Friday, March 19, 2010

The Waiting Game

In looking back at the Great Depression of 1929 we are told that everything went to hell in a hand basket that October and stretched out for a decade until World war two broke out and the economy was saved by the need to produce materiel to kill the armies of the Axis. Along the way leftists like me praise FDR for overcoming the opposition and starting the Works Progress Administration and putting Americans to work. Revisionists (the bad guys as it were...) say the WPA and the New Deal only papered over the problems and never actually fixed anything. If you look at the details of the lost decade there was a great deal of misery and a great deal of support from the people for their champion, President Roosevelt. Economists who look at the minutiae of the government's decision making at the time will criticize this approach or that approach but when we look back from here we see a unified approach to problem solving that perhaps was not really there at the time. One of the starkest reminders of how hard the Depression really was comes when you talk to a survivor. They were a stoic generation and they won't say much (unlike Baby Boomers!) about their feelings but they were all marked by the experience of surviving their economic crash. The stories of survivors hoarding food, living frugally, saving money obsessively are legion. The history books may tell us breezily the Depression saw 25 percent unemployment and plummeting living standards all brought to a close by the War but that sort of abbreviated history doesn't tell it like it was. Our parents and grandparents suffered torments that stayed with them for the rest of their lives.Europeans are being warned by some of their leaders that life in the near term is going to get much bleaker. The Bank of England has announced living standards will plummet in the years ahead. The French government faces the unenviable task of telling their population the same. The French, unlike Americans, don't take kindly to being told they are going to pay for the sins of the wealthy and the french government is fiddling around trying to figure out how to break the news gently. meanwhile Germany has still not made up it's mind what form the Greek bailout will take and Greeks have been throwing Molotov cocktails in an effort to spur their leaders into action. The sad part is that the spending and borrowing of the past three decades are coming to a head. And Europeans, cocooned by a welfare state that would would Americans' eyes water, is starting to crumble.In the United States we have yet to hear the message that the shit is hitting the fan. Our leaders tell us we have an economy starting to rebound, unemployment isn't getting worse at the same rate as last year etc etc... Yet on the ground it is obvious things aren't getting better. States are going bankrupt as must be obvious to anyone living in California, Illinois, New Jersey and Michigan among others. The gloomy economists on the sidelines are filling in for our absent leaders and they promise a future filled with hardship. Social services will be cut, arts programs will go, public facilities will be closed, pension payments will be delayed, hospitals will close, police response times will be longer. Stores are going to close, foreclosures will increase, energy will cost more, wages for the employed will stagnate and the younger generation will refuse to subsidize the retirements of those of us ready to leave the workforce.


In the face of the gloomy prognostications there is a sense of fatalism that creeps into my mind, the sort of paralysed helplessness that one sees in a wild animal caught in the headlights. From my vantage point life goes on as normal. We work, we pay our mortgage, I show up to work, the building is air conditioned to an extravagant degree. The city of Key West is starting to look at the next budget cycle and there is no word so far of wild cuts, layoffs or major changes. Tourists cram the streets of the city, and of all Florida destinations the Florida Keys are proving to be the most resilient. Tourism is up this year over recent years and while room rates have dropped the rooms are still filling up in Keys hotels and guest houses.Sitting here now, sheltered, fed and employed I wonder what the future might bring. It's hard to square the apocalyptic visions brought to us by Moody's and the Bank of England. My colleagues go about their work and their lives shopping online planning vacations, eating out. I can't make up my mind if they are smart lucky or foolish. Me? I vacillate between hoarding and spending, with my wife putting on the brakes when she feels down and letting go when she decides to feel hopeful. We've scrapped plans to go to Europe this summer, our tilt at the windmill of frugality, planning instead a road trip with a dog and a tent, Okie style, possibly to New England, cheaper and closer to home. Not exactly frugal but not exactly extravagant either.


It seems inevitable that something has to give. It may very well be ordinary daily life but I do not propose to retreat to a Montana fortress, even if I had one, to ride out the coming storm. There is a part of me that hopes that if living standards are going to drop, as seems likely, that in some respects life may actually get better. I will undoubtedly miss the modern conveniences , cheap and readily available, but it wouldn't be human if, in exchange some good didn't come out of a new way of life. Dread mixed with an intriguing sense of the possibilities. Perhaps I am an optimist deep down.

8 comments:

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Anonymous said...

Politicians are elected and re-elected on promises of giving away the treasury - not an austerity platform. We've gotten exactly what we've voted for in this country. Everyones "right" to free (fill in the blank here:______ ) has to paid for somehow.... implied, of course, that the 'someone' is someone ELSE...

Singing to Jeffrey's Tune said...
This comment has been removed by the author.
Singing to Jeffrey's Tune said...

Damn, when you shift through the ramblings, I was saying:

Social contracts are based on mutual cooperation for the aggregate benefit of all, or at least the perception of aggregate benefit. Once the benefit (or perception) is removed, the system will breakdown. Markets are one of the truest forms of this.

Conchscooter said...

It must be disconcerting to see the electorate unwilling to vote for people who tell them truths they don't want to hear. We appear to be backed into a corner. I wonder what happens next?
The benefit of all is a concept that has not been sold very well on the health care refomr issue!

Singing to Jeffrey's Tune said...

I suspect that is because the benefit for all was either not there, or perceived to be not there. I heard from many, honest, god fearing, republican, working folk (with medical benefits from their employers up until recently) squawk, "why should they pay for everyone else". I wonder if it was the benefit for all or the benefit for the many?

We could swing the other way to privatize everything and those that can back their currency with hard good, can issue it. Which would mean the government cannot. Liberator-ism perhaps? Oh wait. It might already be there with a thin veil of government?

My guess is it is neither, but some where in the middle.

Singing to Jeffrey's Tune said...

And I meant Liberator-ism as a joke to Libertarianism. Everything I learned about that was from wikipedia and a comic book: http://www.bigheadpress.com/tpbtgn

I think the truth is more complicated once societies get large, and they don't change. The same politics now happened in Roman, and they will happen on Mars. If you are lucky to live in one of the the good time cycles, be thankful. If you live in a down trough, survive.

Anonymous said...

Run the presses boys! Free (whatever) for everyone! Agentina was a fluke! Won't happen to us - we're "The Richest Country In The World!"