A reply I wrote on a blog today. I don’t think that there is any individual statement that makes me madder than “WW2 ended the great depression”.
http://www.capitalgainsandgames.com/blog/bruce-bartlett/1221/what-links-great-depression-and-great-recession
“there was enormous fear that the Great Depression would simply start up again where it left off after the temporary prosperity of World War II ended with the war.”
“Economists today generally believe that it was the unprecedented deficits resulting from World War II that actually ended the Great Depression.”
I simply cannot fathom the way that this myth has continued exist among economists, perhaps its a desire to elevate WW2 to loftier standards or the desire to have a definitive answer to solving the great depression, but it is a repulsive lie.
You used the word “prosperity”- but there was no prosperity for people during WW2- did people have more and better food, clothing and durable goods? No, shortages were persistent throughout the war- so much so that the lack of consumption during the war is used as an excuse by Keynesians for the lack of a deep depression that they predicted after the end of government spending. They call it “pent up demand”.
Over 400,000 US soldiers died during the war, nearly 700,000 more were wounded- and you use the word “prosperity”? This is a shameful facet of economics where researchers tag meaning to numbers like GDP and forget why the concept of GDP was useful in the first place. Rising GDP is supposed to mean more goods, more services- a bigger pie for all, not simply an accounting identity where by we can spew out tanks and trucks and corpses of men and slap a number to them and proclaim “growth” and “prosperity”.
