Spending And The Great Depression or ‘No, World War 2 Didn’t End The Depression’

[Donnachaidh]

http://www.addictinginfo.org/2011/09/19/no-world-war-2-didnt-end-the-depression-spending-and-the-great-depression/

There’s a common myth out there that goes, “the Great Depression was finally ended by World War 2“. It has some slight variations, such as “the Great Depression lasted 15 years” or even “the market didn’t recover until govt spending stopped“.



All of these are complete misunderstandings of history if not outright lies.

While there may not be as accepted a definition for depression as for recession, there’s a good bit of consensus along the lines of these two criteria for an economic depression:

1. real GDP decline beyond 10%
2. period of decline lasting more than three years

More at the link --

[MannyGoldstein]

1. Thanks. People are always misunderstanding this.

GDP grew at something like 9% per year in FDR's first term.

[johnaries]

2. Even if one accepted that WW2 ended the Depression, it was

government spending during the war that drove the economy. True, it was already making a comeback, but I never understood this argument since it actually proves the opposite of what the RW says about government spending.