Economics data indicated that the business cycle before the Great Depression was much more volatile than the economy after World War II. Economists widely assumed the data demonstrated the success of the post-Depression stabilization policies. Romer proved them wrong by showing that what seemed like a decrease in market volatility was really due to improved data collection.Dr. Romer thinks that the higher taxes levied to fund the projects of the New Deal helped to prolong the Great Depression.
I'm not a real libertarian who thinks the markets should be left completely to themselves, but I think we need to be really, really careful when we start using federal money to alter the very complex dynamics of our economic system.