Hard Times Compared To Great Depression

By Dan Bewley and Scott Thompson, News On 6

TULSA, OK -- Many people, from politicians to economists are saying this downturn is equal to the Great Depression. Historians say economic hard times usually follow one theme, greed.

In the 1800's, it was the greed over land, on Friday it follows the real estate market and in the 1920's it was speculation over the stock market.

The stock market crashed in 1929, sending the U.S. into the Great Depression.

ORU professor Paul Vickery says it happened because two-percent of the country's population controlled 28% of the money and that control was centered around Wall Street. Vickery says the wealthy began buying stocks with money they didn't have in hopes of a big return.

"It was an involvement in them trying to over extend themselves and make easy, quick money," said Dr. Vickery.

The governments answer then was to essentially do nothing. Dr. Vickery says congress actually wanted to increase inflation and began paying farmers to grow fewer crops. The idea was to force the price of food and other items to rise and get more money into the marketplace.     

"Which was the whole goal during the depression was to try to get money circulating again. Try to money out from under mattresses and buried in cans and try to get it out into the economy to stimulate economic growth," said Dr. Vickery.

Flash forward 80 years to the latest economic turmoil. Vickery says the lesson learned from the 1920's is that government must take on debt to get the economy flowing.

"Withholding money from people is not going to help. Stimulating packages is going to help because it's going to get money circulating and money circulating seems to be what brings us out of depressions," said Dr. Vickery.

Vickery hopes the haunting images from the past serve as an example of how to react when facing troubled times. 

"History gives us a sense of hope; it gives us a sense of perspective. It gives us the sense that we've been here before, we can overcome, and we will emerge stronger than we have last time," said Dr. Vickery.

Vickery says there are significant differences between now and then. For example, in the 20's and 30's the unemployment rate was around 40%, now it's closer to 6%.