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Greg Krehbiel

Where have you gone, Warren Harding?

by Greg Krehbiel on 22 January 2012

In the post below about strict constructionism, John asks if any relatively recent president has declined to go along with a power grab. Misremembering something I had heard a little while ago, I thought maybe Hoover, but I had it completely wrong.

It was Harding who responded to the depression in a way that modern Tea Party people would like.

See Mister we could use a man like Warren Harding again.

The other president I’ve heard praised recently (by conservatives) is Calvin Coolidge.

I don’t know much about any of those early 20th century presidents, except for bits and pieces I’ve heard here and there. (E.g., just the other night I heard an interesting segment on some book by Hoover that he wrote towards the end of his life, mostly criticizing the policies of Roosevelt. It sounded very interesting.)

2012-01-22  »  Greg Krehbiel

Talkback

1. John K
   22 January 2012 @ 11:03 am

   And as I said there, the run-up to the Great Depression was very much like the run-up to the current mess.

   “With one brief exception, the federal government has been in debt every year since 1776. In January 1835, for the first and only time in U.S. history, the public debt was retired, and a budget surplus was maintained for the next two years in order to accumulate what Treasury Secretary Levi Woodbury called “a fund to meet future deficits.” In 1837 the economy collapsed into a deep depression that drove the budget into deficit, and the federal government has been in debt ever since. Since 1776 there have been exactly seven periods of substantial budget surpluses and significant reduction of the debt. From 1817 to 1821 the national debt fell by 29 percent; from 1823 to 1836 it was eliminated (Jackson’s efforts); from 1852 to 1857 it fell by 59 percent, from 1867 to 1873 by 27 percent, from 1880 to 1893 by more than 50 percent, and from 1920 to 1930 by about a third. Of course, the last time we ran a budget surplus was during the Clinton years. I do not know any household that has been able to run budget deficits for approximately 190 out of the past 230-odd years, and to accumulate debt virtually nonstop since 1837.

   The United States has also experienced six periods of depression. The depressions began in 1819, 1837, 1857, 1873, 1893, and 1929. (Do you see any pattern? Take a look at the dates listed above.) With the exception of the Clinton surpluses, every significant reduction of the outstanding debt has been followed by a depression, and every depression has been preceded by significant debt reduction. The Clinton surplus was followed by the Bush recession, a speculative euphoria, and then the collapse in which we now find ourselves. The jury is still out on whether we might manage to work this up to yet another great depression.

   (The quoted part is way down near the bottom of a very dense discussion of monetary theory)

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