America's Great Depression (Hardcover)

~ (Author) "Study of business cycles must be based upon a satisfactory cycle theory..." (more)
Key Phrases: bills discounted, monetary gold stock, treasury deposits, Federal Reserve, New York, United States (more...)

Editorial Reviews

Product Description

Applied Austrian economics doesn't get better than this. Murray N. Rothbard's America's Great Depression is a staple of modern economic literature and crucial for understanding a pivotal event in American and world history.

The Mises Institute edition features, along with a new introduction by historian Paul Johnson, top-quality paper and bindings, in line with the standard set by The Scholars Edition of Human Action.

Since it first appeared in 1963, it has been the definitive treatment of the causes of the depression. The book remains canonical today because the debate is still very alive.

Rothbard opens with a theoretical treatment of business cycle theory, showing how an expansive monetary policy generates imbalances between investment and consumption. He proceeds to examine the Fed's policies of the 1920s, demonstrating that it was quite inflationary even if the effects did not show up in the price of goods and services. He showed that the stock market correction was merely one symptom of the investment boom that led inevitably to a bust.

The Great Depression was not a crisis for capitalism but merely an example of the downturn part of the business cycle, which in turn was generated by government intervention in the economy. Had the book appeared in the 1940s, it might have spared the world much grief. Even so, its appearance in 1963 meant that free-market advocates had their first full-scale treatment of this crucial subject. The damage to the intellectual world inflicted by Keynesian- and socialist-style treatments would be limited from that day forward.

About the Author

Murray N. Rothbard, the author of 25 books and thousands of articles, was a historian, philosopher, and dean of the Austrian School of economics. The S.J. Hall Distinguished Professor of Economics at the University of Nevada, Las Vegas, he was also Academic Vice President of the Ludwig von Mises Institute in Auburn, Ala.

Product Details

• Hardcover: 368 pages
• Publisher: Ludwig Von Mises Institute (June 15, 2000)
• Language: English
• ISBN-10: 0945466056
• ISBN-13: 978-0945466055
• Product Dimensions: 9.1 x 6.2 x 1.4 inches
• Shipping Weight: 1.9 pounds (View shipping rates and policies)
• Average Customer Review: 4.2 out of 5 stars  See all reviews (33 customer reviews)
• Amazon.com Sales Rank: #347,043 in Books (See Bestsellers in Books)

Customer Reviews

Most Helpful Customer Reviews

111 of 124 people found the following review helpful:

5.0 out of 5 stars Invaluable even after 40 years., March 11, 2002

By	Lord Chimp (Monkey World) - See all my reviews (TOP 500 REVIEWER)

Economist Alan Reynolds wrote: "The terror of the Great Crash has been the failure to explain it." I wonder if he ever read this great book, which is now in its fifth edition. Murray Rothbard's exploration of this devastating economic calamity is both fascinating and pertinent.

Rothbard refutes key misconceptions about the market economy and the Hoover administration's interventionist policies. Was the Great Crash due to capitalism gone wild? Was President Hoover the proponent of laissez-faire that some continue to insist? Did his interventionist actions assuage the depression? _America's Great Depression_ will always be important because of the Great Depression's legacy. Many continue to believe that the free market economy is inevitably inclined to collapse. Also, the interventionist policies of Presidents Hoover and Roosevelt accelerated the growth of the welfare state.

Economists have always observed the relationship between money supplies and business cycles. Rothbard goes a few steps farther, applying the Austrian school's theory of the business cycle to the Federal Reserve's monetary policies during the 1920s. Rothbard spends the first part of the book detailing the credibility of the Austrian theory and dismantling other theories. He shows how artificial increases in the money supply creates harmful imbalances in the economy. With this premise, Rothbard explains that the Federal Reserve's inflationary abuse of the money supply in the "Roaring Twenties" set the economy up for an unsustainable growth spurt that ended in disaster in 1929. (The scary thing is that prices remained fairly stable and hid the effects of inflation with ruinous results.)

After talking money supplies and business cycles for a while, Rothbard turns his attention to President Hoover's actions to correct the problem. Despite good intentions, government involvement aggravated the Depression. The most damaging and glaring mistake of the Hoover administration was the Smoot-Hawley Tariff, which basically smashed the world's economy. But what else was done? How did different policies delay the economy's recovery? There's a lot to be learned here. In the end, the lesson Rothbard hopes to teach is that the best option for government in fixing a depression is "laissez-faire."

Since the book focuses only on the early part of the Depression (up to 1933), it's unfortunate that Rothbard didn't criticize President Roosevelt's interventionist policies, which eviscerated the economy while it struggled to recover. Rothbard would have had a field day examining the effects of the NRA, the AAA, the WPA, the CWA, the Wagner Act, and everything else the New Deal implemented that I can't remember off the top of my head.

Since this book was originally published in the 60s (1963, I think), many people probably sneered at it. After all, in a time when Keynsianism was trendy, who was willing to blame the government for the Great Depression? Praise to Rothbard for this important application of Austrian theory and his exposure of the government's clumsiness.

38 of 42 people found the following review helpful:

5.0 out of 5 stars The Real Story Behind the Great Depression, August 16, 2003

By	Susanna Hutcheson "Copywriting for the Discri... (Midwest U.S.A.) - See all my reviews (TOP 500 REVIEWER)    (REAL NAME)

As a student of the boom and bust and subsequent Depression following the crash of 1929, I have read numerous books on this important subject. It is in knowing the past that we can control the future.

Most books cover the human aspect of this period in American history and that's important. And most of the books cover the events leading up to the crash and depression. But this is the only book I've read that exposes the dynamics behind the scenes that caused the crash and it's terrible crushing length and enormous suffering.

Rothbard explains in great detail how government butted in where it was not needed and created untold suffering. He explains how we allowed England to dictate to us and how in our desire to help Her, our government intentionally hurt its own citizens.

Rothbard was a great economist and a great proponent of the libertarian cause. His belief in Laissez-faire economics is behind his philosophy. It is Laissez-faire that created this country and it is the loss of it that has and is causing us grief and loss of liberty.

This is an excellent book. Published by the Ludwig von Mises Institute, it is a book you'll want to read again and again. Austrian economics are exciting and workable and the Ludwin von Mises Institute is a dynamic proponent of this very workable economic philosophy.

If you are interested in economics and the Great Depression and its real causes, you must read this powerful, well written book.

42 of 47 people found the following review helpful:

5.0 out of 5 stars Definitive work on causes of the Depression, September 26, 2004

By	LMJ (NM) - See all my reviews

In "America's Great Depression", Professor Rothbard effectively demolishes the myths surrounding this tragic event. However, semi-literate pop-historians continue to ignore the fact that the depression was caused by government intervention. (Central bank manipulation is government intervention.) Rothbard's book stands out due to his refusal to reduce this complex event to a simple story of good (New Dealers, Socialists) versus evil ("capitalism"). Upon close examination of such accounts, it becomes clear that not only do "historians" get the facts wrong, they simply fail to comprehend them. Mainstream historians who refuse to even attempt to gain a basic understanding of economics have had their interpretations rendered embarrassingly obsolete by Rothbard.