The Forgotten Man by Amity Shlaes

A Revisionist History of the Great Depression

In The Forgotten Man, Amity Shlaes has written the most compelling and readable history of the Great Depression ever to come out. In so doing, Shlaes has taken a period that everyone thinks they know about and shows that the true story of the Great Depression is far more complex than hitherto believed.

The standard history of the Great Depression is well known. Because of the failures of capitalism, the stock market crashed in October, 1929, impoverishing millions of people and wrecking the national economy. Banks failed by the thousands. Tens of millions of people were thrown out of work.

Presiding over all of this was a cold hearted President named Herbert Hoover who refused to do anything about it, believing that "the market" would fix everything. When the market didn't, the people turned to the sainted Franklin Roosevelt, electing him in 1933. Through massive government intervention and wise, kind hearted programs, President Roosevelt brought hope to the nation and, eventually, the economic dislocations of the Great Depression receded. Franklin Roosevelt is now considered by many to be the greatest President of the last century.

The truth, as Shlaes demonstrates, in a little more complicated. For one thing, far from being a cold hearted, laisser faire politician, Herbert Hoover was a strong advocate of government intervention. Unfortunately his efforts to solve the economic crisis caused by the stock market crash proved disastrous. The Hoot Smalley Act, designed to raise tariffs to protect American industries, caused a trade war with European countries that lengthened and deepened what was a severe recession into the Great Depression.

Franklin Roosevelt's efforts were little better in addressing the problems of the Depression. While some of his policies, such as the bank holiday, were certainly necessary, others were little more than efforts to extend government control over the economy for its own sake. The New Deal had a very dark side, as Shlaes points out.