The parallels of the Great Depression and today’s economy are remarkable. While there are some differences and the causes vary, the government’s approach to recovery is quite similar. I wonder then, what can we expect for results?
In 1929 the stock market crashed, the GDP plummeted and unemployment skyrocketed, just like 2008-2009. For three years the economy began a slow recovery according to all indicators, though for the average American times were still very tough. Then FDR took office.
During FDR’s first 2-1/2 years in office it looked as though his Keynsian recovery policies were doing a great deal of good for everyone.
But then in 1936, the GDP fell even further, unemployment rose even more, the money supply declined, the value of the dollar crashed and inflation flew off the charts. The reason for this, unsustainable economic policies.
During FDR’s New Deal, the federal spending percentage of the GPD rose to over 50 percent, and the national debt percentage of the GDP rose to over 120 percent.
Compare that with today. The national debt has risen rapidly to nearly 100 percent of the GPD and it will exceed 120 percent if BHO gets his second stimulus.
Federal spending is at 45 percent of the GDP and is rising fast.
FDR’s unsustainable borrowing and spending led to a worsening of the depression between 1936-1941. Many experts believe that had FDR not been elected, recovery from the depression would have taken between for and six years. The reality is, real recovery didn’t occur for 12 years. BHO is following the same path, should we expect different results? The answer is no, history tells us he will plunge us into worse financial crisis.
In 2010 please support and vote for candidates who are fiscally responsible. Big spending government doesn’t solve any problems, it only creates more.