V21-08

Official Solution:


During the 1930s, Roosevelt’s New Deal expanded federal authority by creating several new government agencies designed to administer financial relief to the country, which had been devastated by the 1929 stock market crash and the ensuing economic depression. In the decades following the depression, however, policymakers grew uncomfortable with the amount of power that had been given to the federal government and sought to discontinue many of the agencies created under the New Deal. Many prominent economists of that time sided with those policymakers, since ____________________.

Which of the following most logically completes the argument?


A. further expansion of federal authority would hinder economic growth and increase the risk of another economic depression.
B. many agencies created under the New Deal were designed to provide financial relief, not to maintain economic stability.
C. most Americans feared expansion of federal authority more than they feared another economic depression.
D. the power and authority of many agencies created under the New Deal had expanded well beyond the limits defined in their respective agency charters.
E. most policymakers of that time considered federal regulation of the market to be an emergency measure that, as such, should only be temporary.


The conclusion is that "many prominent economists of that time sided with those policymakers", implying that the economists, like the policymakers, "grew uncomfortable with the amount of power that had been given to the federal government and sought to discontinue many of the agencies created under the New Deal." How do we arrive at that conclusion

The agencies created under the New Deal were designed to administer financial relief to the country DURING an economic depression

AFTER the economic depression ("in the decades following the depression"), economists and policymakers were more concerned with the amount of power those agencies had given to the federal government than with the administration of financial relief... why

If the agencies administering financial relief are useful in preventing an economic depression, we wouldn't expect the economists to want to discontinue those agencies

However, if those agencies are only useful in helping to end an economic depression and not necessarily in preventing a new economic depression, then the economists' desire to discontinue those agencies AFTER the depression makes sense

(A) According to this statement, FURTHER expansion of federal authority would increase the risk of another economic depression. This answer choice is tempting because we know that the economists feared another recession. But the policymakers and economists wanted to DISCONTINUE many of the New Deal agencies, not just prevent further expansion of federal authority. Choice (A) does not explain why the economists want to REDUCE the level of federal authority, so we can eliminate (A)

(B) We are told that the policymakers and economists wanted to discontinue many of the New Deal agencies AFTER the economic depression, not during the depression. If the agencies administering financial relief are useful in preventing an economic depression, we wouldn't expect the economists to want to discontinue those agencies. However, choice (B) tells us that those agencies were designed only to provide financial relief (i.e. DURING an economic depression), not to maintain economic stability (i.e. AFTER an economic depression). This statement explains the economists' point of view, so let's hang on to choice (B)

(C) This statement tells us how "most americans" felt but does not explain the point of view of the economists, so choice (C) can be eliminated

(D) The power and authority of the government agencies exceeded the limits defined when those agencies were created, but is that necessarily a bad thing? This information only tells us that the power of those agencies expanded but does not explain WHY economists grew uncomfortable with that expansion of power. Furthermore, choice (D) does not explain why the economists would want to get rid of agencies that are seemingly designed to combat economic depressions. We can eliminate choice (D

(E) This choice explains why the policymakers wanted to discontinue the New Deal agencies, but it does not explain why the economists wanted to do so. Choice (E) can be eliminated


Answer: B