Higgs: Why Did the Great Depression Last So Long?
Robert Higgs helps us all understand in this great interview by Scott Horton at Antiwar Radio. They discuss
the relationship between the inflation of World War One, the roaring ‘20’s and the Great Depression, Fed chief Ben Strong’s deal with the Bank of England’s Montague Norman to inflate in the 1920s in order to help England and how this created the stock market bubble (and others) in the 20s, some of the ways that the near-totalitarian New Deal interventions of Wilsonian Republican Herbert Hoover and Wilsonian Democrat Franklin Roosevelt compounded and prolonged the depression, the myth that World War II ended the Great Depression, the Korean War and switch from World War to Cold War, the state’s scare tactics to strong-arm government growth, chaotic interventionism in the market and the status of the dollar as the world’s reserve currency.
This is incredibly timely, as every interventionist pundit today compares our situation to the Depression, while drawing the precisely wrong lessons. As Higgs points out, “virtually everything that was done” by Hoover and then FDR only prolonged and deepened the Depression.