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H.W. van Loon – Commentary: Relief – NBC Red Network – May 23, 1937 – Gordon Skene Sound Collection –
America in the midst of the Great Depression – still trying to recover, some 8 years after the initial Stock Market crash. Still going through fits and starts on what was a very long road to recovery. In 1937 we were in the midst of a recession, as if things were bad enough.
In most countries of the world, recovery from the Great Depression began in 1933. In the U.S., recovery began in early 1933, but the U.S. did not return to 1929 GNP for over a decade and still had an unemployment rate of about 15% in 1940, albeit down from the high of 25% in 1933.
There is no consensus among economists regarding the motive force for the U.S. economic expansion that continued through most of the Roosevelt years (and the 1937 recession that interrupted it). The common view among most economists is that Roosevelt’s New Deal policies either caused or accelerated the recovery, although his policies were never aggressive enough to bring the economy completely out of recession. Some economists have also called attention to the positive effects from expectations of reflation and rising nominal interest rates that Roosevelt’s words and actions portended. It was the rollback of those same reflationary policies that led to the interruption of a recession beginning in late 1937. One contributing policy that reversed reflation was the Banking Act of 1935, which effectively raised reserve requirements, causing a monetary contraction that helped to thwart the recovery. GDP returned to its upward trend in 1938.
According to Christina Romer, the money supply growth caused by huge international gold inflows was a crucial source of the recovery of the United States economy, and that the economy showed little sign of self-correction. The gold inflows were partly due to devaluation of the U.S. dollar and partly due to deterioration of the political situation in Europe. In their book, A Monetary History of the United States, Milton Friedman and Anna J. Schwartz also attributed the recovery to monetary factors, and contended that it was much slowed by poor management of money by the Federal Reserve System. Former Chairman of the Federal Reserve Ben Bernanke agreed that monetary factors played important roles both in the worldwide economic decline and eventual recovery. Bernanke also saw a strong role for institutional factors, particularly the rebuilding and restructuring of the financial system, and pointed out that the Depression should be examined in an international perspective.
As one of the many commentators during this period of Radio History, Hendrik Willem van Loon, was a Dutch-American Historian and Journalist, who had a weekly program where he gave an assessment of the then-current state of affairs, among them the issue of Relief which was a very high priority on most Americans agenda at the time.
To give you an idea that financial uncertainties and pandemics aren’t new to our culture, here is a reminder via H.W. van Loon as broadcast on May 23, 1937 – the topic of his commentary: Relief.
