FDR

[Full Quiver]

Most of what I know of FDR was taught to me in the public school system I admit. In fact as a child I considered him the best president ever based on what seemed to be achievements of his administrations.

Now I am beginning to understand that his rule actually furthered the Great Depression and it was only WW2 that got us into better economic times which sorta supports the theory that he knew the Japanese were going to attack and he was all for it. Anyhow that's a debate for another day.

Why was FDR elected to four terms if his policies stunk so bad?

[Mole_J]

FDR was very charismatic and very positive. People felt like he was leading the country in the right direction after hearing him speak. He started the weekly fireside chat, that still continues today with the president giving a weekly radio address.

Many of the poor felt the effects of his policies directly also. Many people were able to get job through some of the organizations he created.

The South in particular benefited from FDR policies. He was the first president to take any interest in the South since Reconstruction.

Although his policies may have extended the depression, they did lessen its impact on many people's lives.

These are just a list of some of the reasons I can think right off the top of my head.

[CantBCoy]

So, policies that extend a "recession or depression" are okay as long as they help a small percentage of people?

[Mole_J]

One thing to remember at this time there was no safety net for people. The unemployment rate was around 25% and most wives did not work outside of the family. So, if the husband lost his job, the chances of him getting another job were small. This left a lot of families without any kind of income.

In many parts of the country, many were farmers. The farmers were already reeling from the price decline of their produce during the 1920s. In the 1930s, the severe drought keep most farmers from growing any crops. Even for those who could grow crops, they made no profits from selling their produce.

1/3 of Americans were living in poverty, it may have been higher.

[TW]

MoleJ,
The highest the unemployment rate got during the great depression was 19%. The biggest problem was with bank failures.


TW

[DaJudge]

One thing to remember at this time there was no safety net for people.

The problem is that the "safety net" has become a HAMMOCK. What was supposed to have been temporary measures to help people in a pinch has become a way of life. Generation after generation of people on welfare, foodstamps, SSI, you name it. These programs were supposed to help people get back on their feet, not give them an excuse to lounge around on their backsides.

[Mole_J]

MoleJ,
The highest the unemployment rate got during the great depression was 19%. The biggest problem was with bank failures.


TW

I found it listed at 24.9% in 1933 online. I know it was online and may not be correct. Here is a link to the FDR Presidential Library and Museum , it maybe incorrect:
http://www.fdrlibrary.marist.edu/unempl71.html

[TW]

MoleJ,
There are two set of statistics on the unemployment rates during that time period, Derby and Lebergot. Derby counted WPA workers as employed because they were earning a wage, Lebergot did not include them in his count as being employed. Thus the difference in the numbers. No amtter which set of numbers that you use 20 > 25% of the work force was unemployed at that point. The average unemployment rate during the entire depression was 13%. The real tragic thing about the depression is that a lot of people lost everything that they had saved when the banks failed.


TW

[Full Quiver]

The real tragic thing about the depression is that a lot of people lost everything that they had saved when the banks failed.

Yet they kept electing FDR.

[dawgs10]

my father who remembers the great depression will tell ya that without fdr many people in the south would have starved to death if it was not for whis policies. the issue then was greed as well as now. hold on to the money at the top as tight as you can and let the workers starve to death. lay off people so that the stock holders can make the same amount they expected last year. fdr told the banks to let go of the money or he would freeze it all. closed the banks got control and made people act like they sould have in the first place. sounds like what we need now. if they wont let go of the money and create jobs take the money and create jobs. force companies to grow or get out!!! its sad that we are to that point but greed caused it.

[Full Quiver]

Since when do people with money HAVE to spend it, have to hire others, have to hand out their earnings, have to continue in business, etc.?

[DaJudge]

Since when do people with money HAVE to spend it, have to hire others, have to hand out their earnings, have to continue in business, etc.?

Amen. To force people to do that is socialism. Of course, we live in a socialist country now, so I guess that would be permissible.

[TW]

Dawgs10,
Your father is right in some respects, he is also wrong in others. He views the Great Depression through the filter of his own experience. It wasn’t simply a matter of hang on to the money at the top and let the workers starve. The Great Depression occurred for a number of reasons.

Most economist and historians will point to the Stock Market crash on October 29, 1929 (Black Tuesday) as being the trigger for the depression. It is important to remember that this was only the trigger, and not the cause. The causes were many and varied. One of the most important was credit. Prior to the crash, credit was easily available for purchasing or investing. The Stock Market crashed because at that time margin requirements were only 10%, in other words, Brokerage firms would lend $9 for every $1 an investor had deposited. When the market fell, the brokers called in these loans which could not be paid back.

Banks began to fail as debtors defaulted and depositors attempted to withdraw their deposits in masse. No bank has the capital on hand to pay out all of their deposits at any given time. This triggered multiple bank runs. Bank failures led to the loss of billions of dollars in assets. Outstanding debt became heavier because prices and income fell by 20 - 50%, however the debts remained at the same dollar amount. In the first 10 months of 1930, 744 U.S. banks failed, and during the entire 1930s 9000 banks failed. Bank failures snowballed as bankers called in loans which the borrowers did not have time or money to repay. With the outlook of future profits dim, capital investment and construction slowed or completely stopped. Faced with bad loans and worsening future prospects the surviving banks became even more conservative in their lending. They built up the their capital reserves and made fewer loans, which in turn increased the deflationary pressures. A “vicious cycle” developed and the downward trend accelerated. The effort to liquidate debt could not keep up with the fall of prices which it caused. The stampede to liquidate increased the value of each dollar owed, relative to the value of declining asset holdings. As debtors tried to lesson their burden of debt they effectively increased it.

Add to this the effects of the "Dust Bowl" drought, and the mass displacement of farm families that it caused. The shortage of readily available money meant that farm prices fell and farmers could no longer afford to produce crops at a profitable level. The construction and logging industries ground to a virtual halt adding to the unemployment problems. With the reduced purchasing power the industrial sector had no one to buy their products and factories shut down or reduced their labor force, compounding the unemployment crisis.

These are just some of the causes that turned the 1930 recession into the 1933 Great Depression.



TW

[dawgs10]

most people are more concerned about the effect and less about the cause. my stance is not that people should be forced to let go of money and give it all away. i do believe that when people are saved they will want to do as much as possible to help others so they find theirselves doing these things rather than being made to. thats the whole point i am making. sometimes christains try to keep their buisness life and spiritial apart. i dont believe that Jesus wanted us to do that. we are to have every aspect of our lives under the blood so to speak. greed and self preservation has no place. and yes, if you do not chose to do what is right i think you should be forced to if it affects others. my opinion. cutting jobs so stockholders can make millions if not billions should be stopped. ceo's making millions more than the factory worker when the company is going down the drain should be stopped. banks refusing to loan money to small business men and home buyers but taking billions from those same people thru taxes should be stopped. GREED!! is the cause.

[DaJudge]

cutting jobs so stockholders can make millions if not billions should be stopped.

Here's the flaw in your logic. You seem to associate stock holders with "rich people". Most stock holders are not John D. Rockefeller. They are ordinary Americans with 401Ks and pension funds who are saving towards maybe being able to retire when they are 65 or 70. If the values stocks go down, their retirement gets wiped out. If a board of directors does not do everything they can (including layoffs, if necessary) to stop the drop of the stock value of their company, then they are being derelict in their duty.