The myths contained herein are most likely nothing new to anyone here, but here’s an excerpt of what’s being taught at a local school regarding the Great Depression:
What was the Smoot-Hawley tariff; why was it significant, and how did tariffs in general contribute to the GD?
How long did the GD last?
What caused the GD?
What was Hoover’s reaction to the GD? (republicans reaction)
What economic philosophy and political party did Hoover subscribe to?
What is Rugged Individualism?
Describe the spiral of doom. Why did some Americans think capitalism had failed?
What caused the Dust Bowl and what impact did it have on the nation and its people?
How does consumer-spending impact the economy?
What is the Federal Reserve and what does it do?
[The SPIRAL OF DOOM referenced above is shown below]:
End of WWI (Europe didn’t need our wheat) > Overproduction > prices go down > companies/farms loose profit > Cut spending > Buy on credit > cut spending > Companies loose money > Layoffs > Unemployed people don’t spend $ > Foreclosures go up > Banks fail > Raise tariffs > Raise interest rates trying to stop people from buying on credit > Only 2% upper class can buy goods > Companies loose more money > Unemployment goes up > 1 BIG cycle!!
Saved by WWII
-Gov Spending
-Gov hiring
If I had a cake and ate it, it can be concluded that I do not have it anymore. HHH
in the second half of the 1920s there was massive agricultural overproduction
This is my very favorite statist myth: overproduction. "O no, there's too much food, we're all going to die! Ahhhhh!" LOL...
They used this same argument to promote imperialism - i.e. "we must access foreign markets because overproduction in advanced economies is causing falling rates of interest/profit." Amusingly, this was Marxist dogma, but it was pushed by the big crony capitalists leading up to the Spanish-American War and beyond. There's a good book on the subject in the literature section, I'll post the link if I can remember the title.
But anyway, yes OP, history at all levels has been woefully perverted - and intentionally, compliments of the Rockefeller Foundation et al.
Minarchist:This is my very favorite statist myth: overproduction. "O no, there's too much food, we're all going to die! Ahhhhh!" LOL...
Are you suggesting there is no such thing as "overproduction"? Maybe not in an absolute sense, but I think those of us who aren't "bubble denyers" would suggest calling overproduction a "myth" is a bit too far.
ThatOldGuy: Consumer-spending impacts the economy because since it is a free-market economy, its growth depends of consumer spending.
Was this quoted from a textbook?(!)
Minarchist:This is my very favorite statist myth: overproduction.
Well, a good question would be: why was there an overproduction? I wouldn't call this a myth, per se, but it is lazy to start the "SPIRAL OF DOOM" off with something as vague as overproduction (especially when the "lifestyle of the 20s" is seen as a sufficient reason).
It's not uncommon for someone to go out of business: people, including entrepreneurs, are not infallible. But something should be suspicious when everyone in several (usually, capital intensive) industries seems to make very similar mistakes at the same time; a "cluster of errors" as it were. Of course, the excerpt above is from a history class and not all historians are necessarily economists.
z1235:Was this quoted from a textbook?(!)
For all I know, it might have been. A friend sent me this information and said that it was a study guide. I remember reading as much regarding the Great Depression in school. I remember telling my history teacher -in front of the class- that Hoover was anything but laissez-faire and that FDR's running mate went so far as to state that Hoover "was leading the country down the road to socialism." FDR's secretaries said that their administration had just taken many of Hoover's schemes and made them bigger. There was a pause and the teacher said, "Ok- moving on..."
Good times.
There is no such thing as overproduction in a free market. Obviously bubbles brought about by State intervention are another matter.
I suppose I need to clarify my comment. If by overproduction you mean a boom leading to a bust (as in the 20's), then the myth is that such boom is a free-market phenomenon, when rather it is a result of State intervention.
But if you mean overproduction in the sense that prices are falling and this collapses profit margins (as I mentioned in connection to imperialist propaganda in the 19th century), then this does indeed occur in a free-market, and thank God! So the myth would be that this is a bad thing, when clearly increasing production and falling prices is a good thing (save for the crony capitalist who likes monopoly-rent fattened profits or the old money banker who sees the relative value of his capital slipping away).
If it were from text, it's more realistic than the garbage I sat through in the early 90s. I didn't have outside sources and influences to go to for real history, but I at least knew that public school teachers that promoted the same perspective that the state is our salvation was flat out wrong. Growing up with hippies taught me to distrust government, but a yearning to learn taught me to question the facts and dig deeper.
I walked out of my last high school history class, told the administration I couldn't listen to the rhetoric (and the teacher really didn't care for me correcting him regularly). They waived the course for my diploma, so I sat in the library during that period for the rest of the year reading real books.
Those instructors even back then were generally wound up in the state as savior. This is why I am on the verge of pulling my own kids and homeschooling them. I just need to finish my own degree so I have the time.
Minarchist:Are you suggesting there is no such thing as "overproduction"? Maybe not in an absolute sense, but I think those of us who aren't "bubble denyers" would suggest calling overproduction a "myth" is a bit too far.There is no such thing as overproduction in a free market. Obviously bubbles brought about by State intervention are another matter.
...then I guess it's not a "myth" then, is it.
(Unless of course you want to argue that "non-free markets" are a myth.)
As I said in the previous post....
the myth is that such a boom is a free-market phenomenon, when rather it is a result of State intervention.
This is less coherent than the normal view of the great depression, at least that revolved around a massive stock market bubble which gave a reason for the massive calculation failure which lead to the depression.
I remember in my APUSH class we learned that the problem was that wealth inequality rose, and the rich spent to little... Which was bad.
Minarchist:As I said in the previous post.... the myth is that such a boom is a free-market phenomenon, when rather it is a result of State intervention.
...You mean a previous post to someone else after I made my initial comment and you responded to it.