A useful very short course on myths of the great depression and parallels between the 1930s and today. Check out these excerpts:
I keep coming across parallels between the 1930's and the present day. An impassioned pacifism swept the western intelligentsia. In England in February of 1933, the Oxford Union passed a resolution declaring that "this House will in no circumstances fight for its King and Country." Similar petitions were popular on elite college campuses in the United States. Meanwhile, of course, 1933 was the year that Adolf Hitler consolidated his power in Germany.
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What I had not realized until I read Alexander Field's article is that the Great Depression was also an era of high productivity growth. Field argues that the 1930's were also a period in which technological innovations were being exploited to increase productive efficiency.
The Depression certainly was an era of displacement. In fact I have borrowed the very term "displacement" from the late economic historian Charles Kindleberger, author of Manias, Panics, and Crashes and one of the eminent economists interviewed by Parker. Kindleberger's theory of manias, such as the Tulip Mania, the South Sea Bubble, or the Internet craze, is that they are triggered by a major change in the economic or geopolitical environment. The change creates new opportunities and sudden wealth, leading to greed and overspeculation. Kindleberger views the 1929 stock market boom and subsequent crash as a classic example of this theory. The geopolitical realignment following World War I, and the rapid growth of industries in automobiles and electronic communications, created displacement.
The development of motorized transportation must have affected every sector of the economy in the second quarter of this century. It permitted efficient farms located away from population centers to replace inefficient farms located close to cities and towns. It allowed people to enjoy the comfort and relative low cost of living in the suburbs while continuing to work in central cities. It allowed factories to relocate out of expensive central cities and into outlying areas and smaller towns.
Until World War II, however, the labor released by the progress of the 1930's was unemployed. The war brought full employment. After the war, to the surprise of most economists, the economy did not sink back into another recession. Instead, overall demand was high enough to absorb the nation's work force.
Overall: Optimism that we're pulling out of it and at least not repeating the fairly massive mistakes of the 30's like the "National Recovery Administration".
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