| ManusJustus said: I like how people try to say that government spending doesn't help the economy, that the New Deal and Keynesian economics did not work. You ask them, "then what got us out the the Great Depression?" "World War II." "Isn't war a form of government spending?" "Uh..." |
Actually,
What really got us out of the great depression was a destroyed Europe begging for American exports to help them out. During the Great Depression, exports and imports dropped 66%. After WW2, they increased massively, and we had a major trade imbalance that favored us creating jobs. So WW2 was the reason for us getting out of the depression - we became a world superpower, which favored our exports for decades.
As you can see, there was about a 200% increase following WW2.
Now, when did the joyride end? The 1980s:
Ironically, when we started importing more than we exported, was also when our government deficits started ballooning. Correlation? Maybe.
Back from the dead, I'm afraid.
