I heard him say that government spending didn’t get us out of the Depression. He said unemployment was still at 15% in 1940. It was WWII that got us out of the Depression.
My question is this: wasn’t WWII just an enormous government spending program, financed by debt?
My question is this: wasn’t WWII just an enormous government spending program, financed by debt?
Yep. And everyone was put to work building weapons and laying waste to a large portion of the world. Not exactly “productive” production.
But then afterwards we were one of the few industrial countries that was still intact… and we did pretty good selling stuff to ones that were devastated.
My question is this: wasn’t WWII just an enormous government spending program, financed by debt?
Yep. And everyone was put to work building weapons and laying waste to a large portion of the world. Not exactly “productive” production.
But then afterwards we were one of the few industrial countries that was still intact… and we did pretty good selling stuff to ones that were devastated.
Well, then, sounds like a plan. Let’s get cracking.
My question is this: wasn’t WWII just an enormous government spending program, financed by debt?
I think what people have wrong is that all spending is equal, it’s not.
We can spend a billion dollars on a bridge, but if that bridge is crossing over a river in the middle of nowhere and no one uses it you get far less “Return” than if you build a bridge that is needed and millions use it.
The WPA’s didn’t work because it was focused on “Projects” that had little return. Building a bridge is nice but unless it is a vital bridge it has a very low, long term return. OTOH building a factory that makes tanks that can easily be turned over to making cars or washing machines has a very short term return on investment as well as a much more “Dynamic” return.
The bridge, will always be a bridge and nothing more. The factory will be revamped, retooled and evolve. From tanks, to cars, to SUV’s to electric vehicles. The factory “Grows”, the bridge does not.
After WWII most of the factories were simply handed over to the private sector. I’m not sure how it worked but many local manufacturing companies were started from WWII factories. The “Depression” was not overcome until these privately owned companies took off and that was not until the late 40’s early 50’s, I believe there was a recession around 1947.
In essence you have a depression from 1929-1939, a war going on from 1941-1945 and then a recession 1947-1949. I’m not sure what you would even classify the 2 years after WWII as. I’d guess there was high unemployment with all the soldiers coming home and women in the work force and I’d guess that’s in part what led to the recession in 1947.
In short it wasn’t until all the private sector work started kicking in in 1949-1950 that we started to see some real growth and real recovery.
~Matt