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Kasz216 on 09 September 2012
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Mr Khan said:
Kasz216 said:
nuckles87 said:

These jobs are only temporary, but as has been done in the past, these jobs are meant to only jump start the economy so that consumers will have the money to begin buying products again, and allow new private businesses to thrive, begin hiring more people to keep up with demand, so that when these public projects are finished workers will have places to go in the private sector.


The problem is... this has never worked.  BECAUSE said jobs are temporary.

The last 4 years have show that.  (As well as... pretty much every stimulus ever done.)

Buisnesses know said demand is temporary and as such won't expand due to it... because well...  they aren't stupid.

 

All it ever does, is temporarily boost GDP numbers for as long as spending goes, until something else completely increases demand and fixes the economy.

That's what's weird about all the calls of a "New New Deal."   If you ask Economists... 9 out of 10 will tell you the New New Deal failed... and the 10th will likely tell you it mostly failed until WW2 came along.

So you're saying we should nuke China

Shrewd...

In all seriousness there are a lot of factors in WW2 that might be unproduceable and any or all of them could be involed in the recovery after the great depression.

 

1)  Forced Austerity.  Everything was rationed and their was a social stigma against spending.   As we had to put most of our production towards tanks, bombs, planes and bullets, this meant less cars, and pretty much everything.   Things like nylons and cans and such were rationed because the matierals were needed for the war.  Lots of consumer goods were price controlled, but were near impossible to find/keep in stock.

How this may have effected the economy - After WW2, suddenly this stuff was widely available.  It was like these products came out as new for the first time ever.   There were YEARS worth of demand for cars that built up, as the car companies were all making Tanks.  Not to mention people leaving the army wanting to live it up.

 

2) Defacto Forced investment.   Due to the forced Austerity, there was pretty much nothing to do with your money... except invest it. 

 

 

How this helped - People put this money in the economy and warbonds, and further increased value and spending after WW2.

 

3) Free Trade.   After WW2 there was suddenly a HUGE increase in free trade, as Europe Japan and China needed things rebuilt, and the US and other untouched countires could supply it. 

 

How this may have helped - Products had new markets.  The US in particular became a huge exporter.  Argueably this is when US culture took it's root

 

4) WW2 put the fear of god into people.  - WW2 was ascary.

How this may have helped - a huge war that made people afraid of "evil controlling the world" is a great reason to convince people to live in the now.   Espiecally when suddenly there are single bomb that can wipe out big cities.