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Archive for April 6th, 2009
Lessons from the 1920-1921 Depression
Monday, April 6th, 2009
About nine years before the onset of the Great Depression, a short, but severe depression struck the US around 1920. For example:
The one-year drop in the GNP price deflator was the steepest ever in US history.
The one-year plunge in wholesale prices was the worst in recorded history.
The ratio in percentage decline of the GNP price deflator compared to real GNP was the worst ever.
Unemployment more than doubled.
So, how did the US recover so quickly?
President Warren Harding, who actually inherited a $25 billion debt from the previous administration, implemented spending cuts, tax cuts, and free market capitalism. He cut federal spending by 21%, began to pay off national debt, and cut taxes on corporate revenues and “excess” profits. He allowed prices to plummet, and he refused to bail out failed banking & business institutions.
As a result, by 1922, GNP rebounded 6% and unemployment dropped 43% to 6.7% overall. This astonishingly quick rebound from a severe, one-year depression served as a springboard to the “Roaring ’20s”.
Now, compare this recovery to that of FDR’s “New Deal”. From 1933-1940, unemployment averaged 17%. Unlike Harding, FDR significantly raised taxes, increased government debt, bailed out a number of banks & businesses, and launched massive, public works projects. The nation did not commence a full-fledged economic recovery until a year after World War II in 1946.
Our leaders, both Democrat and Republican, would do well to study and implement many of the successful strategies which stopped the 1920-1921 Depression in its tracks. Limited government, spending cuts, tax cuts, and free market capitalism work.
Read the articles here, here, and here.
Glenn Beck to speak at San Antonio Tea Party
Monday, April 6th, 2009
Beck will attend the April 15 Tea Party in San Antonio, in front of the Alamo. While we welcome yet another major media player, let us never forget that the people, not media celebrities, are the heart and soul of this nationwide, grassroots movement.
Estimated taxpayer cost for bailouts rises again
Monday, April 6th, 2009
The Congressional Budget Office (CBO) now estimates that US taxpayers will be on the hook for $356 billion instead of $189 billion as a result of the first bank bailout known as TARP. Is this really any surprise? It will likely be revised upward yet again in the coming months. Bailout costs will continue to grow at an alarming rate unless we put a stop to it.
Read the article here.
Lessons from the 1920-1921 Depression
Monday, April 6th, 2009About nine years before the onset of the Great Depression, a short, but severe depression struck the US around 1920. For example:
The one-year drop in the GNP price deflator was the steepest ever in US history.
The one-year plunge in wholesale prices was the worst in recorded history.
The ratio in percentage decline of the GNP price deflator compared to real GNP was the worst ever.
Unemployment more than doubled.
So, how did the US recover so quickly?
President Warren Harding, who actually inherited a $25 billion debt from the previous administration, implemented spending cuts, tax cuts, and free market capitalism. He cut federal spending by 21%, began to pay off national debt, and cut taxes on corporate revenues and “excess” profits. He allowed prices to plummet, and he refused to bail out failed banking & business institutions.
As a result, by 1922, GNP rebounded 6% and unemployment dropped 43% to 6.7% overall. This astonishingly quick rebound from a severe, one-year depression served as a springboard to the “Roaring ’20s”.
Now, compare this recovery to that of FDR’s “New Deal”. From 1933-1940, unemployment averaged 17%. Unlike Harding, FDR significantly raised taxes, increased government debt, bailed out a number of banks & businesses, and launched massive, public works projects. The nation did not commence a full-fledged economic recovery until a year after World War II in 1946.
Our leaders, both Democrat and Republican, would do well to study and implement many of the successful strategies which stopped the 1920-1921 Depression in its tracks. Limited government, spending cuts, tax cuts, and free market capitalism work.
Read the articles here, here, and here.
Glenn Beck to speak at San Antonio Tea Party
Monday, April 6th, 2009Beck will attend the April 15 Tea Party in San Antonio, in front of the Alamo. While we welcome yet another major media player, let us never forget that the people, not media celebrities, are the heart and soul of this nationwide, grassroots movement.
Estimated taxpayer cost for bailouts rises again
Monday, April 6th, 2009The Congressional Budget Office (CBO) now estimates that US taxpayers will be on the hook for $356 billion instead of $189 billion as a result of the first bank bailout known as TARP. Is this really any surprise? It will likely be revised upward yet again in the coming months. Bailout costs will continue to grow at an alarming rate unless we put a stop to it.
Read the article here.
