Great Depression America or Russia Now: Which Would You Choose? - Econ Lessons [View all]

Hey Mark, an Economist has a question for you - If you had to choose between Great Depression America and Russia today, what would you choose? I pick America in the 1930s. Not because the Depression was easy, but because the economic structure still pointed toward a future you could invest your life in. This is an economic thought experiment: if you had a time machine.

In the 1930s, the U.S. suffered a massive contraction, but the country kept the core ingredients economists associate with long-run development: relatively strong property rights, institutional continuity, and a political system that could credibly change course through reform rather than coercion. That matters because living standards are not just what you consume this year. They are also the expected path of opportunity over the next 10 to 30 years. In growth terms, the Depression was a devastating shock inside a system still oriented toward productivity, innovation, and broad human-capital formation.

Now compare that to Russia today. Russia is operating under wartime political-economic conditions: resource allocation shifts toward defense, civilian sectors are crowded out, and uncertainty rises. Reuters and other reporting describe a war-driven economy paired with income strain and a “lost decade” dynamic, where growth narratives are decoupled from broad household gains. War also raises the everyday “risk premium” on life: uncertainty about policy, mobility, and the future. When a society becomes high-uncertainty, families rationally shorten their planning horizon, invest less, and focus on survival rather than advancement. That is not a mood. That is incentives.

Material life is also not automatically better just because it is modern. On housing: Depression-era American family homes were often modest but physically roomy by today’s urban-apartment standards. Historical housing series show that new single-family homes were roughly 1,100 sq ft (about 102 m²) in 1930, which is larger than what many families can afford in large Russian cities now. Russia’s average housing provision is often cited around the high-20s square meters per person, which sounds fine in aggregate, but averages hide the “two Russias” problem: modern metros versus small towns and villages with aging stock and limited services.

Then there is the demographic constraint, which economists treat as a core growth variable: labor supply, dependency ratios, and long-run fiscal pressure. Multiple analyses emphasize Russia’s aging trajectory, a large gender gap in life expectancy, and structural demographic headwinds. When demographics deteriorate in a war economy, it is not just “sad.” It is a binding macro constraint that manifests as labor shortages, weaker productivity growth, and lower momentum in living standards.

And yes, I’m talking about everyday life, not spreadsheets. For many immigrant families in Depression-era America, “poor” did not mean “hopeless.” If you had a small house, a garden, community networks, and a church, you had household resilience. In economic terms, that’s household production and social capital functioning as informal insurance. You could still see a path forward, and that expectation changes everything: how you work, how you learn, how you raise kids.

Russia today, under war and centralized control, feels like the opposite of an incentive structure: higher uncertainty, weaker credibility of long-term promises, and data harder to verify externally in a conflict environment. Even when consumption goods exist, the “investment climate for ordinary life” can be poor.

So this video is not nostalgia. It’s institutional and incentives-based economics.

My claim: Depression-era America was still a place where the future felt investable. Russia today, under war and demographic decline, is not.