<P> Lowell E. Gallaway and Richard K. Vedder argue on the basis of libertarian theories that the Great Depression was caused by too high wages which they say had caused a loss of depositor confidence which caused the bank runs . They further conclude that the "Great Depression was very significantly prolonged in both its duration and its magnitude by the impact of New Deal programs". They suggest that without Social Security, work relief, unemployment insurance, mandatory minimum wages and without special government - granted privileges for labor unions, business would have hired more workers and the unemployment rate during the New Deal years would have been 6.7% instead of 17.2% . Amity Shlaes wrote that "from 1929 to 1940, from Hoover to Roosevelt, government intervention helped to make the Depression Great". Shlaes said that the NRA was misguided because it used price setting to fix monetary problems . According to Shlaes, Roosevelt's experimentation frightened business into inaction and prevented recovery . Eric Rauchway showed that Shlaes tried to diminish the economic growth by referring to the unrepresentative Dow Jones Industrial Average . He continued that usually a historian or economist would have referred to the gross domestic product, which according to the Historical Statistics of the United States grew impressively by 9% annually during Roosevelt's first term and by 11% annually after the short recession of 1937--1938 . </P> <P> The economic reforms were mainly intended to rescue the capitalist system by providing a more rational framework in which it could operate . The banking system was made less vulnerable . The regulation of the stock market and the prevention of some corporate abuses relating to the sale of securities and corporate reporting addressed the worst excesses . Roosevelt allowed trade unions to take their place in labor relations and created the triangular partnership between employers, employees and government . </P> <P> David M. Kennedy wrote that "the achievements of the New Deal years surely played a role in determining the degree and the duration of the postwar prosperity". </P> <P> Paul Krugman stated that the institutions built by the New Deal remain the bedrock of the United States economic stability . Against the background of the 2007--2012 global financial crisis, he explained that the financial crises would have been much worse if the New Deals Federal Deposit Insurance Corporation had not insured most bank deposits and older Americans would have felt much more insecure without Social Security . Libertarian economist Milton Friedman after 1960 attacked Social Security from a free market view stating that it had created welfare dependency . </P>

What impact did the new deal have on america