I don't think you have any clue of the magnitude of the monetary crisis that then existed. The problem was not trying to kick in an additional 5% of circulating funds to clear an inventory of few unsold Louis Vuitton handbags or a yacht or two. The problem was to try to make up for an enormous contraction in credit which resulted in the collapse in the market for yachts, houses, etc. I don't have the exact numbers in front of me, but what we would call M3 today contracted by well over 50%, which represented a large multiple on the dollar bills in circulation. The sudden creation of enormous excess inventories of these things meant a several decade backlog to clear the overhang.
Even Milton Friedman will tell you that the consequences of dramatic deflation are, well, dramatic, and the only solution is to print money and hand it out to those who will spend it.
I also think you miss the entire point of the various conservative economic schools, such as Ludwig von Mises. Their prescription is never to have expanded credit as much as has had happened in the first place so that you don't create the bubble that then, inevitably they would tell you, collapsed. They have little to tell you about what to do after a bubble collapse, except perhaps, as you advocate, do nothing.
Likeminded conservatives of the 30's, however, took the prescription to do nothing to their political graves. The voting public would not stand for it.
Also a tax cut on the rich would only very partially make up for the collapse in their own earning capability brought on by the collapse in demand for the prodcuts of their factories because of the high unemployment among the segments of the population that would normally have purchased those goods.
Your let them eat cake attitude is very sweet.
---
? So far we agree on the solution, but disagree on how to achieve the solution. My solution is to lower taxes to solve the credit problem, yours is to spend gov money on earthworks and entitlements.
"Even Milton Friedman will tell you that the consequences of dramatic deflation are, well, dramatic, and the only solution is to print money and hand it out to those who will spend it."
I can't believe Milton Friedman would support gov subsidies to interest groups over tax cuts to all.
"Likeminded conservatives of the 30's, however, took the prescription to do nothing to their political graves. The voting public would not stand for it."
No, as documented, they voted for massive and unprecedented tax hikes.