Wednesday, July 13, 2011

America Needs You Warren G Harding

From: Gay

America needs you/Harry Truman,” sang the band Chicago in 1974.” They added later that the straight-talking Missourian knew “what to do.”‘

Over at Powerline, Steven Hayward paraphrases “Those Were the Days,” the theme song to the 1970s hit sit-com, “All in the Family,” so suggest that given Herbert Hoover’s predilection for government solutions to the Great Depression, we could instead use a man like Warren Harding again. Hoover, he reminded up, citing Dan Mitchell and others

. . . increased government spending 47 percent in his one term, raised taxes, and signed off on the disastrous Smoot-Hawley tariff, which first caused Franklin Roosevelt to run against Hoover’s profligacy, but later caused Rex Tugwell to say later that “practically the whole New Deal was extrapolated from programs that Hoover started.”

Turns out that to confront the recession he “inherited” (to borrow a word) from his predecessor, the Ohio Republican

. . . cut government spending sharply and rapidly (by almost 50 percent), began cutting tax rates across the board, and allowed asset values and wages to adjust freely as fast as possible. Harding’s administration, Paul Johnson observed, “was the last time a major industrial power treated a recession by classic laissez-fairemethods, allowing wages to fall to their natural level . . . By July 1921 it was all over and the economy was booming again.” The Cato Institute’s Jim Powell offers a more complete summary of Harding’s soundness on economic policy, but suffice it to say that Harding’s traditional approach prevented the depression of 1920-21 from becoming a Great Depression, and in fact set the stage for the roaring twenties.

Seems like the incumbent should look to the example not of FDR, but of Warren Harding if he wants to “jumpstart” the American economy.

Seem America needs a little of Warren Harding’s common sense right now. That Ohioan really knew what to do.

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