How about a healthy dose of inflation?

Theoretically, inflation really doesn't cause any harm to an economy. But it does tax those who sit on wealth and refuse to earn more or invest what they have.

Of course, a deep recession is deflationary, which just encourages even more of this hoarding you dislike. Nobody is going to invest when just holding money earns a risk-free return. Who would loan money when interest rates are negative?

Japan actually had good growth in its fiscal stimulus years. They just jumping back into budget-balancing as soon as growth had recovered, and would fall back into recession as a result.

Of course, the slow population growth didn't help. In fact, adjusted for population growth, Japan has grown faster than the US over the last decade.

Economic growth was strong, closer to 10%. Unemployment was falling, but you didn't get full employment until WW2. This is to be expected when you are coming off a 25% unemployment rate and a decline in demand of 40% (90% in equity markets). As the economy was growing, you still didn't need many new workers to meet the growing demand because your productive capacity was built for output much higher (and you were still implementing technologies developed during the negative years).

You can't really compare Unemployment Rates of two different periods like this though. 20% of the workforce now works for the Government. The New Deal programs only employed a few thousand people. A much larger proportion of the population are employed today, so unemployment does not fluctuate so wildly.

The New Deal was not successful at reaching full-employment. You really needed a War Economy or a Centrally-Planned Soviet Economy to do this in the short-term.

The New Deal was actually quite small on a macroeconomic basis. However, it was the programs he created that created the society we know today of high home ownership, middle-class earners, social security & basic health care.

a) Well, to be honest, the economy was actually growing very fast under the New Deal, between 5% and 10% every year, from 1933 right up to the US entry into WW2. Millions of jobs were added before WW2. There was only one recessionary year when the Government tried to cut spending too early, but quickly corrected it.

b) You don't have to be in a war to push an economy out of a recession... rather than bombing Europe, you could spend the money building infrastructure.

c) The prosperity of the US was very real. The improvement in technology, health, education, employment and productive capacity was much higher from the wartime investments. The same was in fact true of the rest of Europe. Sweden was the first to apply the principles and became just as wealthy as the US.

I'm not sure where you are getting the mercantilism connection to Keynesian policies. Keynesians were very much against the Gold standard... Everyone from Friedman to Keynes to Bernanke agree the Gold standard was a primary cause of the Depression.

You clearly oppose Globalization, but I don't think it really matters. The New Deal really didn't have anything to say about global trade and it really doesn't make much of a difference when everyone is in a deep recession as well.

We are mostly arguing semantics. I have no problem if you want to say most of the higher education came post-war, but I would point out that was just a planned continuation of the New Deal. I don't know of any government agency that has profitability as a goal - the TVA's purpose was to electrify rural areas and provide cheaper electricity & modernize agriculture, which it did.

The wage compression that created the middle class was unmistakably during the New Deal. Economists typically attribute this to wage controls and unionization. You aren't going to find a pension program with the security or anything near the low administration costs of Social Security. Even today, most elderly Americans would be in poverty without it.

True, the widespread gains in health were probably motivated by the war. As I recall, 60% of recruits were rejected in many areas because they had STDs or were missing too many teeth. Nevertheless, it took massive Government programs to turn it around.

According to the OECD, the large investment in science & engineering in the mid-late 40s is responsible for the US' early lead in productivity and education. I know you don't attribute this to the New Deal, but it doesn't really matter because it was still the Government's demand-side investment that created these gains.

As I said before, the early New Deal was rather small - especially by the standards of Government today. However, the Keynesian policies of the New Deal DID pull us out of the Depression and created a modern society unseen even in the best years of the gilded age. WW2 was just a magnification of these policies.

WW2 was the New Deal on steroids. The Government quite literally quadrupled spending and took full control of the economy, even to the point of regulating wages and dictating output. If you want to argue WW2 pulled the US out of the Depression, then you're just saying the New Deal was too small.

The GI Bill created the most educated workforce on the planet and paid for 60% of all University graduates. Poverty among the elderly was reduced by 80%. Home ownership and the middle class was created in just a few years from the New Deal. It was a huge success.

You're also ignoring the rest of the world. As each country implemented Keynesian policies, their economies quickly recovered. The US was just one of the last to join the party.

There are no mainstream free-market Austrian economists anymore... they died out. Even Bush's economists are New-Deal Keynesians.

The US Government has been the primary investor in general research since WW2 and I would not consider it wasteful at all.

They even pick the winners and losers. They allow the universities and academies to publish to the public and allocate spending where it will be most beneficial.

The Government has done this because private corporations are not willing to pay for something you just give away free to the public, especially if that can be copied indefinitely (like research or software). Sure, it will grow the overall economy but the private company will be at a disadvantage.

In this case, Government quite often is more efficient at growing productivity because everyone gets to use it. Private research is often secret or even intentionally restrictive.