Economics and the public welfare : a financial and economic history of the United States, 1914-1946

In the turbulent years between passage of the Federal Reserve Act (1913) and the Bretton Woods Agreement (1945), the peoples of the Western world suffered two World Wars, two major and several minor international financial panics, an epidemic of currency devaluations and debt repudiations, civil wars, and revolutions. They also enjoyed a decade of unprecedented prosperity and a decade of unprecedented depression and deflation. They also saw the beginning of a period of prolonged, world-wide inflation. No period in history could serve better as a case study for the analysis of applied economic policy. From his vantage point as economist for the Chase Manhattan Bank and editor of the Chase Economic Bulletin, who participated in much of what he records, Dr. Anderson here describes the climactic events of a turbulent era. **Arthur Kemp** is Professor Emeritus of Economics at Claremont McKenna College. Title page 1 Foreword by Henry Hazlitt 3 Preface 8 Contents 11 Part I World War I 15 The Prewar World, 1913 17 The Outbreak of the War in 1914 22 The War Prosperity 35 Our War Economic Policy 43 The Federal Reserve System, 1914-1918 55 Part II The Postwar Boom, Crisis, and Revival 59 The Postwar Bom, 1919-1920 61 The Causes of the Crisis of 1920 70 The Crisis - 1920-1921 80 The Rapid Revival - August, 1921, to March, 1923 91 The Government's contribution to the Revival, 1921-1923 93 The Money Market, 1920-23, Renewed Bank Expansion 96 Our Foreign Policy, 1919-1924 101 Germany, 1918-1924 107 Frank, 1918-1924 113 The Dawes Plan 116 Part III The First Phase of the New Deal 125 Depression and Rally of 1924 - the Beginning of the New Deal 127 Money, Bank Credit, and Capital 133 The Extent of Bank Expansion 147 The Causes of and the Responsibility for the Excess Reserves 155 Germany 162 France 168 Great Britain 176 The De Facto Stabilization of the Franc 182 The Consequences of the Cheap Money Policy 188 The Confernce of Governors 194 The Stock Market Boom 198 Mob Mind in 1928-29 210 The Effect on Europe of Tight Money 212 The New Era 216 The Stock Market Crash of 1929 223 The New Deal in 1929-30 233 Late 1930 241 The Tragic Year - 1931 245 1931 Continued 258 1931 Continue 270 1932 282 The Upturn in the Summer of 1932 287 The Impact of Politics on the 1932 Revival 291 The Banking Holiday 299 The Intergovernmental Debts 305 Part IV The New Deal in Maturity 313 My Father Also Chastised You 315 The Reopening of the Banks 322 The Mortality Among Small Banks 324 Branch Banking 326 Roosevelt's Abandonmnet of the Gold Standard 330 The Banking Act of 1933 335 Contradictory Policies 340 The National Industrial Recovery Act 341 The London Economic Conference 344 The Strong Business Rally 347 More Money Magic 355 The Gold Reserve Act of 1934 362 The Spending Programme 367 The Silver Legislation 372 Governmental Confusion 376 Supreme Court Decision 378 First Successful Resistance to New Deal 380 Taxation Under the New Deal 384 The Undistributed Profits Tax 392 Digression on Keynesy 404 Gold, Excess Reserves, and Money Rates 422 Gold Remains Standard of Value 428 The British Equalization Account 431 The Tyranny of Gold 435 Governmental Coercion 440 The Business Rally of 1935-37 446 The Causes of the Crisis 453 The Stock Market Crash of 1937 461 A Verdict on the S.E.C. 472 The Severe Depression 481 The Turn in the Political Tide 484 International Political Relations 488 The Effect of Governmental Economic Planning 501 Alternative Explanations 509 Part V World War II 527 The Outbreak of World War II 529 Our War Economic Policy 533 War Taxation and Expenditures 544 Governmental Borrowing in World War II 555 Price Fixing in World War II 574 Government versus Private Financing 579 Lend-Lease, Bretton Woods, and the British loan 587 Index 609

In the turbulent years between passage of the Federal Reserve Act (1913) and the Bretton Woods Agreement (1945), the peoples of the Western world suffered two World Wars, two major and several minor international financial panics, an epidemic of currency devaluations and debt repudiations, civil wars, and revolutions. They also enjoyed a decade of unprecedented prosperity and a decade of unprecedented depression and deflation. They also saw the beginning of a period of prolonged, world-wide inflation.

No period in history could serve better as a case study for the analysis of applied economic policy. From his vantage point as economist for the Chase Manhattan Bank and editor of the Chase Economic Bulletin, who participated in much of what he records, Dr. Anderson here describes the climactic events of a turbulent era.