Thursday, December 04, 2008

The Great Depression is Depressing

Just been reading a book called "The Great Depression: Opposing Viewpoints".  I started reading it because of the problems our economy is in and talk has sometimes come around to the Depression.  Joe Bidden mentioned the Stock Market crash of 1929 during the Presidential election.  He made some errors about the facts but the issue is on some minds.  I wanted to see if there were similarities between then and now.  I have often heard that we learned a lot from those times and we now have safeguards in place so we keep it from happening again.

My reason for reading the book was to see if I could determine what people did who avoided much of the problems of the Depression, after all not everybody was hungry and destitute.  The best answer I can come up with is that it is better to be the person who has money and is lending it out rather than the person who is borrowing money.  I believe you are probably better off to have a few thousand dollars but don't owe anything on your car or house than to be a person with millions in debt flying around in a leased Jet.  Many of us would rather be the second guy but that may change.

So now I finished the book and I'm worried.  The book makes use of speeches and newspaper articles, etc written at the time of the Depression and written on both sides of a topic.  Both sides sometimes did not mean Liberal or Conservative but sometimes meant Liberal and Radically Liberal.  As I read these viewpoints I hear a lot of familiar statements.  In many ways it sounds much like today's news. 

There are two really big questions I still have about the Great Depression, Why did it start? What happened to bring it to an end?

I don't believe anybody has the "real" answer to those two questions.  There are many theories and most of those come from whether you believe Government should regulate businesses as well as the people or not.  Both sides made really good points.  I personally tend to think that the Government should stay out of our business for the most part and that if it did problems would correct themselves.  Of course I have no way of knowing if that would really work because it's not been tried under pressure.  On the other hand a person who believes in Government regulations may also say their methods haven't been tried either as many believed FDR did not go far enough with his resolutions and that is why it took about 10 years to come out of the problems. 

Maybe the answer as in much of life is *balance*.  Most of the time the Government should stay out of the way but in times of crisis the Governments (Federal, State, Local) are in unique positions to  devote money and resources to correct.  As with the Depression many programs were begun but are no longer with us.  Only a few survived once the economy recovered. 

Any way causes or solutions I don't have an answer-- but unfortunately I am of the belief that we have not yet learned enough to avoid the problem again.  I hope I'm wrong.  We have difficult financial times which much of the current news blames on lack of management by the outgoing Republican Administration.  We now have an incoming Democrat Administration determined to "fix" the problems by Government regulation. Maybe they can fix the problem in 10 years or maybe their regulation will drag us through difficulty for 10 years.  I personally hope neither is true, mainly because I don't want to go through 10 years of difficulty no matter what the reason.  But I do think it's beginning to sound a lot like 1932.

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