A 20th Century Economic Theory

From the Great Depression through now. 2 separate Economic Transitions. (A Brain Fart started in 2009.)

The Great Depression may have been triggered by monetary/economic BigGov policies, but it was probably caused by the loss of farm and manufacturing jobs (Economic Transition, Technological Revolutions And Financial Capital).

The Great Depression was not "solved" by the New Deal. In fact, the New Deal may have lengthened the depression (Great Duration). (On the other hand, it probably did reduce the number of people starving to death in the meantime.)

It was fixed by the combination of post-WorldWarII re-investment (creating demand/growth) combined with the peak in effectiveness of the Industrial Age and BigWorld scale.

  • to state that a little differently, in 1946 the US was the only industrial power in a position to sell to the rest of the world (because all the factories in Europe and Japan were bombed to pieces). So Globalization worked for us for awhile, as we traded finished goods for raw materials.

This growth was sufficient that the overhead of New Deal redistribution was "affordable". This led to growth of the Middle Class. (Golden Age)

When economic growth slowed, as post-war rebuilding and resulting momentum had dissipated, and as Globalization spread, the cost of New Deal became more significant.

Any lessons for handling Credit Crisis 2008? Any hope to "save" the Middle Class, or are we doomed to Collapse?


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