YouSaid · the spoken record

George Selgin

lines on the record: 79
first: 2025-10-15
most recent: 2025-10-15
sittings or episodes: 1
sources: podcast

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“And he didn't mince words about it. The only other thing, the other important thing that Keynes recommended was that Roosevelt spend more. And that's where the conservatives and the libertarians would have a beef with him. But if Roosevelt had spent a lot more, whatever you think about fiscal stimulus, right, if he'd done that instead of the things he and the other New Dealers actually did, there's no doubt in my mind that it would have been better because pouring more money in the economy may have adverse consequences, but nothing like some of the scary reforms and highly regressive taxes and price controls and that sort of thing had.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“That the New Deal was confusing or getting priorities wrong about reform versus recovery. He said, look, maybe some of these reforms that you're implementing will have good long-run results, but this is not the time. You should be concentrating on recovery, partly because reform shook up businessmen and made it, again, hard for them to regain their confidence. The whole discussion of animal spirits, by the way, is all about what we now more often call regime uncertainty. Finally, Keynes attacked very strenuously some of the worst New Deal policies, the gold purchase program. He ridiculed and said this was just a very bad idea and he was right. And also the NRA, she was extremely critical of the National Recovery Administration and its price controls.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, to some considerable extent, I honestly not just to be provocative will say that the things Keynes had to say to Roosevelt directly, sometimes through letters publicly published, and also in his meeting with Roosevelt insofar as we know about it, his one meeting, Keynes' advice on how the US should deal with the depression and try to get out was very sound. I'll give you a few examples. He was very concerned about uncertainty, regime uncertainty, and specifically with Roosevelt's tendency to attack businessmen and even pursue policies that were directly aimed at punishing them. And he told him more or less not in so many words, but that he ought to back off. This was not the time. Similarly, he said,”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Recovery is just about around the corner, that they're almost there. Because by 37, things are starting to look a lot better. So they, in one of Benny efforts to balance the budget during this time, they resorted to fiscal retrenchment. So you had a tightening of fiscal policy. I think the best answer to the question, how come you had such a severe decline is that you had this conjunction of monetary and fiscal tightening all happening at the same time.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“requirements. They did it in three steps, and that in itself may not have done that much harm, there's controversy about how much it mattered, but at the same time at the Treasury they started sterilizing the gold inflows, that is, they took steps that prevented the inflow of gold which went directly to the treasury at this time from influencing the amount of reserves in the banking system. So the reserves didn't go up even though the treasury was getting more gold. And it was exactly coincident with all this monetary restraint that you had the outbreak of the 37, 38 depression. But that's not all. There was fiscal constraint as well coming up towards 37, they decided that along with thinking that inflation was a potential becoming a threat all of a sudden, they're thinking as well that the”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“That's a really good question, and now you've come to the first one that kind of stumps me because it was so dramatic. It's so sudden. There were a bunch of factors that contributed to it. And I think that the best answer to the question is that there were so many operative causes all coming together at once, a sort of perfect storm of bad policies. On the monetary policy side, two things were done at the same time by different actors who didn't seem to be coordinating very well. First, remember that gold flowing in from Europe that was the main driving factor in expanding demand in the 30s, well, they started worrying about inflation. Oh, we're going to have too much, which was kind of crazy under the circumstances, but it's true. And as a result, at the Fed, they started doubling.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“If the answer to that question depends on having a rough idea about what policies are going to be in the future and you don't have even that, you're going to hold back. And I think that bearing in mind now, the big problem with recovery was not about consumption. That's relatively easy to get going. It was about investment spending, which had totally collapsed. There was hardly any net investment for the whole nineteen thirties. Anything that is discouraging Businessman from investing, including uncertainty which can definitely do it, is going to be standing in the way of recovery, and I believe this was a big barrier to recovery during the 30s.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, I think that a policy that certain can have a small effect for obvious reasons that it might not be a policy that has all that many consequences that are predictable. In other words, Doug Irwin before Smoot Hawley was passed knowing what's going on might have said, yes, this is going to have small consequences. If we assume, and this is a stretch, that people are as smart as Doug Irwin, they would have might have anticipated the policy and still not expected it to have big effects. Regime uncertainty is a whole different matter because the problem there is not that you anticipate a policy and anticipate its consequences, but that you just don't know what the heck's coming. Now, from investment, from the point of view of investors, that's a huge thing, because the first thing investors want to know is whether they're going to reap the benefits of their investments.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, on Smoot Holly, my tendency is to defer to the research of Doug Irwin, who I consider to be the great expert on this subject. And Doug is by no means a critic, let alone an opponent of free trade, who's very critical of Smooth Hawley, yet even Doug says that his opinion is that Smooth Hawley was a small factor in the Great Depression. If he says that, I'm inclined to agree, though I have to say I haven't done any independent research on this. It's just simply a matter of my inclination to defer to that particular authority on this question.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Monetary policy than on fiscal and resorted to fiscal stimulus to the extent that monetary policy didn't seem to be able to cut it.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“I would have gotten rid of some of the more regressive taxes which they were relying on heavily, starting with the nineteen thirty two excise taxes that were passed by the Hoover administration, but they were maintained and even expanded by the Roosevelt administration. Roosevelt had some taxes that were meant to soak the rich. They get a lot of attention, but they were in fact not the main sources of revenue by any means. Most of the taxes that the administration was relying on in its effort to balance the budget, which it kept trying to do, this is the Roosevelt administration. Most of them were quite regressive, falling on lower income people. And I would certainly have rolled back some of those taxes. I don't think fiscal deficits were at all inappropriate at this time. But again, I would have placed more emphasis on”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Fiscal policy given the difficulty involved of spending a lot of money and the potential waste that fiscal policy, fiscal stimulus can involve.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“I would have spent more. On deficits. Well, that's the challenge with fiscal policy back then. Today, they don't seem to be short of ideas for spending money somehow. In those days, they were short of ideas. In fact, Roosevelt was a fiscal conservative throughout his years. Roosevelt at first said regard to big spending plans, what are you going to spend it all on? And he had a point. I would have favored more fiscal stimulus to the extent that they could come up with stuff to spend it on, and I might have told IX to spend money a little bit more generously and not be worried about wasting it. But I want to say I would have put more emphasis on monetary policy, which wasn't taken advantage of, because I think it would have been much more capable of addressing the problem of a lack of demand than”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Under Ekel's watch. If you look at Federal Reserve, credit, including open market purchases, it's a flat line. And so, yes, now Washington's in charge. Yes, you don't have to worry about getting these 12 banks to cooperate, which is like hurting cats, but no effort was made to take advantage of that, to pursue an expansionary monetary policy.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, the Federal Reserve was Banking Act of 1935 gave the Federal Reserve its concentrated control of the Federal Reserve to bureaucrats in Washington. And so the good news, if you want to call it that, with that act was that now FDR, the New Dealer, could exert a lot more influence over monetary policy. The bad news is they didn't take any advantage of that. Mariner Eccles was appointed as we now call him chair of the Fed, and I think that's when they first became known as the chair rather than the governor. But he was a monetary conservative in the sense he didn't believe in monetary stimulus. He was a big fiscal stimulus guy, but he's now in charge of the Fed. There was no Federal Reserve active fiscal stimulus.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“I'm going to say good in the sense that apart from long run consequences, moral hazard and all that, it did not hurt. So I'm going to say good, but it didn't help that much because there were other factors that played a much bigger role in getting people to put their money back in the banks or keep it there. So we could talk about those. The Pause insurance was much less important than other things.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“On the banks. And so it contributed to the reopening of the banking system, which was crucial to recovery, but not as much as people think.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Yeah, that's tricky because that's another one. There are several components to the banking act. And the most well-known is deposit insurance. It's probably the only one worth talking about. And the role of deposit insurance in the recovery is misunderstood in a lot of ways. One thing that's misunderstood is Roosevelt's part in it because he actually opposed deposit insurance, that component of the banking act until the 11th hour. And he only finally gave in because he could see that any, he'd either have to scrap the whole bill, and if he did try to do that with a veto, he'd probably have the veto overridden. So he finally signed it, and then he took credit. This is my idea and all that. So that's one thing that's misunderstood. The other is that deposit insurance was only one of many factors that helped stabilize the banking system by discouraging people from running.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Which just wasn't effective enough to matter. And then you had this adverse supply effect, which was important, but wasn't doing something desirable. So the studies of the AAA's effect on recovery overall don't show any, it's quite controversial whether it had a small effect or none at all. I think it probably had none.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Because the theory behind it, first of all, wasn't very sound, the idea was that we're going to tax food processors and do that to raise the income of farmers, of really farm owners, and that the farm owners will have a higher, I'm now using language. It wasn't current at the time, but we'll have a higher marginal propensity to consume than the people being taxed. And therefore, there'll be more spending overall. It was a rather doubtful theory to begin with. And of course, what these farmers were being paid to do was to produce less output, to farm fewer crops, and to destroy crops and livestock. with the aim of raising their prices through supply reduction and not just by getting aggregate demand to grow. So you had this feeble aggregate demand component.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“A bad idea, so we're capitalizing the banks was different from lending to them. And that was a later program. And that worked, I think that helped That was when the RFC actually bought shares in the banks and so raised their capital directly that way instead of lending to them. And I think that the recapitalization program was one of the good things, one of the only things about that the RFC did that helped end the Great Depression by stabilizing the banking system and allowing more banks to reopen. So I would rate that a successful program, but with the qualifier that the RFC did many things and grew into a vast agency, the biggest agency of the New Deal, as such it had more failures than successes.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Mostly it Well, it started out as Hoover's plan, and the basic idea was that it was going to lend to banks and help them become or stay solvent. But at first, the banks were very reluctant. Well, I should step back a bit. At first, the amount of lending that went on under the program was very limited. And then at a certain point, Congress made the RFC divulge, who it was lending, which banks it was lending to ahead of making loans. And then the banks became very reluctant to take part in the program.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Well, that act has two definitions. It can refer to the whole legislation which had several components. It can also refer just to the more famous part that separated investment from commercial banking. That's what people think about these days when they think about Glass-Steagall. So I'll answer the question for that second. Meaning of Glass-Teagal? And the answer is it was totally irrelevant for recovery because the involvement of commercial banks in investment banking was not a factor that contributed to the depression. So ending it wasn't going to help end the depression.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“On a hairbrain theory by a fellow named George Warren, who was very influential, and they toyed with the price of gold. The theory was that if you raise the price of gold, other prices will start going up. Didn't happen. Eventually, after many months, general prices had hardly risen at all. Finally, Roosevelt picked a value for the dollar, property valuation, confirmed it, put it into effect. And at that point, things started to improve. So that's what should have happened. By the way, this is as good a time as any to mention. This is what Keynes would have recommended and did recommend. He's scolded or criticized Roosevelt for following Warren's theories instead. And I think that on this and many other scores, Keynes' advice about dealing with the depression was actually very sound. The myth is that Roosevelt was following it.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Yes, it could have been done better. I think that what it should have happened was immediate devaluation of the dollar. Instead, what Roosevelt, because it was clear, by the time Roosevelt took office, the gold standard as it had been had to be at least suspended, because New York banks had run out of gold, essentially. So that was not something there was much choice about. Then the question was, okay, what are we going to do going forward? As I said, what I think they should have done was to just plan on a devaluation of the dollar, get it over with as quickly as possible. You don't announce that plan before you've suspended gold payments because that's just going to make the run on gold worse. But once you've suspended, then you can go ahead and proceed with the devaluation. What Roosevelt did was to engage in this crazy gold purchase program for quite a few months based on”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“The progress going after that, though at a slower rate, was mostly gold starting to rush in from Europe, and it was rushing in only initially because of devaluation, but after that it was mostly rushing in because of fears of the consequences of Hitler coming to power and possibility of war breaking out. That's the story of the early phase of the New Deal. A good start that didn't last that long except as a result of help from abroad that was quite unintentional help.”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“Follow from the stabilization of the banking situation itself. So I don't want to deny that there was a genuine progress during those early months of the New Deal. And I don't want to deny that New Dealers deserve credit for much of it, but it didn't last. Of course, we all know it didn't last. Beyond that first period, once the NRA and associated programs for price controls kicked in, things started to slow down very rapidly. And what kept”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“It was pretty good, but it didn't last very long. In fact, the new dealers kind of knew that it wouldn't last very long, and there are a couple of reasons why first of all there was a big burst of output that was connected to the expectation that the NRA, the National Recovery Administration, was going to be coming into effect because it was one of the early New Deal measures, and it was going to artificially raise prices through controls. So there was a kind of boom that was based only on manufacturers' desires to jump the gun and buy inputs and produce inventory before their own costs went up. So that was part of the story. Of course, when you're coming out from the deepest depths of a depression with a banking crisis and all that, you would expect a rather rapid growth to”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source
“No, I say no because a big part of the truth that that leaves out is what the New Deal didn't do to achieve recovery. And this surprises many people to hear, but it made very little use of fiscal or monetary stimulus. So I would add that the New Deal, whatever it was up to, did not amount to a modern style program of economic stimulus”
2025-10-15 · Conversations with Tyler · George Selgin on the New Deal, Regime Uncertainty, and What Really Ended the Great Depression · IDENTIFIED FROM THE TRANSCRIPT · source