Commerce Chairman Says FDR Didn’t Spend Enough to Get U.S. Out of Depression

January 8, 2009 - 9:27 PM
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(CNSNews.com) - Incoming House Energy and Commerce Committee Chairman Henry Waxman (D-Calif.) told CNSNews.com Tuesday that Franklin D. Roosevelt “did not spend what was needed” to get people “back to work” during the Great Depression.  
 
His comments were made following a House Steering and Policy Committee hearing about the current need for an economic stimulus package that could cost anywhere between $775 billion and $1 trillion. It is estimated that the Roosevelt administrations spent $500 billion (in inflation-adjusted dollars) to try to get America out of the 1930s Depression.
 


When asked how the spending in a stimulus package today would have a different effect than FDR’s spending on federal programs, which did not significantly lower unemployment until the start of World War II, Waxman said Roosevelt did not spend enough.

“Well, a lot of economists tell us that what Roosevelt failed to do was to spend as much money as was needed to get people back to work and get the economy moving again,” he said.

“It wasn’t until World War II when we had major expenditures that the Depression was finally resolved,” said Waxman. “We’re going to be looking at that experience. But I think what we are facing now is unique. But we’ve got to approach it with what we’ve learned from the past but think through what we need for the future.”

Despite the $500 billion spend under FDR through various programs, the unemployment rate in the United States did not significantly decrease until after the U.S. officially entered World War II in 1941.

According the Bureau of Labor Statistics, from 1929-1944, the rates of unemployment in the United States were as follows:

1929 ... 3.2%
1930 ... 8.7%
1931 ... 15.9%
1932 ... 23.6%
1933 ... 24.9%
1934 ... 21.7%
1935 ... 20.1%
1936 ... 16.9%
1937 ... 14.3%
1938 ... 19.0%
1939 ... 17.2%
1940 ... 14.6%
1941 ... 9.9%
1942 ... 4.7%
1943 ... 1.9%
1944 ... 1.2%