In the June 26 issue of The Chronicle Review, Brown University history professor Elliott Gorn contributes an article entitled “The Meanings of Depression-Era Culture.” (Subscriber site.) What caught my eye was the typical leftist jab that a recession became the Great Depression because Hoover and the Republicans in Congress sat around and did nothing in obedience to their laissez-faire beliefs.

It’s important for the Left that people keep believing that myth. If most Americans came to understand that government economic intervention is the cause of recessions and its blundering efforts at ameliorating them are counter-productive, support for the status quo would plummet.

I just sent this letter to the editor:

In his article “The Meanings of Depression-Era Culture,” Elliott Gorn can’t resist wading into economic policy and taking the usual shot at Herbert Hoover: “After the stock market crash that ended the 1920s, the economy had more than three years to stagnate, as President Herbert Hoover and Congress did what Republicans now recommend: not much.”
I know that this notion fits perfectly with the anti-capitalist narrative the left finds so useful, but it’s flatly untrue. Herbert Hoover was a whirling dervish of economic interventionism, with a host of policies that substituted politics for free market adjustments in wages, prices and production. If he’s interested in the truth about Hoover, I suggest starting with Murray Rothbard’s book America’s Great Depression.
Recessions and depressions don’t just happen. They’re caused by government cheap money policies that distort investment and production. The Federal Reserve’s inflation in the late 1920s led to a boom in which some industries over-expanded. Hoover tried frantically to prevent the necessary economic adjustments, and everything he did just made matters worse.
I’m not siding with the Republicans, who have been just as culpable as the Democrats in giving us a leviathan state that has vastly more power than any government should have. The sooner Americans of all parties and persuasions give up the myth that free markets cause depressions and government has to cure them, the better off we’ll be.
George C. Leef
Director of Research
Pope Center for Higher Education Policy
Raleigh, NC