Commanding Heights Episode 1 Summary Stephanie Watford
The first episode of Commanding Heights begins by showing a world with a global economy that is then torn apart by World War I. Following World War I two young economists emerged that hoped to solve the world’s economic troubles, John Meynard Keynes and Friederich Hayek. Keynes put forth the belief that a government in times of economic despair should spend money and go into a deficit in order to build the economy back up and then when the economy is stable again should then grow a surplus. Many people and governments stood behind this principle. During the Great Depression President Franklin Roosevelt used this strategy in implementing his New Deal. He created new government agencies to put the unemployed citizens to work. The strategy continued as we entered into World War II. After entering World War II and the jobs that were needed on the home front to support the war effort the United States was able to pull out of the Depression. Hayek believed that for an economy to survive the free market must be allowed to have its ebbs and flows. He believed that while at times unemployment would be high government should not step in with more regulations. Hayek believed that government regulation on the market would lead to government control and would ruin the economy. After World War II much of the world decided to follow Keynes’ theory. In Eastern Europe, Africa, and much of South America the result was Socialism, which lead to more economic hardship. In Western Europe and the United States the result was booming economies. In the 1970’s the economic booms that came at the end of World War II came to an end and the United States and Britain were once again facing economic hardships. It was not until Ronald Reagan was elected as the United States President in 1980, and Margaret Thatcher was elected as the British Prime Minister in 1979 that things...
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