"Pooh Bear" wrote in message
...
wrote:
I look forward to a day when people realize that government usually does
more harm than good when it interferes in the market.
Whilst there is much to be said in favour of that view, how do you reckon
the
'market' would have dealt with the Great Depression ?
Graham
If governments hadn't created it?
It seems to me the Market did deal with it, it just took a bit longer
because of Government trying to help.
Hopefully the market would have rejected Keynsian economics in favor of the
Austrian Ludwig Von Mises.
In 1927, Mises issued a prophetic warning: "The program of antiliberalism
unleashed the forces that gave rise to the great World War and, by virtue of
import and export quotas, tariffs, migration barriers, and similar measures,
has brought the nations of the world to the point of mutual isolation.
Within each nation it has led to socialist experiments whose result has been
a reduction in the productivity of labor and a concomitant increase in want
and misery. Whoever does not deliberately close his eyes to the facts must
recognize everywhere the signs of an approaching catastrophe in world
economy. Antiliberalism is heading toward a general collapse of
civilization."
Many people seem to think it was to much Capitalism that caused the
Depression when the opposite is true, it was rampant interference form
Government.
The market has not been free to act without government interference for a
very long time, so I can't say how it would have solved the Depression,
other than to grow our way out if left alone, which is what seems to have
happened. It didn't hurt that there was increased demand for heavy
equipment to fight WWII with, but I don't think WWII is the sole cause for
the end of the Great Depression. It most likely would have taken longer to
end had not government gone into debt to try and get out of it, but they
wouldn't have needed to had government not created the Depression in the
first place.
Corrective forces in the market were set in motion, once the monetary
expansion had come to an end. But the depth and duration of the Great
Depression turned out to be far greater and longer than would have normally
seemed to be required for economy-wide balance to be restored. The reasons
for the Great Depression's severity were not to be found in any inherent
failure of the market economy, but rather in the fact that political
ideologies and government policies of the 1930s hampered the recovery.
It seems axiomatic, that when government does not interfere, business along
with other human endeavors seem to thrive.