The depression continued in 1932 and President Herbert Hoover actively intervened to reverse it. Congress passed and the president signed the Reconstruction Finance Act. It authorized the establishment of a Reconstruction Finance Corporation, modeled after the War Finance Corporation of World War I, and loaned money to banks, railroads, and agricultural organizations. The RFC also extended aid to state and local governments. In 1932, it dispersed a total of $1.5 billion. By 1932 the federal government’s budget balance was seriously in deficit and President Hoover pushed the Revenue Act of 1932 through Congress. It raised individual tax rates with the top rate increasing from 25 percent to 67 percent, doubled inheritance taxes, and raised corporate income taxes by 15 percent.

In the November presidential election campaign, Governor Franklin D. Roosevelt of New York criticized the incumbent President Hoover for increasing government spending, blocking trade, and putting millions of Americans on the dole. Governor Roosevelt won the election in a landslide of 42 states to 6 and a popular vote of 57 to 40 percent over President Hoover. In the Senate elections the Democrats picked up 12 seats, and in the House elections an additional 97 seats. In the new 73rd Congress the Democrats controlled the Senate with 59-36 seats, and in the House with 313-117 seats.

Bailing Out Businesses with the RFC

content

Intention: intent	Liberal Line: lib
Outcome: outcome	Conservative Line: con

Raising Tax Rates in the Middle of a Depression

By the start of 1932 the Hoover adminstration had become very concerned about the federal government�s solvency. Federal spending had surged from $3 billion to $7 billion and the surplus of 1929 had become a $4 billion deficit. Something had to be done. The solution was the Revenue Act of 1932 that increased federal income tax across the board, with the top rate increasing from 25 percent to 63 percent. The estate tax was doubled, and corporate income tax rates were raised by 15 percent.

Intention: The increase in taxes was seen as a necessary action to staunch the hemorrhaging of the federal government�s finances.	Liberal Line: Typical President Hoover, trying to balance the budget instead of helping people.
Outcome: The expected revenue did not materialize. Government spending continued to increase and the revenues continued to collapse. Spending in fiscal year 1932 was $6.92 billion and the deficit ballooned from 0.8 percent of GDP in 1931 to 6.8 percent of GDP in 1932.	Conservative Line: Hoover�s attempt to increase revenue by increasing tax rates was bound to fail.

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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

SOURCES

The Great (Male) Stagnation
How male compensation has stalled and women's compensation has soared since the 1970s.

The 2010 Index of Dependence on Government
from the Heritage Foundation

Historical Financial Statistics - The Center for Financial Stability
the start of a site with major government stats

Flesch Kinkaid Readability Calculator
returns grade level and readability index.

Cook Partisan Voting Index
gives a quick look at the partisan rating of each congressional district.. There are currently 10 Democratic-leaning districts represented by Republicans and 71 Republican-leaning districts represented by Democrats.

Measuring Worth - GDP Series for US and UK
includes GDP and chained GDP for US; GDP and chained GDP for UK

Republicans: Still Happy Campers
Year after year, Republicans are happier than Democrats. Even in 2008

American National Election Study 2004
Berkeley's control panel

University top 200 in full
Harvard is still #1

Gross Domestic Product by State
from Bureau of Economic Analysis

> archive

Education

“We have met with families in which for weeks together, not an article of sustenance but potatoes had been used; yet for every child the hard-earned sum was provided to send them to school.”
E. G. West, Education and the State

Mutual Aid

In 1911... at least nine million of the 12 million covered by national insurance were already members of voluntary sick pay schemes. A similar proportion were also eligible for medical care.
Green, Reinventing Civil Society

Government Expenditure

The Union publishes an exact return of the amount of its taxes; I can get copies of the budgets of the four and twenty component states; but who can tell me what the citizens spend in the administration of county and township?
Alexis de Tocqueville, Democracy in America