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Free-Market Ideas Regarding The Great Depression

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Those who oppose free-market ideas say that this type of economy will result in chaos and depressions. This view, also known as Keynesian economics, states that government must regulate and help the economy in order for it to prosper; it is the glue that holds everything together. Regarding the Great Depression, Aikins (2009) stated “It was obvious from the Great Depression that…the state lacked the institutional capacity and control mechanisms to ensure the effectiveness of the free market system” (p. 2). In other words, the Great Depression occurred due to lack of government intervention, and Franklin Delano Roosevelt’s New Deal was simply not enough to help. However, Barberich (2014) argued that the New Deal did not better the economy …show more content…

In short, the government did in fact try to help the economy and failed to do so. Additionally, free market has been shown to be better for the economy rather than cause chaos. Chris Brady and Orrin Woodward (2013), who have over twenty years of experience in this field, stated, “free enterprise naturally encourages high savings, low debt, frugal spending, and wise investment in solid business enterprises” and highly discourages “bubbles, crashes, or major downturns” (p. 243). This is the opposite of chaos. Brady and Woodward also noted, “if entrepreneurs are not treated well in a nation, they go elsewhere and take jobs and capitol with them…this always leads to a decline in the nation they leave” (p. 243). For example, Seagate Technology LLC, Accenture, and Cooper Industries Inc. are just a small list of companies that have moved out of the U.S. in order to avoid high corporate taxes. When government creates more programs and procedures, jobs are lost because the entrepreneurs are not willing to go along with it any more. Based on this, it is logical to say that free market does not cause chaos but …show more content…

Das (2008), noted that by 2008, China’s economy had gone from horrible to booming. Interestingly, 2008 is considered “the year the Asian century truly began” (p. 57). If China’s economy was in poverty, but then turned itself around so quickly, something must have drastically changed. Further research by Das, a Ph.D. in international economics, credited this miraculous change to implementation of free-market ideas: “rapid growth…in China, has resulted from free-market-oriented…economic policies and principles” (p. 60). Because China applied free-market principles to its economy, it was able to turn itself completely around from a poor country to a rich one. Das further concluded that China’s economy is extremely prosperous because of free trade and that “China has progressively benefited from stylized free-market strategies” (pp. 57-58). Thus, as shown by China’s great turnaround, when free-market principles are implemented, the entire country greatly

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