If WWII ended the Depression, why didn't the Iraq War prevent/end our current Recession?

[Phoebe Loosinhouse]

I ask that of all the people who say FDR's New Deal had nothing to do with pulling the US out of the Depression and it was all due to the war and defense spending that we pulled out.

If that is the case, the MASSIVE defense spending and current wars we have been engaged in should have prevented us from having our current economic issues at all.

[bdamomma]

1. FDR's plan worked.

[davepc]

2. The two situations are in no way comparable.

[Trajan]

7. If you see relavent differences ...

Please explain them ...

[endarkenment]

20. google the spending levels of WWII and compare

or is the googler not working for you?

[Trajan]

34. You have a google ?

Aw shit .... I have GOT to get me one of those ...

Heh ? ... You are wrong : Go google it to find out why ...

[Deep13]

3. I was just talking about this last night.

I was wondering if the 1974 recession was caused by the sudden end to the Vietnam war and Project Apollo. It may be that without the Iraq War, the present situation would be even worse.

[nebenaube]

4. simple...

We haven't laid waste to the competition yet!

[bluestateguy]

5. It could have

If we had brought back the draft, and compelled everyone to serve. If we had doubled, no tripled, the size of our military, and tripled defense spending. If we had moved to a total war footing, and converted all of the factories into defense plants, then yes it could have worked, but only temporarily.

[sufrommich]

6. It wasn't the military spending that raised the standard of

living in post WW2 America,it was the fact that the rest of the industrial world was reduced to rubble.We were relatively unscathed and production went on as usual,giving us a leg up economically.

[newfie11]

8. I have also wondered that.

I have seen where people say WW111 will solve the problem. It is unbelievable that someone would think that. I think if it comes to that we will have much bigger problems then we do now.
:nuke:

[Demit]

9. Because there were 16 million troops involved in WWII? And millions more at home

actively engaged in jobs that went toward the war effort? That's one way WWII differs from the war in Iraq, the scale of it—even though I don't agree with the underlying premise of the right wing's argument that WWII is the ONLY thing that ended the depression.

[Phoonzang]

We'd need a total war. I suggest declaring war on a large country that doesn't have nukes.

We need a war that will grind on for at least 5 years and cause massive casualties on both sides. Um....Germany again?

[YOY]

10. Because war doesn't alway stimulate an economy.

n.t.

[JaneQPublic]

11. Keep in mind...

...that the people who claim FDR's New Deal had nothing to do with ending The Great Depression are also now claiming that Herbert Hoover, though GOP, was a Progressive.

I believe the term is "Revisionist History" -- a tactic near and dear to the GOP heart, as the only way they can rationalize their failed philosophies is to go back in history and change the way things actually occurred.

[Desimal]

12. The New Deal ended the Depression

And WW2 was a fair war. Hitler needed to be anihilated.

War was only part of the economic boost though.

[Graybeard]

26. Welcome to DU.

[bluestateguy]

13. When conservatives make that argument about WWII they prove our point

They say that WWII ended the Depression. OK, stipulated. And what did government do? They spent money, tons and tons of it, which put people to work and brought about full employment.

What? You mean government spent money to end the Depression? Yes, exactly.

[treestar]

32. Exactly, why does spending on war work whereas spending

on something non-destructive supposedly does not? Republics have no explanation for this.

[WeDidIt]

14. Because Roosevelt's tax plan and the legislation that stopped

war profiteering allowed the war effort to stimulate the economy.

Bush, on the other hand, cut taxes for the rich during a war and insured war profiteering would happen through de-regulation which ended up making the IRaq War the largest transfer of wealth from the lowest 99.9% of the population to the top 0.1%, thus devestating the economy.

[jberryhill]

15. That's one part

The other part is that WWII was a competition in quickly ramping up industrial production.

But, yes, this war has simply been a massive transfer of wealth.

[Vinnie From Indy]

16. This one is simple - outsourcing

The investment in WWII was also an investment in the American worker. While the war profiteers at that time had no alternative to using American labor, now they do. In addition, our modern tax system allows corporations to avoid paying taxes. War profiteers have contructed a system whereby they can make even more profit by cutting the American worker out of their sacking of the US Treasury.

[terisan]

17. Unemployment remained very high-14.6-19% in late 1930s-plummeted to 4.7 1942.

War buildup-Lend-Lease and then high gear war production may have had significant impact in reducing unemployment tremendously.


Here's a look at the U.S. unemployment rate for selected years from 1920 to 2007.

Year Rate
1920 5.2 %
1928 4.2
1930 8.7
1932 23.6
1934 21.7
1936 16.9
1938 19.0
1940 14.6
1942 4.7%
1944 1.2
1946 3.9
1948 3.8
1950 5.3
1952 3.0
1954 5.5
1956 4.1
1958 6.8%
1960 5.5
1962 5.5
1964 5.2
1966 3.8
1968 3.6
1970 4.9
1972 5.6
1974 5.6%
1976 7.7
19781 6.1
1980 7.1
1982 9.7
1984 7.5
19861 7.0
1987 6.2
1988 5.5
1989 5.3
19901 5.6%
1991 6.8
1992 7.5
1993 6.9
19941 6.1
1995 5.6
1996 5.4
19971 4.9
19981 4.5
19991 4.2
20001 4.0
2001 4.7
2002 5.8
20031 6.0%
20041 5.5
20051 5.1
2006 4.6
2007 4.6
NOTES: Estimates prior to 1940 are based on sources other than direct enumeration. Data prior to 1948 are for persons age 14 and over. Data beginning in 1948 are for persons age 16 and over.
1. Not strictly comparable with prior years.
2. Beginning in Jan. 2006, data are not strictly comparable with data for 2005 and earlier years because of the revisions in the population controls used in the household survey.
Source: U.S. Department of Labor, Bureau of Labor Statistics. Web: stats.bls.gov .

[theblasmo]

25. 1938 Unemployment Figures

The GOP line now is how unemployment seemed to go up for 38's figures, but that's because the government stopped counting many of the CCC personnel as "employed", not because unemployment itself shot up. It's similar to and completely opposite to how Reagan told us employment had shot up during his first years, but they had just decided to start counting the military in the employment figures, which might be looked on as cheating to make things look good. What saved our ass during Reagan's first years was his slow reversal of his quickly-passed tax cuts in order to get more money in the coffers, which he didn't advertise as publicly as the cuts he'd originally made that helped cause the recession of the early 80's.

If anyone would like to confirm or debunk these with some specific facts or references, I'd appreciate it, since I'm running from memory only here, and could easily be mistaken. Many thanks.

[jacksonian]

28. one thing to remember anout the 1930's

that there was an economic disaster of international porportions, much like today. Capital dried up as bank failures swallowed people's savings, much like today.

But in the US at least, the scope of the depression was fueled as much by ecological disater as much as financial, unlike today. Oh, we have environmental problems, but not like what faced the midwest back then. The dustbowl radically eliminated agriculture in the farm belt, completely wiping out the economies of vast areas of the country - and we were a much more agricultural society in 1932. This was not something solved directly by spending money, you can't just turn Kansas into a manufactoring economy overnight. The government did everything it could to solve the problem, indeed, many of these ecological solutions are still working today, but the hard process of putting dirt back on the earth was really slow and not solvable by just sending out checks.

Point two - the Depression was four years old when Roosevelt took office, again, unlike today. Massive economic infrastructure was lost in those four years as Hoover did too little, too late. Once you get to cronic economic meltdown, it is really hard to put back what you have lost. A lesson for today - under-react at your peril. Once unemployment becomes not what it is today - people losing jobs and looking for new ones while producers hope to wait out the recovery, and the economy becomes people cronically out of work and giving up and producers having no hope and giving up and nobody trusting banks, it becomes increasingly hard to jump start anything. This is what Roosevelt ran into, but it doesn't mean what he did wasn't right. It was - increasingly hard to jump start does not mean one shouldn't try. What stats don't show is otherwise things would have been worse.

What the war did was change the equation. Massive employment for the war effort with intrnational markets destroyed but demanding huge supply meant obvious cash in people's pockets, but the war stopped any increase in consumer production as materials were needed for the war. After the war, people had idle cash they previously couldn't spend, international markets were wide open, and things boomed. If a world war destoyed much the world but left us intact, we would be sitting pretty, too - but I don't think we really want to go there.

[global1]

18. Don't Give The Bush Legacy Team Any Ideas.......

cause soon we'll hear that Bush prevented this economic crisis we're now in from hitting us earlier during his tenure and harder - because of the Iraq War. We'll hear that if he didn't act when he did - this crisis would have been far worse and come on sooner than it did. After all - he did inherit that from the Clinton Administration. (sarcasm)

[endarkenment]

19. As others have noted FDR's plan worked.

The recession of '37 was in part brought on by a change in course and a reduction of government spending urged by fiscal conservatives within the FDR administration.

The level of government spending in WWII was off the charts and in no way resembles the spending on the Iraq War (either one), the Vietnam War, or any other war we have ever been in.

[man4allcats]

21. Funny you should ask.

I was just thinking about this very thing this morning. I'm reading Naomi Klein's book The Shock Doctrine - The Rise of Disaster Capitalism. Though she wasn't discussing WWII or Iraq, it occurred to me as I read that WWII was a war with a clear and just purpose. Hitler had to be stopped. Only Chamberlain and a few other enablers doubted the premise. Hitler was the early incarnation of Bush at a time and place in history when he could wreak the havoc Bush would have if the world hadn't already seen that monster once. No sane and decent person questioned the necessity of destroying Hitler; hence, the war had almost universal support. It cost money to fight, but it made money too because people believed in and worked to support the war effort. Iraq was a lie from the beginning. Most of us on this board always knew that, and virtually everyone knows it now. It is a money sucking hell hole with no support that people rightly want to be free of. I firmly believe that FDR's New Deal played a large role in pulling us out of the Great Depression of the 30s and that the near unanimous support for the WWII war effort also played a large role in this country's economic recovery of the time. Iraq has had no such effect because it is an obvious fraud that people don't want to have anything to do with. Yes, the government is spending billions on the Iraq war every month, but we the people aren't behind it, and without us the federal bureaucracy is nothing - a fact they seem to have forgotten in recent years.

[RollWithIt]

22. The Entire US mobilized for the WWII War Effort

Bush asked the nation to do jack squat for Iraq. I think he asked people to shop or something.

[uponit7771]

23. WWII didn't end the depression, the nations GDP started pickin up the second Roosevelt was in office

[DCBob]

24. WW2 caused a US economic spike was because most of the rest of the world was decimated...

We were essentially the only major industrial nation capable of producing equipment, supplies and services the rest of the world needed to rebuild and recover.

[slackmaster]

27. World War II was a just war, and had almost universal support of the entire population

That's why.

School children participated in scrap metal drives. Families collected and turned in meat drippings to be processed into explosives. Everyone was involved, and wanted to win. The goals of our involvement were clear.

[GarbagemanLB]

29. WWII and Iraq are not comparable at all in terms of size.

[Numba6]

30. Don't u konw up is down & day is night in the new meme?

Republicans’ Latest Talking Point: The New Deal Failed
http://www.nytimes.com/2009/01/12/opinion/12mon4.html?_r=2&pagewanted=print

Once Upon a Time in Republican Land...
http://www.dailykos.com/storyonly/2009/2/9/01244/95631/561/695061


McCain Claims FDR ‘Exacerbated The Great Depression,’ Calls For Counterproductive Balanced Budget Provisions
http://thinkprogress.org/2009/02/05/mccain-fdr-depression/


Limbaugh, Hannity, and the GOP: an iron triangle of stimulus misinformation
http://mediamatters.org/items/200902070003

[Skwmom]

31. Did we supply the equipment or is most of it built overseas? Secondly,

a lot of money was fraudulently sucked out of the U.S. Treasury.

[Every Man A King]

33. The New Deal worked

WWII and almost as importantly the GI bill finished the job. Remember FDR always wanted the New Deal to be bigger, WW2 proved that bigger would have been better.

Also there is no comparison between Iraq and WW2. We had about 6 million soldiers by 1944 not even counting air force and navy. The Army was not high tech like today. The war was won by shear economic output, for example over 50,000 Sherman tanks were built in brand new factories largely filled with women workers for the first time in history. Also you have to include Lend lease program to USSR and Britain which required not just weapons but all basic staple products, food etc...

[Zynx]

35. For one thing, Iraq spending is far lower. For another, this spending is pissed away overseas.

The New Deal did work to an extent though. GDP had surpassed its 1929 levels by 1940.