Working out of the financial crisis

The largest of the New Deal agencies to come on-line during the 1930s to help combat the ills of an extremely bad economic situation in the United States was the Works Progress Administration. The agency built public buildings, projects and roads. It operated large arts, drama and media and literacy projects. It fed children and redistributed food, clothing and housing. Anyone who needed a job could become eligible for most of the WPAâÄôs employment opportunities, and hourly wages were based on average local wages. Then, just as now, there were grave concerns about a growing unemployment rate and uncertainty on Wall Street, in particular, and in the financial markets, in general. Moreover, there was an increasing anxiety about how to institute the proper regulation of Wall Street in order to insulate Main Street. The economy began to slow during the 1920s as people borrowed money to buy more stocks on the opinion that stocks could only continue to rise âÄîmuch like the unrealistic tone of the speculative investor in the recent housing boom. Likewise, prior to the 2008 housing market crash, Americans were also borrowing more money to buy or refinance their homes. With borrowing requirements becoming so relaxed, many borrowers did not even have to put any âÄúskin in the gameâÄù by being required to come up with a down payment on the loan. However, there are two other issues we were not dealing with at that time: The global war on terror, with its ever-expanding military and domestic security spending necessities, and a surge in energy prices across a mostly petroleum-based United States economy. Because of these factors, we are transferring $50 billion a year in wealth that often times ends up in the hands of some people who, quite frankly, donâÄôt like us very much. In addition to the mortgage meltdown, an extremely volatile stock market, a financial market crisis and a banking and credit liquidity problem, we are also fighting two wars and have looming issues like the insolvency of 1930s social programs, as well as having a deficit of at least $10 trillion. One of the answers to our current economic chaos may, perhaps, be found in the 1930s: jobs, jobs and more jobs. Walter H. Annenberg, professor of history, and author Michael B. Katz argue that The WPA accomplished what it did by employing nearly 2.1 million people. As another 1 million youth worked for programs such as the National Youth Administration and Civilian Conservation Corps, hundreds of millions of dollars were pumped in to the American economy âÄî which may, in fact, be the medicine that our country needs now. Imagine the federal, state and local government projects that need to be completed here in the United States. Imagine the highway, road and bridge construction and refurbishment that need to be done. Certain social ills may also be positively affected, like some forms of homelessness, gang activity, crime rates overall, poverty and, of course, unemployment. Perhaps with a new administration being elected, we can begin to improve our economy and, with that, our standing in the world. Look at the accomplishments of the 1930s and the achievement that, for a time, served us well. Perhaps some similar ideas will have the capacity to serve us well in the future. Paul Edward Hamilton is a University student and former Minnesota Daily columnist. Please send comment to [email protected]