The Control of Business Cycles: A Study of Methods for Achieving and Maintaining Prosperity

The Control of Business Cycles: A Study of Methods for Achieving and Maintaining Prosperity

The Control of Business Cycles: A Study of Methods for Achieving and Maintaining Prosperity

The Control of Business Cycles: A Study of Methods for Achieving and Maintaining Prosperity

Excerpt

ONE OF THE MOST SERIOUS ECONOMIC AND SOCIAL PROBLEMS IN THE United States today is the one that is described variously as the prevention of depressions, the elimination of unnecessary unemployment, the achievement and maintenance of prosperity, and the control of business cycles.

During the past ten years the sum of the incomes of the American people, at 1940 prices, has been of the order of 600 billion dollars. Had full prosperity obtained during that ten- year period, the figure would have been of the order of 800 billion dollars. In other words, ten years of depression have cost us 200 billion dollars. That amount of permanently lost output is the value equivalent of more than $1,500 for every person in the country, or $6,000 for every family of four.

In addition to this economic cost, the social cost has been enormous and may indeed be more serious than we realize. The fruits of long depression include discouragement, ill health, poverty, cynicism, and lack of confidence in system, leadership, and country.

During these years there has been a tremendous amount of discussion of and argument about recovery policies. Rather little of this discussion, however, has been comprehensive and thoughtful. Most of it has been afflicted by political considera-

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