1937 Redux? Not likely with a Republican House, but we can learn from history if we pay attention.

Amity Shlaes has a great article that reflects on the series of unforced errors made by FDR that plunged us into the final phase of the Great Depression.

Scholars of economic history are asking another question: Are we repeating 1937?

That year, when Americans were expecting their economy to finally pull out of the Great Depression, the stock market dove again, with the Dow Jones Industrial Average dropping from the 190s in March 1937 to less than 100 in March 1938. Nonfarm private unemployment, the measure of Roosevelt's industrial economy, increased to more than 18 percent. Industrial production plunged by a third.

FDR increased taxes, the first Social Security payments were being withheld, bank reserve requirements were doubled, unions gained new power and the number of strikes doubled, and FDR declared that he wanted a government that was "an instrument of unimagined power." That scared the crap out of everyone who was used to economic freedom.

Roosevelt relished hunting down big firms through regulatory action and blaming new sectors, such as utilities, for slowdowns -- on some days. Other days, he invited business leaders into the Oval Office and talked about partnership and a "breathing spell."

This inconsistency itself posed a problem. The diary of an Ohio lawyer named Daniel Roth, which was recently republished, captures the pervasive anxiety of the period. "We are having a bad steel strike in Youngstown and the mills have closed," Roth wrote on June 22, 1937. "The state and federal governments seem to support the labor unions and there has been a complete breakdown of law and order. Business is very quiet."

From the U.K., John Maynard Keynes wrote to FDR that it was all right to nationalize utilities or to leave them alone -- but what, Keynes asked, was "the object of chasing the utilities around the lot every other week?”"

Remind you of Obama, who thinks that demonizing business one day and inviting them to the White House the next is going to cause business to go on a hiring spree?  The White House is not big enough to hold the number of small business owners who he would have to schmooze to have any effect, and the small business owners I know would not attend.

One other similarity between then and now: it should be remembered that FDR encouraged a cult of personality every bit as much as the tyrants of Europe who were later defeated in World War 2.

"Barack Hussein Obama .... MMMM ... MMMM ... MMMM" the children sing.