative, however one could call me america-liberal as I beleive that the western world needs atleast one liberal land for diversity and possibilities to choose. Hence I find it natural that the USA who has that very role inscribed in its founding constitution and also has prospered with that character.

I will try to read read this book. The Road to Serfdom is a great book too.

To quote Norberg Exactly:" The picture that most people has is that the American president Herbert Hoover was such a dogmatic follower of laissez-faire that he after the marketcrash 29 stayed passive and let the economy die as he thought the free market would solve all problems. Even more widespread is the thought that his follower Roosevelt was the one to solve the crisis with state-interventionism."

1. The USA already had an economic crisis in 1921, which few know of, becuase this crisis was met by the Republican and economic austrian Warren Harding who did not interviene with other thing that CUTS. He halved statespending and lowered taxes, quite the opposite to todays ideal wouldn't you say? The effect was clear, 6% BNP growth next year and this crisis was soon forgotten. The world would never appretiate austrian economics enough, neither.

This seemed to be a small crisis. To use an analogy, in the 70's we had an economic crisis, but nothing on this scale...

Austrian economics have only really emerged and been recognized very recently, as an increasingly libertarian America searched the history books for a good theory to counter the "Big Government" idea of curing a recession. Meanwhile, the Return of the Master ensured that we didn't go into another Depression.

2. At the time of the above discussed small-crisis of 1921, Herbert Hoover, the president during the following depression, was active and critical to Hardings non-interventionism. He beleived humanities faults could be fixed by social engineering.

I never really said Herbert Hoover was not responsible for aggravating the Great Depression. On the contrary, had there been a good, strong, but fair government, then perhaps the Great Depression could be avoided. He was weak.

But blaming him and his "social engineering" is far fetched. The Great Depression was nobody's fault, really, it was just market forces in a free market system that caused it. As the title of your book suggests, it was a perfect storm in a free market.

3. When Hoover met the later market crash as the role of president, he quickly began the greatest protectionist-interventionist-total-madness in the history of the USA. He and the republican congress quickly pulled trough the famous Smooth Hawley tariff that gave USA the next to greatest toll in its history. The world responded back after protesting with their own tolls to defend their markets, and Voila! Your "laissez-faire" economics had suddenly created a world of keynesian bullocks and tolls. Fact is that the collapse itself that was the start of the crisis began after the news spread that the coalition to defend from such a stupid political move and collapsed. (Jude Wanniski ,"The crash of '29 - a new view" posted in The Wall Street Journal 28 october 1977).

Much like everyone else at the time, he panicked and took a few wrong steps, but had he waited for Keynes...who knows.

4. Hoover then expanded statis expentiures, subsidising the agriculture he killed with his protectionism. He also created masses of state work-programs. He therefore increased taxes by shockings amounts when the economics was already crashing down. The only thing Hoover didn't interviene for was the banks, and I think we can surely agree these jews learned their lesson. Moore than 10 000 banks died. Why? They were too concentrated, during this time the banks was by law restricted to not work outside their state, hence national megabanks who could stand against such a depression was by STATELAW impossible. That is laissez faire? In fact, Canada was hit even harder by the collapse as this small country was mercilessly raped by the new tolls of USA, but Canadas banks wasn't restricted by state and guess what? The small nation of Canada didn't lose a single bank during the whole depression. They also didnt have a federal reserve bank till 1935, lucky them. You see during this time of laissez-faire, the statecontrolled fed actually increased interested rates and federal reserves.

Very interesting. I'm not a fan of capitalist protectionism, and this is a good point.

5. Most effective to destroy economic recovery was Hoovers move to uphold wages for the citizens, which created a situation for the companies were wages didn't drop even though they couldn't sell their products not only in the tollprotected outside world but neither in the USA. As the banks were dying they couldn't find capital to starve out the depression either.

We agree on this, workers should have cut the bollocks and lowered the wages for a year or so, and the state should have lowered taxes in return. I'm all for worker protection, but in times of crisis, we all have to make sacrifices.

6. Ayn Rayn actually voted for Roosevelt the democrat to stop Hoovers madness. She was however fooled, becuase Hoovers follower Roosevelt actually expanded state expenses 3 times. So much for laissez-faire.

I think the war also pushed Roosevelt to tighten the governments grip on the economy. Are you denying that Roosevelt's plans helped cure the Depression?

7. To summarize: Humanity and its civilization is imperfect. As long as this remains, our system of production and wealth will sometimes meet problems (rumors, greedines, wars, catastrophs, limited resourcess etc) and have a setback. If the world was to meet a problem without any economic consequence, as in the Socialist utopia, we would indeed be living in nothing but a fairytale.

But Keynes says this too. For him, its natural human instinct for there to be a bull-bear market. Only he seeks to fix things when things go wrong. Keynes is hardly a socialist, although I do agree with Hayek that Keynesian economics can lead to socialism and a state that is too big (i.e Nazi Germany, as Hayek used as an example).

The great depression was a display of how to not meet a crisis; with interventionism and state-expenditure. All in all, the socialistic state-interventionism following the crisis of 29 prolonged the crisis by what could be a total of 7 years followed by WW2 which ended enourmous government marketprograms. Somehow, people actually beleive that by increasing the human and political control of the market, the human factor that actually creates these problems, will be repelled. It could be compared to modern day airplaine companies trying to reduce crashes by giving more responsibity to the pilots, who stand for more than 90% of all crashes.

For a start this is assuming big government is a very bad thing. Sometimes, you need big government. Not the type of corrupt government we have in America now mind you...

The question isn't wether crisis and economics will emerge, they always will as long as we are humans in an imperfect world, but rather how we meet them. A crisis is with the right conditions and the right policies as much an opportunity as a catastroph for the players of the market.

Again, this sounds exactly like Keynes - he thinks the crisis is inevitable, that a boom and bust cycle is just what happens when you have a free market capitalist economy. While Hayek and the laissez-faire gang say to just let markets equilibrate, Keynes is the one finding the solutions!

[Arch]

First of all, I should thank you for providing such a detailed analysis for my post. I will try to read read this book. The Road to Serfdom is a great book too.

Thank you aswell! The english name of the book is "Financial Fiasco: How America's Infatuation with Home Ownership and Easy Money Created the Economic Crisis"

This seemed to be a small crisis. To use an analogy, in the 70's we had an economic crisis, but nothing on this scale...

In the wikipedia links mentioned above the 20-21 crisis is actually called the 20-21 depression. I don't know the exact details to make a good comparision though, but I wouldn't say that.

Austrian economics have only really emerged and been recognized very recently, as an increasingly libertarian America searched the history books for a good theory to counter the "Big Government" idea of curing a recession. Meanwhile, the Return of the Master ensured that we didn't go into another Depression.

Didn't go into another depression? If current bailouts have done anything, it has delayed the system collapse and bailoued out the princes of it, the bankers, on the cost of the American individual.

http://www.usdebtclock.org/
This is a result of "the Return of the Master".

I never really said Herbert Hoover was not responsible for aggravating the Great Depression. On the contrary, had there been a good, strong, but fair government, then perhaps the Great Depression could be avoided. He was weak.

And what would this good and fair, like the holy unhuman prince of an utopian fairytale, do instead?

But blaming him and his "social engineering" is far fetched. The Great Depression was nobody's fault, really, it was just market forces in a free market system that caused it. As the title of your book suggests, it was a perfect storm in a free market.

I didn't go into detail the causes, I discuss the actions against it. Much thanks to Hoovers keynesian politics, a crisis became the greatest depression in the history of the modern western world.

I think the war also pushed Roosevelt to tighten the governments grip on the economy. Are you denying that Roosevelt's plans helped cure the Depression?

Yes, as I said in the post with my sources, Roosevelt continued what Hoover did and it went to hell all the way until after WW2 when the plan was ended and America had a golden age. If you want to prove that Roosevelts continued interventionism had good effect, please do.

But Keynes says this too. For him, its natural human instinct for there to be a bull-bear market. Only he seeks to fix things when things go wrong. Keynes is hardly a socialist, although I do agree with Hayek that Keynesian economics can lead to socialism and a state that is too big (i.e Nazi Germany, as Hayek used as an example).

Again, this sounds exactly like Keynes - he thinks the crisis is inevitable, that a boom and bust cycle is just what happens when you have a free market capitalist economy. While Hayek and the laissez-faire gang say to just let markets equilibrate, Keynes is the one finding the solutions!

What kind of "fixing" and "solutions" are we talking about here?

For a start this is assuming big government is a very bad thing. Sometimes, you need big government. Not the type of corrupt government we have in America now mind you...

When, outside war, do you need a big government?

[King Gambrinus]

Didn't go into another depression? If current bailouts have done anything, it has delayed the system collapse and bailoued out the princes of it, the bankers, on the cost of the American individual.

The system hasn't collapsed yet, and hasn't looked like collapsing recently. Growth and unemployment seems to be the real problem now...We could have ten dead years of slow growth...

http://www.usdebtclock.org/
This is a result of "the Return of the Master".

Except the Master explicitly says that when in a boom, you must pay off the debt and not invest in absurdities (like the housing market). Reagan failed to do that.

And what would this good and fair, like the holy unhuman prince of an utopian fairytale, do instead?

I didn't go into detail the causes, I discuss the actions against it. Much thanks to Hoovers keynesian politics, a crisis became the greatest depression in the history of the modern western world.

Those were not Keynesian. They were protectionist, and simply didn't work. He taxed way too much, something Keynes said was pointless, and didn't encourage people to spend in the economy, instead forcing them to. Keynes gives people the freedom to spend money on good and services, which actually rids the economy of the useless bubble business' that Austrian economists like to think survive in these kind of situations.

Yes, as I said in the post with my sources, Roosevelt continued what Hoover did and it went to hell all the way until after WW2 when the plan was ended and America had a golden age. If you want to prove that Roosevelts continued interventionism had good effect, please do.

No he didn't. The whole point is he changed Hoover's plan to a proper Keynsian model. He lowered taxes pre-War time, and gave people confidence to spend their savings.

What kind of "fixing" and "solutions" are we talking about here?

Aggregate demand going up, and giving the public money to spend instead of save by giving them employment and not welfare.

When, outside war, do you need a big government?

When bankers and the general public aren't mature enough to see the long term instead of investing in a series of bubbles and don't pay off the debt on their own credit cards. America is not ready yet for Hayek's policies.

[Dr. Croccer]

I think you need to read up what ''State Socialism'' means, because it didn't exist in the US or Western Europe.

1. The USA already had an economic crisis in 1921, which few know of, becuase this crisis was met by the Republican and economic austrian Warren Harding who did not interviene with other thing that CUTS. He halved statespending and lowered taxes, quite the opposite to todays ideal wouldn't you say? The effect was clear, 6% BNP growth next year and this crisis was soon forgotten. The world would never appretiate austrian economics enough, neither

Erm, no. What really helped was this:

http://en.wikipedia.org/wiki/Depress...nment_response

President Warren Harding convened a President's Conference on Unemployment at the instigation of then Commerce Secretary Herbert Hoover as a result of rising unemployment during the recession. About 300 eminent members of industry, banking and labor were called together in September 1921 to discuss the problem of unemployment. Hoover organized the economic conference and a committee on unemployment. The committee established a branch in every state having substantial unemployment, along with sub-branches in local communities and mayors' emergency committees in 31 cities. The committee contributed relief to the unemployed, and also organized collaboration between the local and federal governments. President Warren G. Harding signed the Emergency Tariff of 1921 and the Fordney–McCumber Tariff which was supported by the Republican Party and conservatives and generally opposed by the Democratic Party and liberal progressives.

Full original report here:

http://www.archive.org/stream/cu3192...ge/n1/mode/2up

[hellheaven1987]

I think you need to read up what ''State Socialism'' means, because it didn't exist in the US or Western Europe.

He probably means National Socialism.

[Arch]

I think you need to read up what ''State Socialism'' means, because it didn't exist in the US or Western Europe.

Erm, no. What really helped was this:

http://en.wikipedia.org/wiki/Depress...nment_response

Do you have anything else as a reference than a wikipedia link describing the creation of multiple committees across the nation without any information about what they actually did?

And to add:

...acknowledged that the statistics of the Bureau of Research of the American Farm Bureau that showed farmers had lost more than $300 million annually as a result of the tariff.

Luckily, The President was smart enough to realize that state cuts and lowered taxes was the way to go to fight the crisis, and the effect of these was enough to make up for stupid tariffs.

[Dr. Croccer]

Do you have anything else as a reference than a wikipedia link describing the creation of multiple committees across the nation without any information about what they actually did?

Full original report here:

http://www.archive.org/stream/cu31924032446498#page/n1/mode/2up

Come on, it wasn't that hard to spot.

Luckily, The President was smart enough to realize that state cuts and lowered taxes was the way to go to fight the crisis, and the effect of these was enough to make up for stupid tariffs.

You mean, those stupid tariffs that he himself put into place?

[removeduser_4536284751384]

Finally listening to us it seems.

[Thorn777]

Ayn Rand voted Roosevelt? Franklin Roosevelt? I call a bluff.

[chilon]

Ayn Rand voted Roosevelt? Franklin Roosevelt? I call a bluff.

She did in the first election she voted in, 1931, before she got famous writing against his policies:

http://www.csmonitor.com/Business/20.../FDR-supporter

[Prosaic Visitant]

Ayn Rand voted Roosevelt? Franklin Roosevelt? I call a bluff.

Ronald Reagen did too.

[Sphere]

The only thing Hoover didn't interviene for was the banks, and I think we can surely agree these jews learned their lesson.

Wait What?

The Great Depression is fairly complicated but in short there was a economic bubble in the 1920's in both the stock market and savings&loans industry that burst first in the stockmarket, and then in savings&loan industry. This lead to massive bank runs in a time before the FDIC, which meant the savings of millions of people simply evaporated as banks went under.

The government response made things very bad. As mentioned before, the US instituted huge tarriffs which killed off international trade which in the 1920's was actually a massive part of the global economy, on par with what we have today. The government also tried to balance its books by raising revenues and cutting spending, which added greatly to unemployment. On top of all this, the money supply was in a straight jacket as the US was still stuck in the gold standard, and uncontrolled deflation set in.

Deflation got so bad that for 1932 the annual deflation was -10.3%. What banker or citizen in their right mind would invest or spend their money in a recessionary economy when they were getting a 10%+ return simply by stuffing their money under a mattress? Well that is what everybody did, they stuffed their money under figurative and literal matresses, and economic activity ground to a halt and unemployment skyrocketed.

When FDR came in he took a shotgun approach to the economic crisis, and many of the things he did were inefficent, ineffective or even counterproductive. However, he did three key things.

1.) Starting in 1933, he dropped the gold standard which cut deflation in half for that year (-5.1%), and actually turned inflation positive by 1934.

2.) FDR did not try and balance the Federal Books on the back of a depressed economy. This helped cut unemployment from 1933's ~25% down to 14.3% by 1937. (It then jumped back up again when FDR gave into critics and tried to balance the federal budget through increased taxes and cuts)

3.) FDR reduced tarriff levels through a series of bi-lateral negiotiations with other nations which spurred international trade. (Though this was somewhat marginal as it only dropped overall tarriff levels from something like 20% down to something like 15%)

One can hem-and-hah about the particulars, but thats the nutshell. That is unless you got a political axe to grind.

[Xanthippus of Sparta]

1. The USA already had an economic crisis in 1921, which few know of, becuase this crisis was met by the Republican and economic austrian Warren Harding who did not interviene with other thing that CUTS. He halved statespending and lowered taxes, quite the opposite to todays ideal wouldn't you say? The effect was clear, 6% BNP growth next year and this crisis was soon forgotten. The world would never appretiate austrian economics enough, neither.Not-So-Great Depression, Jim Powell 2007

The problem with that analysis is that people forget the "roaring twenties" had a couple recessions within it, the first of which in 1923-24 (lasting 14 months) when Harding was still president. It wasn't as serious as 1920-21; yet it happened while Harding's economic policies were in full effect. Plus, there was the issue of Harding's appointed secretaries taking bribes, including Interior Secretary Albert Fall who accepted $400,000 to allow oil drilling on public land in Teapot Dome, Wyoming. Three of Harding's appointees would do time behind bars and several more were indicted.

Of course, the Cato instiute is going to leave out that little tidbit.

4. Hoover then expanded statis expentiures, subsidising the agriculture he killed with his protectionism. He also created masses of state work-programs. He therefore increased taxes by shockings amounts when the economics was already crashing down. The only thing Hoover didn't interviene for was the banks, and I think we can surely agree these jews learned their lesson. Moore than 10 000 banks died. Why? They were too concentrated, during this time the banks was by law restricted to not work outside their state, hence national megabanks who could stand against such a depression was by STATELAW impossible. That is laissez faire? In fact, Canada was hit even harder by the collapse as this small country was mercilessly raped by the new tolls of USA, but Canadas banks wasn't restricted by state and guess what? The small nation of Canada didn't lose a single bank during the whole depression. They also didnt have a federal reserve bank till 1935, lucky them. You see during this time of laissez-faire, the statecontrolled fed actually increased interested rates and federal reserves. A monetary history of the united states 1867-1960
By Milton Friedman, Anna Jacobson Schwartz

Is "these jews learned their lesson" a direct quote from Friedman?

[Arch]

The problem with that analysis is that people forget the "roaring twenties" had a couple recessions within it, the first of which in 1923-24 (lasting 14 months) when Harding was still president. It wasn't as serious as 1920-21; yet it happened while Harding's economic policies were in full effect. Plus, there was the issue of Harding's appointed secretaries taking bribes, including Interior Secretary Albert Fall who accepted $400,000 to allow oil drilling on public land in Teapot Dome, Wyoming. Three of Harding's appointees would do time behind bars and several more were indicted.

Harding is a completely new person to me, Im arguing for the free market, not Harding as a person. Ofcurse corruption is wrong in any instance.

Is "these jews learned their lesson" a direct quote from Friedman?

No, that is actually my grandfather, who was half jew.

[Archaalen]

I'm glad everyone here agrees upon one thing: Hoover messed up his chances to head off the Depression before it got going. Agreement even seems to exist about one of the main things he did wrong: raise tariffs. The fact that this was the standard response for Republicans of the era in a downturn has not been examined, but that is neither here nor there. The OP seems to be arguing that there is a direct equivalency between Hoover's and Roosevelt's responses to the Depression, the only difference being one of scale.

I can see one major equivalency between them, and that was one that was completely non-controversial at the time: government intervention to try and help people get through the depression until the economy could recover. Both of them invested in work projects that gave people jobs while trying to improve national infrastructure; on a fairly small scale (from a national viewpoint) with the Hoover Dam and on a much larger scale with the WPA and other similar programs during Roosevelt's terms. As discussed by other posters, even Harding did this. Harding's use of this mechanism would also seem to argue against his being a doctrinaire Austrian.

However, when one looks at a wider array of economic measures of the two presidencies, the equivalency very quickly falls apart. Hoover's responses to the crisis were at the time standard conservative economic responses: Balance the budget and hew to the Gold Standard to ensure "Sound Money", raise tariffs to protect domestic industry, and wait until the crisis had passed. None of this was in any way Keynesian, IT WAS STANDARD PRACTICE among economic conservatives. Keynes also happened to argue for balancing the budget, but only when the economy was growing.

Roosevelt's response, on the other hand, was to completely junk the Gold Standard to break the deflationary spiral, try to lower tariffs to encourage foreign trade, and to deficit spend in order to try and get the economy going again. All of this was precisely opposite to what Hoover had been doing, and was in no way a continuation of his policies on a larger scale.

[Sphere]

Ayn Rand voted Roosevelt? Franklin Roosevelt? I call a bluff.

She also collected social security, and when she developed lung cancer (she believed the link between cigarettes and cancer was a complete hoax), she used Medicare to keep from bankrupting herself.

[YuriVII]

I think one reason that people overlook for the depression is the "will of God."

Now that I got everyone's attention. By will of God I mean Act of God or more specifically the dust bowl. A climatic event during the thirties that covered much of this large country in dust...choking farms an causing large parts of states to uproot themselves and go to the urban areas...where there was no work. So the combination of not being able to live off the land in the much more agrarian America and working in the urban centers combined into an economic effect that didn't make for alot of fun.

Ironically government intervention in the soil conservation project was hugely successful in steming the tide. Apparently the way American ranchers and farmers were doing their business was causing this effect similar the the desertification of the Sahel we see nowadays.

Say what you will about Roosevelt's New Deal, but back in the day his administration knew how to get things done. Things like the Tennessee Valley Authority and all the infrastructure building projects. Making things that transformed our landscape and that we still use today. Roosevelt built five hydroelectric dams in my area...and that is only Central Texas not counting the rest of the country. Now sit back and say those weren't some damn good investments.

[Kanaric]

She also collected social security, and when she developed lung cancer (she believed the link between cigarettes and cancer was a complete hoax), she used Medicare to keep from bankrupting herself.

Lol what a dumb .

That post lowers my opinion even more of her even though I partially agree with her ideas