| History lessons from the great depression |
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shanecurran
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| History lessons from the great depression |
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The great depression had many causes. We try to study the causes of the great depression so that we do not repeat the same mistakes. I believe what is more interesting and more important to look at is the slow recovery: why the downturn lasted as long as it did.
One of the policies under FDR was the forced cartelization of companies, starting in 1933 under the National Industrial Recovery Act. The idea was that if he forced companies in given industries to cartelize then they could charge higher prices and in return the companies could afford to pay higher wages to their employees (also enforced by the administration). Looking back, anyone with an introductory level of economic training can see why this was a bad idea.
In reality it slowed the recovery because it increased unemployment and artificially raised prices. The lesson should have been do not experiment with economic fundamentals during periods of slow growth. The policies of the NIRA are similar to some of the policies we have now with extensions on unemployment benefits. We should not offer incentive for people to stay out of work. Once again we are ignoring economics with policies that are popular for a particular segment of society.
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Tue Apr 05, 2011 6:38 pm |
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NolaP
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I agree with this, in theory. In some cases though it's not feasible though to expect people to be able to find a job at the moment - they just aren't out there. Bur in many cases there may be options for those that push. After three years out of work and unable to find a job my 40 year old brother joined the military and is doing well. I'd like to think, however, that the government has our backs, and is willing to help out those in need who can't find a job. I don't think anyone who is out of work is enjoying collecting unemployment. And private industry needs to do more to help out, especially those that are doing well and were helped out in the bailouts. No more raises or bonuses, just more jobs.
Nola
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Thu Apr 07, 2011 2:25 pm |
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coaster
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| Re: History lessons from the great depression |
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quote:
Originally posted by shanecurran
The great depression had many causes.
I think that's the most important lesson to be learned. You can't kick this economy into a depression with one kick. It takes many well-aimed and well-timed kicks. And while most people understand the concept of learning from history (at least after they get old enough and start realizing they're making the same mistakes their parents made) ... while they understand we should learn from history, what fails is that nothing is ever repeated exactly, and if a similar event might occur, it might have a very different cause or causes. Cause and result need to be seen in very, very broad strokes for them to be paired with any sense of seeing a repeated result based on a known cause.
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Fri Apr 08, 2011 5:06 am |
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payment proof
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I wish that banks had learned better lessons from the Great Depression. Making bad loans that couldn't be paid back happened in the Great Depression and again in this recession.
This is an interesting point:
One of the policies under FDR was the forced cartelization of companies, starting in 1933 under the National Industrial Recovery Act. The idea was that if he forced companies in given industries to cartelize then they could charge higher prices and in return the companies could afford to pay higher wages to their employees.
But a big part of the problem in this recession is the exporting of jobs to other countries. If a country keeps exporting jobs to other countries, their will be less jobs within that country.
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Mon Apr 11, 2011 1:23 am |
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coaster
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quote:
Originally posted by payment proof
I wish that banks had learned better lessons from the Great Depression. Making bad loans that couldn't be paid back happened in the Great Depression and again in this recession.
I would point at our brilliant Congress. People like Barney Frank, who made it possible for them to do that.
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Mon Apr 11, 2011 3:52 am |
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shanecurran
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quote:
Originally posted by payment proof
But a big part of the problem in this recession is the exporting of jobs to other countries. If a country keeps exporting jobs to other countries, their will be less jobs within that country.
I disagree. The job market is continually changing in the U.S. as well as other countries and any policies that intend to keep jobs here will have unintended consequences that are worse.
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Mon Apr 11, 2011 12:54 pm |
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terrancebrandt
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Pertains to exporting jobs, at some point that is one of the many issues. However, we cannot blame those businesses that needs the expertise (or hard labor) of overseas workers because they cannot find workforce in the country of origin since the wanna-be-staff would not accept DOE rates.
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Fri May 06, 2011 6:35 pm |
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