Political Science Rant

Our discussion stumbled its way to the dawn of the Great Depression at which time the professor blamed the Depression on consumers because demand (as in supply & demand, economics) had gone down for many products. Instead of blaming the companies that maintained too high of a supply, he blamed the people for not maintaining a demand.

How backwards can a person's thinking get? According to his logic, if every person in the US bought a new car in 2005, car companies should (foolishly) expect these very same people to all buy new cars again in 2006. The companies would prepare for this anticipated demand by producing an equal to greater number of cars. When the consumers don't show up at the dealership to buy these new cars, it would be the fault of the consumers for not maintaining that level of demand into 2006. The fact of the matter is that the car companies were wrong for having created such a surplus of supply. The demand had been met in 2005. To blame the entire Depression on consumers' failure to maintain a constant level of demand is insane. Eventually, everyone who can afford it will own an automobile /refrigerator /radio /telephone /washing machine /etc.

What about the reliance on credit (just as we have today)? What about the people who, once they maxed their credit accounts, refinanced their homes in order to have more spending money (just as we do today)? What about fractional reserve banking (2nd article; Google; though this came about in 1933, it didn't help the issue)?

I'd go on, but I'd really like to enjoy our sleep in. "Tootles."

Crispy