Economic History of the USA
Economic Theories of the Great Depression
The Great Depression and John Dewey (1859-1952)
In “The Great Depression as Historical Problem,” Michael A. Bernstein argues that to fully understand the Great Depression, a look beyond immediate causes like the 1929 stock market crash will consider long-term structural changes in the economy.[1] John Dewey was an American philosopher, psychologist, and educational reformer born in Vermont in 1859.[2] He developed theories in educational theory and social philosophy, becoming an intellectual of the early twentieth century. Dewey taught at several major universities, including the University of Chicago and Columbia University, and died in 1952, leaving a legacy in philosophy, education, and social thought.
The Great Depression of the 1930s was a severe economic downturn caused by factors such as the 1929 stock market crash, structural weaknesses in the banking system, and protectionist trade policies like the Smoot-Hawley Tariff Act.[3] John Dewey addressed the causes of the Great Depression in his writings. In his 1930 book, Individualism Old and New, Dewey critiqued the prevailing economic system, arguing that social responsibility would effect the “doom of an exclusively pecuniary-profit system.”[4]
Causes of the Great Depression
John Dewey saw economic inequality, “pecuniary individualism,” as a key cause of the Great Depression.[5] He argued that financial and industrial leaders controlled too much wealth. This concentration of power weakened the economy by limiting consumer spending. The wealthy hoarded resources while workers struggled with low wages. Without widespread purchasing power, businesses could not sustain growth.[6]
Dewey also blamed the capitalist profit system for economic instability. He believed industries prioritized short-term profits which were parasitic to technology and science.[7] Speculation and financial manipulation, rather than productive investment, drove economic activity.[8] He saw government inaction as another cause. Both major parties, he argued, served financial interests instead of regulating the economy.[9] Without intervention, market failures deepened the crisis.
The End of the Great Depression
Dewey believed the New Deal was a partial response to the crisis but did not go far enough.[10] He acknowledged that Roosevelt’s policies provided relief but saw them as temporary fixes. The New Deal preserved capitalism instead of restructuring the economy. He supported the socialization of banks, railroads, power, mines, and oil.[11] He argued that only public ownership of key industries could create long-term stability.
He believed economic planning, rather than market competition, was necessary to prevent future crises. Dewey called for higher taxes on the rich to fund social programs. Taxation remained too low on the wealthy, and higher death taxes were needed to fix the overly “swollen income.”[12]
In the article “What Ended the Great Depression?” economist Christina D. Romer argues that a primary factor leading to the end of the Great Depression was a significant increase in the gold inflows from Europe in the mid- to late-1930s.[13] Dewey’s argument however that the Great Depression’s resolution required more than technical economic adjustments may be reconsidered.
John Dewey’s economic theory offers an interpretation of the Great Depression. Edward J. Bordeau’s 1992 article discussed how Dewey faced critics such as Richard Hofstadter, Morton White, and Reinhold Neibuhr.[14] But because Dewey’s approach made a trifold connection of religion, culture, and economic structures, a disambiguating critique citing Carl McIntire in the following section distinguishes between social and political ends and faith-based solutions for the Great Depression. The rationale for this comparison with McIntire is because Dewey specifically contrasted “spiritual capital” with “material capital.”[15] Moreover, Dewey critiqued religious institutions for their passive response to the economic crisis.[16]
Historiographical and Interpretative Dimensions: Challenging Dewey’s Economic and Social Theory
A notable critic from the Christian perspective in the 1930s was Carl McIntire. McIntire was a prominent Presbyterian minister and leader of the American Council of Christian Churches, an organization that opposed modernist theology and secularism.[17] There is no documented evidence of a personal meeting or in-person debate between John Dewey and Carl McIntire. However, both men were influential figures during the same time period and had significantly different views on many important issues, particularly education, politics, and religion.
Two sources that discuss McIntire’s beliefs are a newspaper he founded, The Christian Beacon (1936- ) and the book The Rise Of The Tyrant: Controlled Economy Vs. Private Enterprise (1945).[18] His key debate later, in 1970, with Madalyn Murray O’Hair recapitulated McIntire’s biblical worldview on these topics as well.[19]
Carl McIntire believed that the Great Depression was a consequence of moral and spiritual decay in American society. In his works, McIntire criticized secular humanism and government intervention, particularly the New Deal, for exacerbating the problem.[20] A sermon preached by McIntire in 1937 stated the merits of strict constitutionalism, as an excerpt below shows.
The reason, no doubt, is that in our day, especially the last few years, people have become aware of the fact that the constitution is challenged and our social system disputed. In the name of so-called social justice, and the name of humanity, in the name of progress, and the name of “the greatest good for the greatest number,” and in various other names and – all popular, find sounding slogans—so frequently the very foundation principles upon which our Government rests are being challenged.[21]
– Carl McIntire, “Thanksgiving Message,” Sermon Delivered on Thanksgiving Morning,
November 25, 1937 at the Collingswood Presbyterian Church
He argued that government expansion and increased reliance on the state to solve economic issues were fundamentally incompatible with Christian values.[22]
Summary Analysis
John Dewey and Carl McIntire explained the Great Depression in opposing ways. Dewey blamed structural weaknesses in capitalism and argued for public control of key industries, higher taxes on the wealthy, and economic planning to prevent future instability. He believed religious and cultural institutions should engage in social transformation rather than remain passive. Differently, McIntire saw the crisis as a symptom of moral and spiritual decline. He rejected government intervention, claiming it undermined personal responsibility and Christian values. While it seemed they both thought that the church was not doing enough to help, their disagreement reflects a lasting divide between those who see government as a force for progress and those who view it as a threat to individual and moral order.
[1] Michael A. Bernstein, “The Great Depression as Historical Problem,” OAH Magazine of History 16, no. 1 (2001): 3–10.
[2] Jay Martin, The Education of John Dewey: A Biography (New York: Columbia University Press, 2003), 31.
[3] Robert J. Samuelson, “Revisiting the Great Depression,” The Wilson Quarterly 36, no. 1 (2012): 36–43.
[4] John Dewey, Individualism, Old and New (1930; repr., Amherst, NY: Prometheus Books, 2009), 58.
[5] Ibid., 45.
[6] Ibid., 51.
[7] Ibid., 45.
[8] Ibid., 19.
[9] Ibid., 20-21.
[10] Ibid., 55.
[11] Ibid.,19, 29.
[12] Ibid.
[13] Christina D. Romer, “What Ended the Great Depression?,” The Journal of Economic History 52, no. 4 (1992): 759.
[14] Edward J. Bordeau, “John Dewey’s Ideas About the Great Depression,” Journal of the History of Ideas 32, no. 1 (January 1, 1971): 67.
[15] Dewey, Individualism, Old and New, 7.
[16] Ibid., 31; MRENNIS, “John Dewey,” June 18, 2012.
[17] SMU Jones Film. “Carl McIntire Speaks at the National Council of Churches – December 1972,” February 24, 2023.
[18] Carl McIntire, “Christian Beacon (Collingswood, N.J.) 1936-Current,” The Library of Congress, 1936; Carl McIntire, The Rise of the Tyrant: Controlled Economy Vs. Private Enterprise (Collingswood, NJ: Christian Beacon Press, 1945).
[19] Ministry of Carl McIntire, “Face to Face With Dr Carl McIntire and Madalyn OHaire: February 16, 1970,” June 8, 2023.
[20] Markku Ruotsila, Fighting Fundamentalist: Carl McIntire and the Politicization of American Fundamentalism (Oxford: Oxford University Press, 2016), 59.
[21] Carl McIntire, “Thanksgiving Message,” Sermon Delivered on Thanksgiving Morning, November 25, 1937 at the Collingswood Presbyterian Church.
[22] Markku Ruotsila, Fighting Fundamentalist: Carl McIntire and the Politicization of American Fundamentalism (Oxford: Oxford University Press, 2016), 60.
Bibliography
Bernstein, Michael A. “The Great Depression as Historical Problem.” OAH Magazine of History 16, no. 1 (2001): 3–10. https://www.jstor.org/stable/25163480.
Bordeau, Edward J. “John Dewey’s Ideas About the Great Depression.” Journal of the History of Ideas 32, no. 1 (January 1, 1971): 67. https://doi.org/10.2307/2708325.
Dewey, John. Individualism, Old and New. 1930. Reprint, Amherst, NY: Prometheus Books, 2009.
Foldvary, Fred E. “The Austrian Theory of the Business Cycle.” The American Journal of Economics and Sociology 74, no. 2 (2015): 278–97. https://www.jstor.org/stable/43818666.
Martin, Jay. The Education of John Dewey: A Biography. New York: Columbia University Press, 2003.
McIntire, Carl. “Christian Beacon (Collingswood, N.J.) 1936-Current.” The Library of Congress, 1936. https://www.loc.gov/item/sn78004853/.
———. “Thanksgiving Message Sermon Delivered on Thanksgiving Morning, November 25, 1937 at the Collingswood Presbyterian Church.” November 25, 1937. https://carlmcintire.net/thanksgiving/.
———. The Rise of the Tyrant : Controlled Economy Vs. Private Enterprise. Collingswood, NJ: Christian Beacon Press, 1945.
Ministry of Carl McIntire. “Face to Face With Dr Carl McIntire and Madalyn OHaire: February 16, 1970,” June 8, 2023. https://www.youtube.com/watch?v=CQ9GrjL0kmg.
Romer, Christina D. “What Ended the Great Depression?” The Journal of Economic History 52, no. 4 (1992): 757–84. https://www.jstor.org/stable/2123226.
Ruotsila, Markku. Fighting Fundamentalist: Carl McIntire and the Politicization of American Fundamentalism. Oxford: Oxford University Press, 2016.
Samuelson, Robert J. “Revisiting the Great Depression.” The Wilson Quarterly 36, no. 1 (2012): 36–43. https://www.jstor.org/stable/41484425.
SMU Jones Film. “Carl McIntire Speaks at the National Council of Churches – December 1972,” February 24, 2023. https://www.youtube.com/watch?v=Zqk0aA1zdLY.