The Great Depression was caused by the Government's intervention.

The great depression was not caused by the failure of the free market. The invisible hand will always pull an economy out of the dumps if it is left alone. The great depression would have ended much sooner if the federal government if they had left it alone. But as we can see today, the government has a difficult time sanding by and waiting for the invisible hand to sort things out, and therefore creates more problems than there were originally.            

One of the first mistakes of the government was to put into action the Expansionary Monetary Policy that created fake low interest rates.  By trying to expand the economy, this actually overheated the stock market. This decreased the money supply into the economy; because of the low money supply, people were much less likely to spend their money. When people are spending money the economy gets stronger. We see the opposite here, and the economy weakened.

Then the government enacted The Smoot Hawley tariff in the 1930’s, which placed a high tax on imported goods. This tariff kept a lot of trading from occurring, and instead of stimulating the economy it helped to weaken it. By this time America was deep into the depression, the government again would not leave the economy alone. They created the National recovery act of 1933 and the Wagner Act 1935. These were anti business and pro labor regulations that were controlled by the federal government. This also helped to weaken the economy, because when the businesses are suffering the people are as well. Because the businesses were doing badly, that means less jobs for the people as well as they could not create products that the people could purchase to help stimulate the economy. This again kept money from flowing into the economy.

High wage policies enacted by Hoover and Roosevelt kept businesses from hiring and decreased the amount of jobs that were available to the people.

The great depression may have happened whether the government had intervened or not. But the great depression would not have been so terrible if the government had not intervened.

Charter City Essay

There are several things necessary to create a society where there would be economic prosperity.  Some of the most vital things to a prosperous economy are technology, property rights, and the invisible hand.

If we are to prosper we have to improve constantly. We need people who can think outside the box, and improve the way that society does things. If there is not new creation, improved machinery, then the economy will slow and become stagnant and fall into monotonous routines. We need to create things that increase jobs and pay. David O McKay said, “we must strive for more fertile acres; bring from the mountains gold and silver in abundance; found factories to furnish more employment; extend in length and width our concrete public high-ways; build banks to protect, or to dissipate, as has been the case recently, the wealth we accumulate; transform our vast coal fields into electricity that will furnish light, heat and power to every family”. He made it clear that we need take all aspects of our lives and make them better, as efficient as possible. To have economic growth labor productivity must be improved, through technology we must find ways to increase the amount of products while using less resources.

We need freedom, a constitution, and a government.  There needs to e an institution that protects the rights of freedom. Even in a uninhabited part of the planet, there needs to be set boundaries; boundaries that protect the liberty and property of the individual. If there are not these restrictions there cannot be a flourishing economy. The more freedom that a the individual has the more power they will have to act in self interest, which will then in return benefit the entire society. “We believe that no government can exist in peace, except such laws are framed and held inviolate as will secure to each individual the free exercise of conscience, the right and control of property, and the protection of life” (D&C 134:2).

Another vital part of a successful economy is the invisible hand and a market economy. In the free-market people have the right to benefit from private enterprise and profit; people are able to voluntarily exchange goods and services, without restraints and controls. In the free market the self-interest of one person benefits all. This is what the invisible hand is. Problems begin to occur when the government-instead of protecting the people’s rights as it should- tries to take care of the economy instead of letting the invisible hand to balance it all out. Leonard E. Read “There is a fact still more astounding: the absence of a master mind, of anyone dictating or forcibly directing these countless actions which bring me into being. No trace of such a person can be found. Instead, we find the Invisible Hand at work…Leave all creative energies uninhibited. Merely organize society to act in harmony with this lesson. Let society’s legal apparatus remove all obstacles the best it can. Permit these creative know-hows freely to flow. Have faith that free men and women will respond to the Invisible Hand”.