We are paralleling almost exactly what happened during the Great Depression. Let’s not make the same mistake of 1937. Republicans seem intent on taking us there….

1933

Roosevelt inaugurated; begins “First 100 Days” of intensive legislative activity. (More)

A third banking panic occurs in March. Roosevelt declares a Bank Holiday; closes financial institutions to stop a run on banks.

Alarmed by Roosevelt’s plan to redistribute wealth from the rich to the poor, a group of millionaire businessmen, led by the Du Pont and J.P. Morgan empires, plans to overthrow Roosevelt with a military coup and install a fascist government. The businessmen try to recruit General Smedley Butler, promising him an army of 500,000, unlimited financial backing and generous media spin control. The plot is foiled when Butler reports it to Congress. (More)

Congress authorizes creation of the Agricultural Adjustment Administration, the Civilian Conservation Corps, the Farm Credit Administration, the Federal Deposit Insurance Corporation, the Federal Emergency Relief Administration, the National Recovery Administration, the Public Works Administration and the Tennessee Valley Authority. (More)

Congress passes the Emergency Banking Bill, the Glass-Steagall Act of 1933, the Farm Credit Act, the National Industrial Recovery Act and the Truth-in-Securities Act. (More)

U.S. goes off the gold standard.

Roosevelt does much to redistribute wealth from the rich to the poor, but is obsessed with a balanced budget. He later rejects Keynes’ advice to begin heavy deficit spending.

The free fall of the GNP is significantly slowed; it dips only 2.1 percent this year. Unemployment rises slightly, to 24.9 percent.

1934

Congress authorizes creation of the Federal Communications Commission, the National Mediation Board and the Securities and Exchange Commission. (More)

Congress passes the Securities and Exchange Act and the Trade Agreement Act. (More)

The economy turns around: GNP rises 7.7 percent, and unemployment falls to 21.7 percent. A long road to recovery begins.

Sweden becomes the first nation to recover fully from the Great Depression. It has followed a policy of Keynesian deficit spending. (More)

1935

The Supreme Court declares the National Recovery Administration to be unconstitutional.

Congress authorizes creation of the Works Progress Administration, the National Labor Relations Board and the Rural Electrification Administration. (More)

Congress passes the Banking Act of 1935, the Emergency Relief Appropriation Act, the National Labor Relations Act, and the Social Security Act. (More)

Economic recovery continues: the GNP grows another 8.1 percent, and unemployment falls to 20.1 percent.

1936

The Supreme Court declares part of the Agricultural Adjustment Act to be unconstitutional.

In response, Congress passes the Soil Conservation and Domestic Allotment Act. (More)

Top tax rate raised to 79 percent.

Economic recovery continues: GNP grows a record 14.1 percent; unemployment falls to 16.9 percent.

Germany becomes the second nation to recover fully from the Great Depression, through heavy deficit spending in preparation for war.

1937

The Supreme Court declares the National Labor Relations Board to be unconstitutional.

Roosevelt seeks to enlarge and therefore liberalize the Supreme Court. This attempt not only fails, but outrages the public.

Economists attribute economic growth so far to heavy government spending that is somewhat deficit. Roosevelt, however, fears an unbalanced budget and cuts spending for 1937. That summer, the nation plunges into another recession. Despite this, the yearly GNP rises 5.0 percent, and unemployment falls to 14.3 percent.

1938

Congress passes the Agricultural Adjustment Act of 1938 and the Fair Labor Standards Act. (More)

No major New Deal legislation is passed after this date, due to Roosevelt’s weakened political power.

The year-long recession makes itself felt: the GNP falls 4.5 percent, and unemployment rises to 19.0 percent.

Britain becomes the third nation to recover as it begins deficit spending in preparation for war.

1939

GNP rises 7.9 percent; unemployment falls to 17.2 percent.

The United States will begin emerging from the Depression as it borrows and spends $1 billion to build its armed forces. From 1939 to 1941, when the Japanese attack Pearl Harbor, U.S. manufacturing will have shot up a phenomenal 50 percent!

The Depression is ending worldwide as nations prepare for the coming hostilities.

World War II starts with Hitler’s invasion of Poland.

1945

Although the war is the largest tragedy in human history, the United States emerges as the world’s only economic superpower. Deficit spending has resulted in a national debt 123 percent the size of the GDP. By contrast, in 1994, the $4.7 trillion national debt will be only 70 percent of the GDP!

The top tax rate is 91 percent. It will stay at least 88 percent until 1963, when it is lowered to 70 percent. During this time, America will experience the greatest economic boom it has ever known.