Reviews for America's great depression

The average rating for America's great depression based on 2 reviews is 4.5 stars.

Review # 1 was written on 2011-05-15 00:00:00 Sebastiaan van Eekeren This is a torrid love letter to laissez faire economics sure to raise a fiscal chubby on fans of the Austrian School of Economics (ASE). Of course, if limited government (i.e., NONE), free markets (i.e., unrestrained capitalism) and non-intervention with the money supply (i.e., the Federal Reserve must go) are not under-pinnings of your own economic beliefs, or (i.e., the ASE is just not your bag), this book may cause hives and periodic bouts of severe chafing. I kept a jumbo jar of Aloe next to me while reading in case I started to itch. Now, if you're not entirely sure what your tolerance for the invisible fist hand of laissez faire is, I’ve included the following excerpt from the book which should be more than adequate to help you test your relative placement along the spectrum of economic theory: If government wishes to alleviate, rather than aggravate, a depression, its only valid course is laissez-faire – to leave the economy alone. Only if there is no interference, direct or threatened, with prices, wage rates, and business liquidation will the necessary adjustment proceed with smooth dispatch. Any propping up of shaky positions postpones liquidation and aggravates unsound conditions. Propping up wage rates creates mass unemployment, and bolstering prices perpetuates and creates unsold surpluses. Moreover, a drastic cut in the government budget – both in taxes and expenditures – will of itself speed adjustment by changing social choice toward more saving and investment relative to consumption. For government spending, whatever the label attached to it, is solely consumption; any cut in the budget therefore raises the investment-consumption ratio in the economy and allows more rapid validation of originally wasteful and loss-yielding projects. Hence, the proper injunction to government in a depression is cut the budget and leave the economy strictly alone. Now take a moment to examine yourself for any severe physiological changes and you should have a good idea of where you reside in relation to the Austrian School. PLOT SUMMARY This is one of the classics of the Austian School written by one of its staunchest proponents. In it, Rothbard sets forth the foundational tenets of ASE philosophy and then ruthlessly applies them against what he describes as the disastrous actions of the government from 1921-1933. Actions that he argues led inexorably to, and greatly extended, the Great Depression. Rothbard traces the inflationary practices of the Federal Reserve (which the ASE despises and considers the earthly manifestation of SATAN) beginning in 1921 and argues that the Fed's manipulations of the money supply and its artificial expansion of available credit was a root cause of the factors that would eventually lead to the Great Depression. Rothbard explains that when money and credit become too easy to obtain, the market spends the money unwisely and it leads to an over supply of unneeded assets (the BOOM) that must eventually be liquidated (the BUST). The arguments made by Rothbard are more expansive and far more detailed, but that is the gist. Rothbard then turns to President Herbert Hoover and the gloves come off as he presents a scathing indictment that places the vast majority of the blame for the depth, breadth and duration of Great Depression squarely at the feet of what Rothbard calls the "interventionist" policies of the Hoover administration. Rothbard begins his historical smack down by debunking the commonly held view that President Hoover was a hands off, free market supporter and that it was his adherence to the principals of “laissez faire” that led to the onset of the Great Depression. Rothbard argues that this is 180 degrees wrong and goes to great lengths to demonstrate how the “do nothing” President had both hands up to the elbow inside the economy trying to manipulate the market. This chronicle of the Hoover adminstrations policies takes up the last half of the book and is incredibly well laid out and pretty nasty. Among Hoover’s many “interventionist” mistakes, Rothbard discusses: ** Hoover's "voluntarism" which Rothbard decries as nothing more than massive government coercion of the country’s leading companies to “maintain wage rate, expand construction and cooperate regarding allocating reduced work.” ** Pushing for the passage of the Smoot-Hawley Tariff which had a significantly negative effect on international trade just as the economy was in decline.    ** Weakening bankruptcy laws which allowed unsustainable companies to continue to operate rather than being able to redeploy their assets into more productive endeavors.  ** Encouraging the Federal Reserve (i.e., SATAN) to expand credit, reduce interest rates and bolster shaky financial positions, thus continuing to encourage bad investments and speculation.     ** Pressuring Employers’ to maintain current levels of employment and not make required layoffs.   ** Imposing limits on immigration and deported illegal aliens (Hoover was hoping to reduce unemployment by “reducing supply” in the available workforce.   ** Pushing for laws limiting the hours construction workers on Federal projects could work per day.   ** Publicly condemning short selling and supporting legislation banning the practice. ** Enacting one of the largest tax increases in history while the U.S. economy was tanking. All of these actions Rothbard argues had the opposite effect from what the Hoover administration intended and led the United States into the worst economic downturn in its history. The analysis and the support for his position is cogent and if not always engaging. Whether it is persuasive or not I will leave to you as much of the answer to that question will depend on what you bring with you to the reading. FINAL THOUGHTS For me, I couldn't buy off on all of his assertions but that has nothing to do with the presentation of Rothbard's work in this book. I found his case well laid out and it was obvious that he has a firm command of his subject matter. He appeared just as comfortable discussing macro philosophical principals as he was applying those principals to a specific historical example.  Overall, this was an interesting, thorough analysis of the causes of the Great Depression from a perspective I had not previously encountered. It is certainly worth checking out by anyone with an interest in economic history and philosophy whether or not you end up drinking the kool-aid and buying off on Rothbard's conclusions. 4.0 stars. Highly Recommended (unless you begin to chafe).

Review # 2 was written on 2008-10-20 00:00:00 Margaret Stewart Rothbard's great analysis of the causes of the Great Depression is one of the classics of Austrian economics and a must-read for serious libertarians. Rothbard presents conclusive evidence explaining the crucial mistakes made by Herbert Hoover and later exacerbated by FDR, that deepened and prolonged what should have been a short and sharp depression. The Federal Reserve is also fingered as the culprit that expanded credit and the money supply and created the stock market bubble in the first place. I read it several years ago and am rereading it now for the book club meeting.