The Crisis of Capitalism.
Although a citizen of Great Britain, economist John Maynard Keynes had a tremendous impact on American business practices and in particular the role of the government in the economy. Keynes theorized that the Depression was not a result of overproduction, the most commonly given cause, but rather a problem of distribution. Although Keynes's ideas were initially rejected during the 1930s, in the 1940s they became widely accepted.
Priming the Pump.
Essentially, Keynes argued, the Depression was caused by a shortage of money that made it difficult to move goods from one location to another. The cure, as he saw it, was for the government to prime the economy's pump with deficit spending. An increase in government spending without accompanying tax increases would put more money in circulation and start the economy moving again. His theories were first put before President Franklin D. Roosevelt...
(The entire page is 548 words.)
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