Here's an except/review of Thomas Woods book, 33 Questions about American History::
In school, we learned that the boom times of the “Roaring Twenties” were leading to impending economic disaster due to the "laissez-faire", pro-business policies of three Republican presidents: Warren G. Harding, Calvin Coolidge, and Herbert Hoover. When the Stock Market crashed in 1929, the Great Depression struck, and Franklin Delano Roosevelt was voted into office, replacing Herbert Hoover. FDR heroically started a slew of government programs through his “New Deal”, which put America back to work.
According to Woods, it didn’t quite happen that way.
Although Herbert Hoover was a Republican, he effectively started the New Deal. The FDR administration’s own Rexford Tugwell later acknowledged this, saying: “We didn’t admit it at the time, but practically the whole New Deal was extrapolated from programs that Hoover started.” When the Stock Market crashed in 1929 and the Depression hit, Hoover, in an attempt to “do something”, created the Federal Farm Bureau and Reconstruction Finance Corporation, plus he passed the Smoot-Hawley Tariff. These were interventions that attacked the free market.
Roosevelt’s policies were even more misguided than Hoover’s (Roosevelt himself said that he never read a book on economics.) One day he raised the gold price by 21 cents. When Henry Morgenthau, who later became Treasury Secretary, asked him why, Roosevelt said that "it's a lucky number, because it's three times seven." Morgenthau wrote later: "If anybody ever knew how we set the gold price through a combination of lucky numbers, etc., I think they would be frightened." (You can read about this in a book titled "The Forgotten Man: A New History of the Great Depression,” by Amity Shlaes.)
FDR and his advisers believed that falling wages and falling prices weren’t a symptom of the Depression, but the cause of it. FDR’s National Industry Recovery Act (NRA) created government-sanctioned cartels that set minimum prices, clearly not a consumer-friendly policy. (The Schechter brothers, first-generation Jewish immigrant butchers who paid themselves salaries of $35 per week, were prosecuted under the NRA for engaging in “keen competition”, or giving customers too much choice. They lost their federal court case and were about to serve jail time until the Supreme Court vindicated them. After that rebuke to the NRA, Roosevelt began his controversial, and unpopular, attempt to “pack the courts”.)
The FDR administration also instituted the Agricultural Adjustment Act, ordering six million pigs to be slaughtered and 10 million acres of cotton to be destroyed. All to keep prices up while many people were starving and wearing rags.
Woods correctly challenges the widely taught belief that FDR “ended” the Great Depression, noting that “under FDR, unemployment averaged a whopping 18 percent from 1933 to 1940.” (FDR’s best year was 1937, when the unemployment rate dropped to 14.3 percent, though in 1938 it shot up again to 19 percent.) Keep in mind; this was in the thirties, when most women didn’t work. Adjusted for today, you could practically double those figures. Also, 12 million men (almost 10% of the US population) were conscripted into military service when America entered World War II, so they weren’t showing up on the unemployment line. On top of that, the Stock Market didn’t average pre-Crash of 1929 levels until 1954, when Dwight Eisenhower was in the Oval Office.
Conversely, Woods notes, the historically maligned Warren G. Harding and Calvin Coolidge administrations were marked by peace and prosperity, with unemployment rates falling to as low as 1 percent, while the nation was still recovering from Woodrow Wilson’s entry into World War I and also absorbing millions of immigrants. Woods quotes Coolidge as saying: “Perhaps one of the most important accomplishments of my administration has been minding my own business.”
