November 7th, 2008
|11:45 pm - For those who chant the mantra of "Change!"|
One should always remember that those who want change should be careful what they wish for.
There is such a thing as "from the frying pan into the fire."
And never forget Herbert Hoover was elected in a landslide -- and we all know how his presidency turned out . . .
Current Mood: cynical
Current Music: "A Question Of Time" by Depeche Mode
Wasn't Hoover a republican?
Didn't he freeze spending (which is what McCain wanted to do?) which caused depression?
Yes he was, but the Democrats tried to snag him as their presidential candidate in 1920 (which he refused) and he was also associated with Teddy Roosevelt's Bull Moose party.
The causes of the Great Depression were many and he didn't freeze spending -- his economic philosophy was that the federal government shouldn't be doing the handouts to people, the state and local governments should, since he didn't want to create what we now refer to as a welfare state, where government handouts acted as a disincentive for Americans to find work in the private sector. He also pushed economic relief based on private and business funding of relief efforts and created federal building projects such as the Hoover Dam.
One of the problems from that era which is being revisited now is the credit crunch -- there was a huge liquidity problem where banks weren't lending to one another, just as has been happening recently. Hoover injected government money into the financial sector after the National Credit Corporation failed to work by creating the Reconstruction Finance Corporation, which gave $2 billion in aid to state and local governments and made loans to banks, railroads, farm mortgage associations, and other businesses. Then, as now, the funds the banks received were not put to their intended use of "oiling the gears" of business and the economy by being disbursed in loans to companies and individuals, and the organization had to be overhauled in order to cut down the rate of bank failures and the decrease in the money supply.
McCain didn't want to freeze spending either -- he simply didn't want to be throwing money at the current problems without looking into seeing that results were occurring. The money that banks have been receiving in the current bailout hasn't been being used appropriately, to make loans so that day-to-day commerce can resume in something closer to a normal fashion.