Basically, my take on the depression is that Hoover massively screwed the pooch by intervening where he shouldn’t have and not intervening where he should have. Much of the damage was done by the time Roosevelt came into office, but he too made mistakes that prolonged the depression. One can make a reasonable argument that things were so screwed for so many people by the time Roosevelt came to office that policies to help those people, even if they increased unemployment or decreased GDP, were necessary. After trying to point this out a couple times in the comment thread, I’m accused of bad motives and spreading lies:
I’m going to be charitable and assume that this is because you’ve written before you’ve thought carefully about what you wanted to say, and I’m not going to assume you’re ignorant or lying.
But the Daniel Davies dictum applies here: good arguments don’t need lots of untrue things said about them.
By just suggesting Roosevelt made some mistakes and he did things to prolong the depression, I’m branded an idiot and its suggested that I’m ignorant or lying. I was going to write this reply, but it got to be too long:
Professor, we can fight about what is the proper counterfactual, but your appeal to them works in reverse. What counterfactual do you assume that puts the observed time-series below (in the case of unemployment) where they would have been sans New Deal policies? You’re such a fan of C. Romer… she says there was no moderation of macro time-series after the depression/war. If she’s to be believed, 1930’s unemployment, well into the Roosevelt administration, was much above historic levels (before or since). This seems to be a pretty good counterfactual. Why was unemployment so high in that decade? A legacy of Hoover policy and continuing poor macro policy by Roosevelt perhaps?
BTW, I buy Romer’s argument about Roosevelt’s monetary policy at the end of the decade got us back to a good equilibrium, but that’s not to say he didn’t make poor choices before that. But as you seem to misinterpreting me easily (and making frustratingly quick swipes at my motives), I’ll repeat that I don’t blame him as he was exploring uncharted territory in terms of macro policy.
In any case, you conceded the point that sometimes economic efficiency (unemployment) has to be traded off for policy that alleviates economic deprivation. This is the same as conceding Roosevelt’s policies to help the poor had the effect of extending the depression. Its an open question whether or not Roosevelt’s trade-offs were a bad thing.
Also, I’ve said that Roosevelt, given the state of economic science at the time, performed much better than Hoover and that Hoover’s interventions (in labor markets and with tariffs) made a probably-bad recession into a depression. That’s not the margin I’m arguing on, that’s not the argument the WSJ editorial (subtitled “Herbert Hoover was no proponent of laissez-faire.”) was addressing and yet you keep coming back to that. Its weird, really.
(PS – your appeal to Davies’ dictum is cute, but I never said anything that was false. The agriculture tariffs in 1930 had little effect on the 1938 unemployment rates in that sector by the argument I made above. I’ll admit my first two comments weren’t 100% clear as to what time periods I was talking about, but that’s why I clarified in a later post. Also, I made a case for using ba476 and you haven’t rebutted any of my arguments. Finally, I never mis-characterized what is being measured by that series as I made an argument for why we shouldn’t use “emergency” workers that, again, you didn’t respond to. But the data issue is moot. Unemployment was extraordinarily high under Hoover and then Roosevelt no matter which series you use.)
Clearly, its a mistake to stand in the way of love.
UPDATE: Later on, he wrote “Please go away, and don’t come back.” Cool. Never been banned from anybody’s comments before. Its funny that this is coming from an expert on the Great Depression. You’d think academic experts would be open different ideas about their area of expertise.