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The Truth About Hoover and the Great Depression
Does austerity lead to economic depression? One often hears that cutting government spending now would derail our nation's fragile economic recovery, and perhaps even throw the economy into deep recession. Advocates of this view sometimes point to the Great Depression as evidence that dramatic cuts to government spending lead to economic disaster. If only Herbert Hoover had been more like Franklin Roosevelt, we hear, there might have never been a Great Depression. However, as the Bush Institute's Amity Shlaes points out in a recent column for Bloomberg, the problem with the "Hoover austerity" explanation for the Great Depression is that Hoover did not actually practice austerity. Rather, under Hoover's watch, the size of government increased substantially. Federal spending grew to $4.8 billion in 1932 from $2.9 billion in 1929. Under Hoover there were severe policy errors — credit markets were too tight, wages were not flexible, and tariffs were downright disastrous. But austerity was not one of them, and that is a lesson today's policy leaders would be wise to remember.
TARIFF-IED: Trade Talk with Matthew Rooney
Bush Institute-SMU Economic Growth Initiative Director Matthew Rooney breaks down the trade conflict with India.
How Trade Spreads Holiday Cheer
It is projected that the average American household will spend more than $1,000 during the holidays this year.
Deporting Salvadorans May Lead to Economic Decline
We should think carefully about a policy whose major impacts are likely to be reductions in employment and economic activity here at home, and increased instability and lawlessness along our borders.