Regarding Richard E. Sincere Jr.’s Sept. 12 Taking Exception letter, “Mr. Obama could do worse than follow Warren Harding’s lead”:
Mr. Sincere’s letter gives credit to government spending cuts by Republican President Warren Harding for ending the “depression” of 1920. But the facts are as follows:
Government spending had been greatly ramped up for World War I, hitting 29.3 percent of gross domestic product in 1919. It was then massively cut, under Democratic President Woodrow Wilson, to 12.8 percent of GDP in 1920. It was increased (to 14.3 percent GDP) in 1921, the year Harding was inaugurated. The letter stated that the “depression ended by the summer of 1921.”
From Harding’s March inauguration to summer was hardly enough time for Harding’s policies to have made an appreciable impact. The most obvious cause of the temporary high unemployment of 1920 was massive layoffs related to the huge Wilson spending cut. An obvious reason for low unemployment during the Harding years was the need for U.S. industry and agriculture to supply Europe, which had been devastated by the war.
Richard S. Smith, Triangle