Comments on: The Crisis that Wasn’t

By: 8

Sun, 31 Jan 2010 02:44:28 +0000

Truman wanted to continue Roosevelt’s policies after the war, but the brief post-war recession led to a Republican victory in the 1946 mid-terms. The New Deal was officially dead. Taft-Hartley, tax cuts, etc. were passed over his veto.

By: Dick Fox

Dick Fox — Sun, 31 Jan 2010 01:44:57 +0000

Never forget there were tax cuts in 1945 and 1948. The 1948 cuts even included a very serious cut that encouraged marriage and the raising of children in the home. This resulted in the lowest divorce rate in our nation’s recent history.

By: The Crackshot Crackpot

The Crackshot Crackpot — Sat, 30 Jan 2010 10:36:49 +0000

No! No! Bob is right. What we need is a little more faith. C’mon you guys!

By: Josh

Josh — Sat, 30 Jan 2010 02:50:49 +0000

The problem with trying to defeat the Keynesians is that they have constructued an unfalsifiable theory. If the stimulus dosen’t work, they Keynesians will claim that the stimulus was too small and we need more deficit financed spending.

If the economy begins its upturn (as it inevitably will, cyclical economic growth is certain), the Keynesians will claim success even when all the evidence shows that the so called multiplier is actually neglibible and sometimes negative.

Keynesian economics will unfortunately always be here.

By: Stranger

Stranger — Fri, 29 Jan 2010 13:40:02 +0000

This event poses a very interesting question. Why were the reductions in government spending creating a quick recovery instead of the of labor and capital chaos that followed the reductions in financial spending of the ’29 crash?

My theory is that the war gave the government the power to break the unions and commercial cartels that prevented competition. After the war there were no unions, hence businesses were free to absorb all the labor released by the army.

By: bob

bob — Fri, 29 Jan 2010 09:55:36 +0000

Don’t forget Japan – stimulus and money pumping worked according to the Keynesians…just not enough and quickly enough to offset that pesky market which keeps insisting on spiraling into oblivion…

Maybe we just need more faith?

By: Mitch

Mitch — Fri, 29 Jan 2010 08:50:28 +0000

Great letter.

It reminds me of my economics professors trying to explain why the stagflation of the ’70s happened or why the “stimuli” of the past two years haven’t righted our country’s imbalances.

For some reason, they will just never admit that Keynes might have been wrong. It’s refreshing to see such heresy published in the WSJ.