Their little pouty fat gooper lips are moving again.

Republicans may be inclined to create their own reality, but they shouldn't create their own calendars.

Doesn't that go hand-in-hand with creating your own reality? Your own version of reality, with its own history and dates.
Anyhow, I recommend everyone save a copy of that chart, just cut and paste as needed--which will probably be a lot.

I would be interested to hear Rep. Austria's explanation of the graphic. I'm sure that he would provide an intellectual discussion of the data.

You write: "First, Austria's argument is a reminder of why negotiations between the White House and congressional Republicans aren't going to go well -- ever. On the one hand, we have a president who seems to care a little too much about engaging the minority party in good-faith policy discussions. On the other, we have a party comparing itself to the Taliban and publicly arguing that FDR created the Great Depression."

Actually, negotiations are going very well. It is precisely because Obama has sought Repub input that all this ignorance and idiocy is coming out into the open. Let's have more discussions, please. Obama only needs a few of their votes. What he needs even more is for the rest to expose themselves as the irrelevant, even dangerous, crazies they have become.

I'm not even old enough to run for his seat yet, and even I know this. I'm not just saying it because I learned it in some high school class and am reciting it for the sake of doing so, it's just painfully obvious enough; if this guy doesn't even know the basic facts of our economic history, it's pretty disheartening to think about the quality of some of our represenatives as a whole.

Roosevelt couldn't "put our country into a Great Depression" with the New Deal because 1933 comes after 1929. Republicans may be inclined to create their own reality, but they shouldn't create their own calendars.

Huh?? Now you're creating the calendar. Our nation's premiere Constitutional scholar and historian knows that FDR went on television when the stock market crashed in 1929.

You'll have to forgive Mr. Austria, as he grew up in Zenia. Getting whacked in the face with all those tornado-tossed bricks, trees, and flying cats does something to a teenage kid---even a GOPer shill-to-be.

Hey---you ever been hit in the face by a 200-mile-per-hour cat? It ain't pretty. Check the un-natural, baby-eating smirk on the guy's face at his website. He's like an evil cross between Ledger's "Joker" character and Gumby....

Congressmen Austria also went to say that the only one who can save us from the pending stimulus disaster is Robert Taft.

Taft as has been his way for the past 56 years declined to comment.

The House of Representatives is a big place, and it's natural that it should contain some yahoos and lunatics. What I don't understand is why All Republicans, sane or insane, vote the same way.

I would love to clip and save the chart, once the vertical axis is labeled correctly. But, however bad the economy was in 1933, it wasn't zero; and however great it was in 1945, it was not 100 percent. (100 percent of what? Please explain.)

I am not one of those right wingers. If it was up to me, I would declare the neoCons members of a criminal conspiracy, charge them with thinking bad thoughts, and ship the lot of them to GitMo.

Even so, I don't think we need to be pushing stuff like this. I'm sure GDP fell dramatically in the early thirties, then recovered during the remainder of the decade. But it didn't fall to zero, then bounce back to 100 percent.

Obviously, Steve knows nothing of science, Republican-style. Roosevelt's actions in 1933 caused the Great Depression in 1929 due to the same eccentricity in the Sun's orbit around the Earth that caused 9/11/2001 to take place during the Clinton administration.

republicans apparently don't do history well. i once heard the long-time local county republican chair blame roosevelt for the munich agreement in 1938 -- even though fdr was about 5,000 miles away from the conference.

Frankbel - it's not really that difficult - what the chart is showing is change in the GDP from it's 1932-33 low just when Roosevelt took office. By 1937 the GDP was 40% higher than 1932-33 - by 1941 it was almost 100% higher, etc.
it's the little percentage symbols after the numbers that are the giveaway.

mudwall:
I swear there was a post here 5 minutes ago by Al blaming FDR not only for Munich, but for Prohibition.

Next they'll be demanding that FDR's head be taken off of Mount Rushmore.

By the end of the 1930s, FDR's Treasury Secretary, Henry Morgenthau, told the House Ways and Means Committee, "We have tried spending money. We are spending more than we have ever spent before and it does not work. ... I say, after eight years of this administration, we have just as much unemployment as when we started ... and an enormous debt to boot."

Interesting that Michelle Malkin and Austria have so much in common. One would have thought educations at Oberling and Marquette could have prepared them better. First generations and, yet, lacking in any knowledge of US history.

But, Al was correct - FDR should have taken that pistol away from Adolph at the Burgerbraukeller, the night of the Putsch. Should have hit Schicklegruber upside the head with a stein.

@frankBel:
I think that's just percent above its all-time low. IOW, the GDP almost doubled (compared to the low in 1932) as a result of FDR's stimulus. Here's a spreadsheet.

Austria seems to be trying to mess with the space-time continuum. Perhaps he should get a new job - writing for a sci-fi TV show or movie.

I swear there was a post here 5 minutes ago by Al blaming FDR ... for Prohibition. - hells littlest angel

You're not the only one who saw it. Kinda spooky, if you ask me.

[Sorry about that - it accidentally got swept into the electronic dustbin with some link spam that I was deleting. It didn't rise to the level of requiring moderation, and I would have enjoyed the fisking you guys would have given it. -Mod]

Al was sorry for the lifting of the Prohibition by FDR - Forced Al to have to keep drinking.

But, how about, all heads being removed on Mount Rushmore and that sacred mountain returned to the Lakota nation.

Time and space have a liberal bias.

Wait, didn't Hitler gobble up Austria in '38?

.

James Galbraith had more FDR-Depression myth-busting last night in his interview with Amy Goodman.

He reminds us that folks who worked for jobs programs like the CCC weren't counted as "employed." If they were, the anti-Depression efforts look even better.

Maybe a historian can answer this question. Looking at this graph that Rachel Maddow used, I am wondering if, when you extend that graph to today, you will see that whenever the Republicans are governing, the line is going down. Have the Republicans always been about greed and powergrabs?
And if so, why hasn't anybody ever pointed this out?

I'm not just mentioning this to make fun of a dimwitted conservative Republican lawmaker. Sure, it's part of my motivation, but there's more to it than just mockery. -- Steve Benen

What a downer. Sure sure we come here to discuss real issues, problems and solutions, but to completely dismiss the fun of helping the American Taliban self-detonate is simply depressing.

Did FDR make it clear when campaigning in 1936 and 194 how much the GDP had grown since he had taken office?

Does anyone know the source of the legend that the economy did not actually rebound until the build-up to WWII?

What is the explanation for the continuing high levels of unemployment (cf the quote above from Morgenthau) despite such strong growth in GDP? IE, did they count the work done by WPA in GDP but not count the WPA participants as "employed"?

Why does Paul Krugman (among others) continue to maintain that FDR's program was a failure because the borrowing/spending was too small a fraction of GDP? That looks like a very strong effect for such a small stimulus. Is PK unaware of this?

The point that everyone is missing is how did someone so ignorant of history or else such a liar ever get elected to the US House of Representatives? Of course, lying does help Republicans get elected.

hells littlest angel: Obviously, Steve knows nothing of science, Republican-style. Roosevelt's actions in 1933 caused the Great Depression in 1929 due to the same eccentricity in the Sun's orbit around the Earth that caused 9/11/2001 to take place during the Clinton administration.

"What is the explanation for the continuing high levels of unemployment..."

There are several parts to an answer to this question.

First the depression was a really big deal, and the stimulus in the US wasn't big enough until WWII to kick the economy completely out of its low output mode.

Second some "unemployment" numbers for the 30's also count people employed by WPA and a few other programs as "unemployed". Which is useful for answering some questions, but not for others. So the number of people suffering without job dropped more than some charts seem, at first glance, to indicate.

Third the word "continuing" in this context is right wing spin. It implies stability but the reality is that unemployment dropped every year FDR was in office except for the 37-38 recession when the stimulus was reduced. It started at 23% (25% if you don't count jobs programs) so it had a loooooong way to fall. However it did fall very quickly. In 1936 unemployment (where WPA people are counted as employed) was down to 12%, so unemployment had fallen by half. It went back up to 16% during the recession, then continued down when the stimulus was resumed.

I don't agree that Krugman says the program was a failure. What he says is that it seems likely that a bigger stimulus would have been a bigger success. Unemployment would have dropped faster, the economy would have recovered quicker.

Heck had what turned out to be the correct policy been initiated in 1930 one could imagine an alternate history lacking WWII...

PS if you look at the unemployment and gdp charts you will see that employment seems to lag gdp changes by up to a year.

Does anyone know the source of the legend that the economy did not actually rebound until the build-up to WWII?

The source of the "legend" is the fact that the general public misery of the Depression lasted until into WWII, because unemployment and low wages remained very high (though much lower than the ~25% it had reached at the time Roosevelt came into office) up until war mobilization (a) put people to work, and (b) reduce the civilian labor force by putting lots of people into the military, and (c) provided justification for wage controls that led to a great equalization in the distribution of income that persisted even after the formal controls were lifted for several decades after the war.

Since most people know that the "Great Depression" lasted until into the war, people tend to assume that the weak aggregate economic conditions persisted for the whole time, when in fact there was a strong aggregate recovery with a weaker recovery in employment, and, for its aggregate strength, poor distributional features.

What is the explanation for the continuing high levels of unemployment (cf the quote above from Morgenthau) despite such strong growth in GDP?

Economic growth periods with poor distributional effects are not unknown, particularly when the regulatory environment doesn't favor broad distribution of gains (for a good recent example, see the 2001-2007 expansion.)

That having been said, unemployment fell from its worst point of 25% at the beginning of 1933 to something like 16% at the peak of the 1933-1937 expansion, and IIRC rose to around 18% during the 1937-1938 recession, and then dropped during the post-1938 expansion. Unemployment was very bad during that time (despite having improved considerably) because it had gotten utterly miserable under the years of ineffectual policy and continued economic decline under Hoover from 1929 through 1932.

Why does Paul Krugman (among others) continue to maintain that FDR's program was a failure because the borrowing/spending was too small a fraction of GDP?

Where, precisely, does Paul Krugman "continue to maintain" that? In most of his writing on the topic, Krugman seems to credit the New Deal with being successful in terms of aggregate stimulus, and generally successful though incomplete (and poorly institutionalized) in terms of policies that serve to encourage broad distribution of economic gains.

What is the explanation for the continuing high levels of unemployment (cf the quote above from Morgenthau) despite such strong growth in GDP?

Pretend temporarily there is a 1%-1% correlation to GDP and unemployment. GDP goes down 50% - unemployment rate goes up to 50%. Then the GDP increases by 50% from it's low - hey - that's a huge increase - but it really only means that it is at 75% of it's former level. And that means that employment is now only at 75% of it's former level - or the unemployment rate is at 25% - pretty high even though the GDP growth was fantastic.

But in fact there isn't a 1-1 ratio of GDP to employment GDP is expressed as an whole amount - but population is always growing. So GDP rate doesn't reflect population growth (as in GDP per capita), but you always need to generate X number of jobs just to account for population growth - so you can have an increase in economic activity (GDP) without a corresponding increase in employment rates.

If GDP goes from $1 billion to $2 billion - that is a 100% increase - but if the population doubled in that period is anyone really any better off?

PS
Following is an article with graphs of the unemployment rates where WPA & etc are counted as employed or unemployed:
http://tpmcafe.talkingpointsmemo.com/2009/01/21/unemployment_statistics_of_the_new_deal_era/

The second chart has as its solid line a widely quoted data set which counts WPA & similar program workers as unemployed, the dashed line counts them as employed.

Who knew the Governor of New York had such power???

Andy says: Frankbel - it's not really that difficult - what the chart is showing is change in the GDP from it's 1932-33 low just when Roosevelt took office. By 1937 the GDP was 40% higher than 1932-33 - by 1941 it was almost 100% higher, etc.
it's the little percentage symbols after the numbers that are the giveaway.

Just maybe you're right about that--there's no way to know if it's not just an editing error--in which case it'd be about the least intuitive, dumbest-technically-true way of expressing that information.

Indexes, which is what you're describing, aren't usually expressed with percentage signs, and the index value is usually set at 100 (not zero), and the index value is usually the first or last, not one smack in the middle.

A roadmap with west at the top and distances measured in light-years would be correct too, but I'd stop short of implying that people confused by it were stupid.

I'm not at all surprised. A few years ago a dittohead I used to work with tried to tell me that Clinton and Gore gave Pakistan the secrets to building the nuclear bomb. Of course Pakistan went nuclear as early as the Reagan presidency, well before either Clinton or Gore could possibly have had access to said nuclear secrets.

daryl--which Robert Taft? Whether alive or dead, Robert Tafts of any generation tend to be slightly more verbose than your average rhododendron, and a lot less colorful.

OK, I'll bite.

what does the chart mean?

there is a scale on the right side. What does it mean?

The GDP went down to 0% in 1933? What does that mean?

Is there some magic year where the GDP was 100%? OK, I am sure that we actually HAD a GDP in 32 so it wasn't 0% of any number.

The point still makes sense that the GDP started to improve with Roosevelt and that we had a 'recession' in 37.

But the chart doesn't make any sense.

A common error to confuse GDP with wealth or financial health.

If I buy $50,000 worth of luxury items on my credit card that I can't afford, my consumption goes up as a matter of course. Such is the nature of borrow and spend. The telling factor is if the end of the day my financial position, or wealth, increases enough to get out of the hole.

Morgenthau again: "We have tried spending money. We are spending more than we have ever spent before and it does not work. ... I say, after eight years of this administration, we have just as much unemployment as when we started ... and an enormous debt to boot."

it does not work

we have just as much unemployment as when we started

Was he overly pessimistic?

JeffF, Andy, cmdicely -- any thoughts?

cmdicely, I have been trying to find the Krugman quotes in which he granted that FDR's spending was ineffective. No luck so far. Neither can I find any quote by him saying that the spending was successful. I found lines from him saying that the 1937 attempt to reduce spending produced a bad effect, but not the contrapositive (is that correct?) assertion that deficit spending actually produced any good effect.

I'd say Morgenthau was wrong. The effects seem to have been quite dramatic.

I believe that the data they had on unemployment at the time was worse than the data we have today so he may not have been actively rejecting clear data. The US started collecting comprehensive unemployment data in the 30's and didn't stabilize it's methods until 1940.

Wikipedia says the following: "Morgenthau was an orthodox economist who opposed Keynesian economics and disapproved of some elements of Roosevelt's New Deal." He also seems to have been a big deficit hawk, so was predisposed to oppose stimulus policy.

It isn't the case that Morgenthau was a supporter of stimulus who changed his mind having tried it. He was a skeptic who apparently did not change his mind.

Funny how the right wing references to this I am finding always seem to omit the information that Morgenthau had always opposed the stimulus idea.

http://www.novelguide.com/a/discover/egd_02/egd_02_00366.html

It sounds like Morgenthau had a significant hand in the 1937-38 recession. From the novelguide article:
"Early in 1937 the economic indices were suggesting that the recovery was solid, and Morgenthau began plans for balancing the budget. That fall, however, the economy took a serious plunge. Morgenthau responded by insisting even more strongly that the budget be balanced, now not as a happy consequence of, but as an instrument of, recovery. When Roosevelt ignored him and took the advice of Harry Hopkins and Federal Reserve Chairman Marriner S. Eccles to renew spending in April 1938, Morgenthau threatened to resign."

The recession ended immediately

Morgenthau also was not FDR's first choice as Secretary of the Treasury. He was head of the Federal Farm Board and was moved up when Secretary of the Treasury Woodin became ill after less than a year (he died the following year). Woodin seems to have been fully on board for all aspects of the New Deal, unlike Morgenthau.

I found lines from him saying that the 1937 attempt to reduce spending produced a bad effect, but not the contrapositive (is that correct?) assertion that deficit spending actually produced any good effect.

Instead of being willfully dense in order to pretend you're some kind of actual disinterested commenter when in reality you're just looking for some kind of attention to give you credibility, why don't use use the magic of google to investigate the effect of Keynesian stimulus during the Great Depression? In addition to the experience of the United States, there were numerous experiments to prove it out in the form of programs pursued by various countries. To wit:

Sweden adopted an aggressive Keynesian program of deficit spending focused on public works, minimum wage, health care, and welfare programs. France, on the other hand, was controlled by rightists whose rigid ideology prevented them from engaging in the same kinds of government stimulus and instead pursued a regiment consisting of little but low taxes, a balanced budget, and anti-inflationary measures. The result? Sweden was the first country worldwide to exit the Depression while France remained mired in a stagnant economy for years.

and that would be "regimen" not "regiment"

I think I'm going to start looking for a scholarly review of "Forgotten Man", Amity Shlaes' senior project that somehow is now taken for a work of economic history.
Not Krugman's nitpicking, but a full-blooded review that examines her methodology or the lack thereof, by an out-of-the-arena scholar looking for a lightweight lunch. Something along the lines of David Hackett Fischer's description of "The Patriot": he said it was to history what Godzilla was to biology.

I found lines from him saying that the 1937 attempt to reduce spending produced a bad effect, but not the contrapositive (is that correct?) assertion that deficit spending actually produced any good effect.

That's not the contrapositive, it's the converse.

If A implies B then the converse is B implies A , or equivalently (not A) implies (not B), which is the form you're using. The contrapositive is (not B) implies (not A). If the original statement is true the contrapositive is as well. The converse, however, may or may not be true.

but I'd stop short of implying that people confused by it were stupid.

No Matt, but in arguing against it, to start blathering that it must be wrong because "however bad the economy was in 1933, it wasn't zero; and however great it was in 1945, it was not 100 percent" without entertaining the idea that perhaps since the economy can't possibly be "zero" that that is a completely wrong interpretation of what the chart is saying strikes me as pretty clueless.
It's not exactly the way I would have presented the chart either, but it wasn't at all difficult to figure out what it was trying to say either

bbbar on February 11, 2009 at 11:23 PM, JeffF,

Thank you

I know this is too late for anyone to read but....

Can you really trust a chart that says GDP was higher in 1937 than it was at the start of the depression?????

Why does everyone here want to swallow the left wing kool-aid?

trex, you make an interesting point, that this web page is the least informative of all my reading. Still, I like the interchange.

Here's from google, which, I suppose, would be a start:

[edit] Effectiveness

China was one of the first nations to launch a substantial fiscal stimulus package, and the Financial Times reports that both government officials and private investors are seeing signs of recovery, such as rises in commodity prices, a 13% rise in the Chinese stock market over a period of 10 days, and a big increase in lending -reflecting the government's success in using state owned banks to inject liquidity into the real economy. The article also reports some analysts are saying its too soon to be sure the Chinese recovery will last. [32]

Senior analysts have not yet found similar grounds for optimism about an early recovery for western economies. Martin Wolf, financial editor at the FT has said that the US stimulus package may not be sufficiently large, and has advocated 'shock and awe' tactics , meaning much more robust intervention. Wolf also sees 'temporary public control' of troubled banks as a necessity and has criticized the ineffective policy of using public money to insure banks against loss or buy toxic assets. [33] [34]

[edit] Criticism

For policy makers and their supporters around the world, Keynesian solutions are currently seen as representing the best option for shielding their populations from arbitrary market-forces; and possibly as engines for addressing inequality, achieving social progress and accelerating the transition to a green economy.

Nevertheless the Keynesian revival has attracted heavy criticism. It is questioned by commentators on the left whether the Keynesian resurgence has been sufficiently strong - in their view Obama's economic team is disappointingly centrist, with its inclusion of liberal leaning economists like Jason Furman. [35] [36] Also there is Germany whose administration, according to some, stands out in their reluctance to wholeheartedly embrace Keynesian policy [37]. From the right, some commentators assert the late 2000s crisis was caused not by excessively free markets but by the remnants of Keynesian policy , for example the Federal Reserves interventionism in the early 2000s which encouraged the sub-prime lending boom.[38] Most critics focus on arguing that Keynesian policy will be counter productive - as it will be inflationary, cause consumers to rein in their spending even more as they anticipate future tax rises, as well as various other technical reasons. [39] [40]

trex, the "counterproductivity" results from "opportunity cost", exemplified by Bastiat's "broken window" fallacy.

MatthewRMarler wrote: this web page is the least informative of all my reading

Given the massive efforts you obviously undertake to maintain your deliberate ignorance, I'm not surprising. It's also not surprising that you contribute negatively to the information content of this sute by posting nothing but bad-faith bullshit.

Still, I like the interchange.

Obviously you enjoy repeatedly posting bullshit, intellectually dishonest, bad-faith right wing talking points and then ignoring your betters when they shoot them down time and time again. Why else would you keep doing it?

That doesn't make you an honest debater, though -- it just makes you an asshole. You aren't fooling anyone, not even, I'll wager, yourself.

Shame on you, Marler.

Can you really trust a chart that says GDP was higher in 1937 than it was at the start of the depression?????

But it doesn't say that at all. what makes you think that it does? there's nothing in the chart to indicate that those are nominal numbers - it is a % change from a fixed point - and the % change going down (i.e. 50% down from 100 is 50) is always more in nominal terms than the same percent going up (50% up from 50 doesn't equal 100, but equals 75).

Better right wing trolls please...

Wow, I was wrong. GDP was slightly higher in 37 than in 29. But not for the reasons Andy states

Andy: what do you think the numbers on the right mean?

What does it mean when the number was around 0 in 1933?

the chart shows % change in GDP from the low point in 1932-33

here are the numbers from the BEA website
The second column is GDP in nominal dollars (the number reported at the time, without taking into account inflation/deflation), the third column is in terms of real (2000) dollars the fourth column is the change from 1933 nominal, the fifth is change from 1933 real

1929 103.6 865.2
1930 91.2 790.7
1931 76.5 739.9
1932 58.7 643.7
1933 56.4 635.5
1934 66.0 704.2 117.0% 110.8%
1935 73.3 766.9 130.0% 120.7%
1936 83.8 866.6 148.6% 136.4%
1937 91.9 911.1 162.9% 143.4%
1938 86.1 879.7 152.7% 138.4%
1939 92.2 950.7 163.5% 149.6%
1940 101.4 1,034.1 179.8% 162.7%
1941 126.7 1,211.1 224.6% 190.6%

It's pretty apparent that the chart is showing GDP change from 1933 in terms of real 2000 dollars

Speaking of bad faith, note that Marler didn't provide a cite.

FDR didn't create the depression, but his policies prolonged the length of it. Government projects have end dates, so his stimulus spending created temporary work. Which is why the unemployment rate never changed much during the 30's. But he also was a party of a global trade war, raising taxes, and rising interest rates. These all hurt consumers.

Now Obama's package is about $1T on top of the nearly $1T from last year. That'll mean additional interest payments on the national debt. So that money has to come from somewhere, which would have a negative effect on the economy.