Hello, I'm 1930s America, and I Have a Recovery Problem: A Review of George Selgin's "False Dawn"

George Selgin’s False Dawn: The New Deal and the Promise of Recovery, 1933–1947 revisits the debate over the effectiveness of the New Deal. While Franklin Delano Roosevelt’s policies promised “three R’s”—relief, recovery, and reform—False Dawn zeros in on the middle one. The NBER’s official business cycle dating notes that the economy entered an expansion phase right after FDR assumed office and, aside from a yearlong downturn that began in 1937, it continued expanding until October of 1945. Still, the post-1933 recovery was anything but steady. Data on manufacturing production and general business activity suggest an economic rollercoaster with several starts and stops. In fact, when Germany invaded Poland on September 1, 1939, most economic measures stood level with where they had been six years earlier. Selgin’s treatment of this era is impressively engaging, fair-minded, and comprehensive. While a few New Deal policies—particularly the spring 1933 financial reforms—worked toward recovery, many others prolonged the economic hardship. Only after the Second World War did the economy finally move past the Great Contraction and into a lasting recovery.