all years | 1929 | 1939

 1930  The Slump Deepens

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President: Hoover (R); Senate: Watson (R-IN); House: Longworth (R-OH).

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Late in 1929 President Herbert Hoover had received an analysis from the Federal Reserve that the correction had several months to run. Hoover was glad to expand a public buildings program to boost the economy. But the stock market continued to decline, as the president signed the Smoot-Hawley Tariff Act into law. Then the Jewish-owned Bank of United States in Manhattan failed.

In the 1930 US Senate Elections the Democrats gained 8 seats from the Republicans. In the 1930 US House Elections the Democrats gained 52 seats. In the 72nd Congress the Republicans controlled the Senate with 48-47 seats, and the Democrats controlled the House with 217-217 seats.

Letting the Banks Fail

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Intention: intentLiberal Line: lib
Outcome: outcomeConservative Line: con

Tariff Act of 1930

Although President Hoover had pledged to reduce tariffs on imports to the United States in early 1930 Congress sent a tariff bill to the president in the spring. Sponsored by Senator Reed Smoot (R-UT) and Representative Willis Hawley (R-OR) the Smoot-Hawley Tariff Act implemented a plank of the Republican Party platform of 1928. While calling for lower tariffs the president had also promised to protect farmers from the world market. In the end, despite an appeal from over a thousand economists President Hoover signed the bill in June 1930. Nations across the world retaliated in kind.

 

Intention: High tariffs would protect American manufacturers, American workers, and American farmers from foreign competition.Liberal Line: Typical Republicans, carrying water for their business and rich-farmer paymasters.
Outcome: High tariffs violate Ricardo‘s Law of Comparative Advantage and reduce trade between nations.Conservative Line: Clueless solons on Capitol Hill busily screwing up the economy.

all years | 1929 | 1939

1929-1939: “A Decade that will live — in stupidity.”

Why Stuck on Stupid?

Seventy years ago the leaders of both US political parties turned away from the policies that had created an economic powerhouse we call the Roaring Twenties. For ten long years Americans suffered through wrenching economic dislocations: deflation, inflation, a four-year economic contraction, endless unemployment, mindless political experiments, and ruthless attacks on businessmen for political gain as their leaders stayed Stuck on Stupid.

Today, after a twenty-five year economic boom, Americans are once more faced with a political elite that wants to monkey with success. It wants to raise tax rates. It wants to restrict trade. It wants to increase government power.

It’s time to look back and remind ourselves how it came to be, starting in 1929, that America got itself Stuck on Stupid. Otherwise it could happen again.

 — Christopher Chantrill

 

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presented by Christopher Chantrill
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