The New Deal Worsened the Great Depression

Defending My ArgumentsMy opponent did not respond to my central claim that Regime Uncertainty was a major factor in the length of the Great Depression. This seems to be because he mistakenly attributes the Regime Uncertainty argument the UCLA paper I cited. In fact, the Regime Uncertainty argument was put forward by Robert Higgs, an Austrian Economist. I offered evidence from his research on this effect in my last round. Regime Uncertainty was my central argument that the New Deal extended the Great Depresssion. My opponent did not respond to any of the arguments. Which is too bad, because this is the last round of arguments/rebuttals. The UCLA study did not look at Regime Uncertainty, it looked at the high wages policy of Roosevelt. My opponent says: "There are many sources that show that the NIRA was not responsible for all of the wage increases in the 1930’s. ". Thisis true. .. and the UCLA study looks at this. They actually point out that the post-NIRA union legislation continued the high wage policy that held back job creation. Other than this, my opponent claims that other studies disagree with the UCLA study, this is true. However, he does not explain why these studies are superior to the UCLA study, making this point irrelevant. My opponent also disagrees with my assertion that economies tend to grow faster when recovering from a crisis. In particular, he says that banking crisis's lead to slower recovery growth. This is not true. First, economies do grow faster during recoveries. .. This is a well known phenomenon. After all, it is easier to get back where you already have been than it is to go somewhere you have never been before. As far as banking crisis go, one only needs to look at the banking-based depression in 1893. From 1892 to 1894, Real GDP fell by 5.62% per year. However, from 1894 to 1895, Real GDP grew by a rapid 11.43%. This was a banking crisis, and the recovery was rapid as it was from other types of recessions/depressions. This brings me to my opponents point about high growth during the New Deal. The fact is that, as Lee Ohanian notes, we have every reason to believe that, absent the New Deal, we would have had even better growth. We had a crash like we had never seen before, and we would expect a recovery like we had never seen before. I'm not arguing that the New Deal was all negative. But, on aggregate, it did more harm than good. The New Deal created great uncertainty and artificially high wages. This slowed down recovery. Rebutting My Opponent's ArgumentsThere are far more than a "select few" studies showing a negative effect from the New Deal. And, my opponent asks this question:" Furthermore, just saying that businesses, after suffering the worst economic collapse in history, would just start hiring again, is just utterly ridiculous. "What I think is utterly ridiculous is expecting investors and businesses to make long term decisions in an environment as uncertain as the one Roosevelt Created. Another note is that businesses have always started hiring again after even the most severe crisis's in history. .. without any government intervention. .. As far as monetary policy goes, even Milton Friedman agrees that Monetary Policy was good during the New Deal, I wanted to debate about the controversial parts. .. My opponent also gives a random survey of the literature and finds "After reviewing all the evidence I can collect, it is reasonable to say that the New Deal helped the great depression recover. " Of course, there is no explanation for why this would be. .. Although it is not part of this debate, my opponent repeated the oft repeated claim that Hoover was a believer in laizzes faire. Anyone who knows basic history knows this is incorrect. Roosevelt actually accused Hoover of being a Socialist. Saying Hoover was a believer in free markets is simply being intellectually dishonest. ConclusionI conclude by reminding my opponent that there will be no more debating after this round. I will ask that my opponent writes a quick something (perhaps a VOTE CON) to speed along the voting proccess. I also will say that my opponent did not address my central point that Regime Uncertainty led to a slow recovery. .. And, my opponent did not offer any theoretical, or strong empirical support for his position. He simply pointed out that some economic indicators improved during the New Deal, causation was not established. I also think that, given that Con forfeited RD3, conduct must go to me. .. . This is not to be rude, but just as a point. VOTE PRO! !! Sources:. http://www.measuringworth.com...