I know that for many it seems like our troubles today are unique and worse than recent memory, and for those who are out of work, today is bad, no doubt. But for perspective it can be helpful today to read books and articles from other tough periods in human history. The 60's and 70's for example, were similar to today in many ways: deleveraging economy, over-indebted people and economies, OPEC Oil Crisis, Watergate, Viet Nam, social dis-ease.
Before the 60’s, the late 40's and 1950's were a period of remarkable growth and prosperity in North America. Not having to dig itself out of post-war rubble was an advantage that North America had over Europe and Japan. America was the industrial power best equipped to help the world rebuild after the war. It brought in the GI Bill to offer affordable housing and post-secondary education programs to its war vets. Everyone was buying houses, raising families and spending money. And then after this remarkable period of rejuvenation, came the usual suspects of over-capacity, inflation, over-indebtedness and the down side of up. Peter Bernstein was one of the big picture economic commentators writing about it in real time:
“It may be said that the pride of prosperity is resurgence of our sense of social indignation – social urgency – that poverty, filth, disease, or discrimination should exist anywhere in America or elsewhere. If we can recapture this passion for social justice that carried the nation to greatness in the past, we shall find that the price we must pay is but a small one indeed for the rewards it can bring to us and to our children.”
PETER L. BERNSTEIN, The Price of Prosperity, 1962
People generally get a whole lot humbler after the boom. The world gets scaled back down to a more practical model and we work away at the recovery. This is the normal course; the way our problems have always been solved over time.
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