Our readers write: Is it 1929 yet?

Our October issue featured the story “Behind the Econocataclysm: Globalization, Oil Shock and the Iraq War” by Vilosh Vinograd, citing George Soros, Joseph Stiglitz and Walden Bello to argue that the financial crisis was sparked by George Bush’s imperialist aggression in the Middle East. Our October Exit Poll was: “Is it 1929 yet?” We received the following responses:

An informed if apocalyptic view from Joe Wetmore of Autumn Leaves Used Books in Ithaca, NY:

I’ve been reading The Great Crash 1929 by John Kenneth Galbraith. I’d have to say, there are a lot more parallels with today’s crisis than I would have thought.

All the same mistakes: a housing bubble, leveraged financial securities, banks and securities firms merged together, lax regulation of the market, etc. all combined to make the perfect storm.

My prediction is that we have not seen the worst. That will happen when Citibank goes under. No one will be big enough to buy it. The government does not have the funds to prop it up. And it will crash the domestic banking system. All those branches, closed. All those CC frozen. It is leveraged with all kinds of joint deals with other banks and financial institutions. A huge part of our economy will stop. That will be Black Friday.

Only this time we do not have the industrial base to recover. The idle factories are not here, but in China. Part of the craziness of the last few decades is to revert our economy from hard goods to derivatives and Disney. In other words, all the US produces for the world economy is financial instruments and entertainment. It’s not just a matter of the Government placing orders to the factories to get them up again, we have to build the factories too.

With the coming of peak oil, that is not such an easy task. The industrial revolution came about, in large part, by the discovery and harnessing of cheap energy. Now that we’ve used the cheap energy up, those factories are going to be even harder to recreate.

Welcome to the third world.

World War 4 Report replies: We will point out that the price of oil is dropping at the moment. Tho who knows how long that will last…?

From Suzy Subways in Philadelphia, PA:

is it 2001 Argentina yet?

¡Que se vayan todos!

World War 4 Report replies: ¡Ojalá!

From Margery Coffey in Rosalie, Nebraska:

We went to 1929 when King W was elected. While the super rich argue as to whether or not we are on the edge of a recession, the rest of us know we are in a big depression and it ain’t gonna get any better by giving the rich welfare.

World War 4 Report replies: It isn’t 1929 yet. Millions haven’t been thrown out of work. The banks haven’t closed. The skyscrapers are still going up here in New York. They’ve been shifting the burdens of the crisis that began with the 1970s oil shocks downward ever since Reagan. With luck, we are now witnessing the overturn of the Reagan revolution, and we can start redistributing the burden a little.

From Dennis Watts in Torrance, California:

It looks to me like we are headed for a serious recession. I don’t think it will reach Depression figures; it won’t be pretty. Reaganomics has proved to be a failure for Main Street; now Wall Street is feeling the heat. Family-owned businesses dropped like flies after ’87 (I was one of them). Now we see the conglomerate corporations getting their taste.

The powers that be refuse to acknowledge that we are in another Vietnam situation. Read the histories of both conflicts, from every side, it’s all the same. Shame on us.

Then this wasteful expense of the border-wall. What can you say? Corruption! Stupidity! Racism!

Now we want to revive our Cold War posture. Instead of reaching out to Russia, Cuba, etc…, we antagonize and strut our stuff. Careful. Again read your 20th century history books. We are traveling down a road that has deep grooves in it, from countries that used to be, or are, against democracy and the USA.

Electing Obama may not be a panacea, but it’s a 1st step in the right direction.

World War 4 Report replies: We mostly share your sentiments, but object to your promiscuous use of the pronoun we.

From Donovan Ritch, somewhere in Canada:

No, not yet. It’s interesting though, I had a professor of mine give a lecture on the global financial system last year. He labelled it a “casino economy”. Well, it looks like the house has won. I wonder though, who might this “house” be?? Maybe those on the receiving end of the 700 billion + benefits?

World War 4 Report replies: We are not sure the bailout is a wealth-redistribution scam. Marxist economist Andrew Kliman argues that the crisis is Worse Than They Want You to Think, and that the new state intervention is Trying to Save Capitalism from Itself. Check ’em out.

See our last post on the econocataclysm, and our last Exit Poll results.

  1. A late response…
    …from JG in New York City:

    1929 is about right. The difference is that there are global changes afoot which means how it plays out isn’t predictable. On a tactical level, it seems right now that the ‘powers that be’ have saved the international banking system from 1931. The cost of this will be declining standards of living across the US over the next four years.

    Counter intuitively, though not on this site, economic slow down might actually be a ‘good’ thing. Slowing down globalization in its (our) headlong rush toward ecological shift (read: disaster) would be a totally unintended plus. More than likely too little too late but we shall see.

    Now tell the truth. Do you cheer when Wall Street goes down? Even on a day to day level?

    World War 4 Report‘s Bill Weinberg replies: Assuming this question is addressed to me personally… I confess to following this Fall’s stock market plunge with mixed emotions. On one hand, a crash will obviously mean lots of human suffering. But oil consumption, already depressed due to high prices, has continued to decline along with the Dow Jones. A crash could mean salvation for threatened uncontacted peoples in the Amazon. It could prompt the “crash conversion from the oil economy and a return to self-sufficiency, localization and the human scale” (as Vilosh put it). It could halt the damn skyscraper that is going up across the street from me. It may be the only thing that can save the planet.

    As for “not on this site”—I will point out that World War 4 Report‘s hits are way up this month.

    1. hits good. need more
      I meant that on this site the declining economy being a potentially good thing is not counter intuitive. See … uh .. your comments above.

      > It could halt the damn skyscraper that is going up across the street from me.

      Halt, no, might slow.

      > On one hand, a crash will obviously mean lots of human suffering.

      One guesses international hunger relief is at the back of the bailout line.

      I personally was overjoyed by the stock market crash exclusively having to do with Nov 4th. It really, as they say, changed the narrative and wiped out a lot of retirement savings. That’s gonna swing some votes. Also the bubble was going to burst and if they’d kept it going until next March the conservatives would have blamed the liberals, the libruls, the liberal terrorists and gay marriage. And gotten away with it.