One of the most widely-held views about 20th Century America is that FDR’s policies brought the country out of the Depression. But according to my research, FDR’s industrial and labor policies actually prolonged the Depression for several years by subverting the normal process of competition, supply, and demand, and creating industrial and labor cartels that artificially raised wages and prices and substantially impeded job creation. In fact, the total number of hours worked relative to the working age population recovered only slightly as late as 1939. By the late 1930s, FDR realized that these policies were damaging the economy, and economic policies shifted significantly at this time, which made the economy more competitive and which began to reduce artificially high prices and wages. This policy shift resulted in higher rates of economic growth and job creation and set the stage for the World War II economic boom.
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