THE GREAT DENIAL

Ronald Regan famously taught us that "gov-
ernment is the problem." He had it half
right: bad government is the problem, as we
have learned, to our grief, over the past eight
years! In the '30s we saw good government
build dams and bridges and put millions of
idle people to work on roads, woods, building,
and conservation.

Yes, I know: ignorant potato heads on TV are
parroting the old Republican mantra that F. D. R.'s
reforms "didn't work." They cite (correctly) the
fact that we didn't fully recover from the Great
Depression until WW II. 80% recovery doesn't
count for anything! It's all or nothing for those
clowns. And yes, they really are funny, arguing
this nonsense in the hallowed halls of congress!
Lying by omission, they leave out some impor-
tant facts: unemployment went from 25% of the
work force in 1933 (FDR's first year in office) to
13% in 1936. That's a huge improvement! In
1937 FDR listened to the budget hawks who
were alarmed by the deficit, and cut back on his
spending. It caused a recession. A short one.
He gave it full throttle again in '38 and we re-
sumed growth right away.

If you'll Google "the great depression," you'll
learn that while GNP fell a record 13.4% in 1932,
it grew by more than 8% in 1934, and kept im-
proving steadily from then on, except for 1937.
By 1936 national GDP exceeded the level in 1929
(the height of the boom) and went on up from
there. By the time of Pearl Harbor it was up 90%
from 1933. Don't tell me government programs
weren't working! That's hogwash.

Now we are hearing that government stimulus
of the economy "won't work" because it didn't
work for FDR! In other words, because his pro-
grams only cut unemployment in half, they were
worthless. Wouldn't be nice if we could cut un-
employment from, say 9%, to 4.5%? Wouldn't
that be good? In the first full year that FDR's
program kicked in (1934) the economy grew by
8% (according to Paul Krugman). If we could do
4%, wouldn't that be a great help? Because we
can't do everything is not an argument for doing
nothing! More tax cuts for the rich are worse
than nothing. They add to the deficit without
helping the economy. No reputable economist
says differently.

Our new treasury secretary says "governments
are terrible managers of bad assets." Well duh,
who isn't? Can you tell me who is a good mana-
ger of "bad assets"?

The new secretary, who is supposed to be a
genius (and I wish him well), said: "there's no
good history of governments doing that well."
Really? Is there "good history (or bad)" of any-
one else doing it better? How about the guys in
charge now: the ones who ran the train off the
track on a trestle. Should they still be in charge?
There is no history -- good or bad -- of anyone
managing "bad assets" well. It can't be done.
You pay 'em off, write 'em off, flush them or
whatever, and go on. And that's what we need
to do with the old mythology about FDR, market
infallibility, supply side economics, and the magic
of tax cuts. That false religion is what got us here!

jgoodwin004@centurytel.net