Comments on “The Ideological Origins of the Revolution in American Financial Policies”

Abstract

Green’s paper is a valuable contribution to the literature on the 1930s. He provides a succinct discussion of many of the proposals for financial reform as well as of the reforms actually accomplished during that traumatic decade. For Green, the reforms should be viewed as the result of the shift in American attitudes “toward the relative power and responsibilities of business and government” as well as an acceptance of greater power for the federal government relative to the states. Green views the 1930s as characterized by government concern for the economic security of its citizens. He also points to the erosion of such cherished concepts as the commercial loan theory as evidence of the triumph of economic analysis over conventional wisdom. In this regard, he quotes from Keynes, who argues, in effect, that the ideas of “practical men” are the products of the work of “some defunct economist.”