During the Great Depression, why did Roosevelt choose to make the State take care of the problem? Why didn't he let the market fix itself?Why did he choose the keynesitic way - John Keynes method...
During the Great Depression, why did Roosevelt choose to make the State take care of the problem? Why didn't he let the market fix itself?
Why did he choose the keynesitic way - John Keynes method - to let the state fix the problems, why didn't they just let the marked fix it?
Herbert Hoover, the president who proceeded Roosevelt, had tried to let the markets right themselves. But that strategy had not worked. In 1929 and 1930, there were very few programs for people who had lost their jobs. There was no unemployment insurance and men were standing on the street, begging for work while their children literally starved. Hoover's plan to let the market right itself and for the money to then trickle down to the rest of the people, was causing untold misery. It was also causing civil unrest. So, Roosevelt turned to the only institution that had enough resources to help get people off the bread lines and into jobs. Not everything he tried worked, but the idea was to try anything that might work. At least people felt like something was being done and that lead to hope. The markets did finally improve, ironically, because of the war in Europe and the expanding of factories to make supplies for the war. But, in the meantime, the social programs kept many from starving and turning to social unrest as a way to solve the problems.
There was no market to speak of. The state created programs that not only solved the problems that the nation was facing in terms of production, but also pumped lifeblood through the economy, since people could now work for wages, and spend those wages on rebuilding their lives.