Sunday, October 12, 2008

Sunday Tubing on the Googlenets

So there's been a LOT of shit flying from the fan blades about our present economic nosedive, some of which has come from me. There's been talk about the refuckyoucan deregulation that's taken our banking laws back to the free wheeling days of the 1920s. We all know what happened in the 30s.

Something that doesn't get talked about too much, by comparison, is The Panic of 1873, or The Long Depression. Enter and the following entry:

Like the Great Depression, the Long Depression saw many nations of the world resort to protectionism to shore up faltering industries. Influenced by List's nationalist argument for industrial protection, Bismarck abandoned the German free trade policy in 1879, enacting tariffs over the objections of his National Liberal Party allies. France, which had adopted free trade during the Second Empire (1852-1870), also abandoned it, while Benjamin Harrison won the 1888 US presidential election on a protectionist ticket. Only the United Kingdom retained the low tariffs enacted in the 1846 repeal of the Corn Laws.

Free trade vs protectionism/tariffs. That's the battle we hear about now. The refucks keep pushing for free trade, and self regulating markets and industries. Progressives like Thom Hartmann preach the values of tariffs and protectionism.

As I wrote recently, we've been here before. It's absolutely no mystery as to the cause of this situation, and it's absolutely no mystery as to the solutions. The thing is that when I was thinking about that post, all I had in mind was the Great Depression. I had a sneaking suspicion that many of the same factors were at work during The Panic, but I wasn't sure as to the date or the specifics. But there's even more to it than similar causes. Remember the PNAC's call for a new era of American Imperialism?

The Long Depression also contributed to the revival of colonialism leading to the New Imperialism period, symbolized by the scramble for Africa, as the western powers sought new markets for their goods. According to Hannah Arendt's The Origins of Totalitarianism (1951), the "unlimited expansion of power" followed the "unlimited expansion of capital".

Gee whiz. Only difference now is, that we have no products to market anymore; all our shit's made in China. We don't produce; we only consume.

The similarities are schpooky. Right now, we have a refuckyoucan preznit Bush. Prior to the Great Depression, we had a string of Republicans culminating with Herbert Hoover. At the time of The Panic we had Ulysses S Grant. As an aside, my sister and I have had discussions as to the magnitude of the ineptitude of Dubya. Whether a hobby or an avocation, it seems a fair bit of Conservative focus time is spent on arguing that Dubya is not the worst president in history. Among those name mentioned, besides Warren Harding and James Buchanan, is US Grant. Take a gander:

A failure as a farmer and a businessman, Grant soared to fame during the Civil War as President Abraham Lincoln's choice as commander of the Union Armies (from 1864). After the war, Grant was easily elected to two terms as President, but his administration was tainted by corruption among his Cabinet members.

Failure and corruption. My oh my. Anyone besides me NOT surprised? The biggest difference as I see it is that in Grant we had a general who actually served on the battlefield. In Dubya we have Cummander Codpiece; drunk and AWOL. Let's see... what else we got...

It was precipitated by the bankruptcy of the Philadelphia banking firm Jay Cooke and Company on September 18, 1873 along with the meltdown on May 9, 1873, of the Vienna Stock Exchange...

At the end of the Civil War, there was a boom in railroad construction, with 35,000 miles (56,000 km) of new track laid across the country between 1866 and 1873. The railroad industry, at the time the nation's largest employer outside of agriculture, involved large amounts of money and risk. A large infusion of cash from speculators caused abnormal growth in the industry. Cooke's firm, like many others, was invested heavily in the railroads...

Cooke and other entrepreneurs had planned to build a second transcontinental railroad, called the Northern Pacific Railway. Cooke's firm provided the financing. But on September 18, the firm realized it had become overextended and declared bankruptcy.

The firm's bankruptcy created a domino effect, causing major upset to the economy of the United States. The New York Stock Exchange closed for 10 days. Of the country's 364 railroads, 89 went bankrupt. A total of 18,000 businesses failed between 1873 and 1875. Unemployment reached 14% by 1876...

Oh... 'scuse me. We haven't closed the stock exchange. Yet. We just watch it decline by what... 22% in a week? We have banks going tits up, nine straight months of job loss... and a HOUSING BUBBLE that's burst. Let me back up a sec. What about Britain who hung on to their free trade policies?

The United Kingdom is often considered to have been the hardest hit by the Long Depression, and during this period it lost much of its large industrial lead over the economies of Continental Europe.

OK. So much for McSame's proposals of "Opening up markets for our goods (that we no longer make) and not going back to the failed policies of protectionism."

Remember the New Imperialism and period of unlimited expansion of power I quoted earlier? How about this, again from

Many economists believed the Great Depression was evidence that capitalism, when left unchecked, is a dangerous ideology. This caused some nations to change their political structures, such as Germany (and Italy), who adopted fascism.

Although I firmly believe that unregulated, unrestrained capitalism is dangerous, I think it's too early to gloat over the death of conservatism and/or the refuckyoucans. But we can dream.

A few last thoughts, and then you can go plug terms in to your own favorite search engine / tube scrubber. There seems to be disagreement over whether it was the New Deal that brought us out of the Great Depression, or World War II. Roosevelt chose public works to get people working again, Hitler, Mussolini and Tojo it appears, chose military buildup instead. Did WWII start with Italy's invasion of Ethiopia? Japan's invasion of China? or Manchuria? Or with Germany's invasion of Poland? Or is the answer none of the above? ??? Can't forget the Spanish Civil War that involved several of the big players in WWII using that theater as their laboratory.

Looking a bit further back, after The Panic, we had The Spanish American War, the Russo-Japanese War, the Boer War (maybe a few others) and eventually WWI. Again: When did it begin? ???

And looking forward, we've got Dubya's great experiment of Iraq. Who the fuck knows anymore, if anyone ever did, when and why that fiasco started and no one has a fucking clue when it's going to end. That includes McCain the Insane. And Afghanistan, and possibly more crap in Georgia and other ex-soviet republics, and Iran, North Korea, the Israeli-Palestinian conflict(s).

::Sigh:: I'm pretty tired. I think I'll go...


Anonymous said...

The patterns are pretty startling.

Chris in Seattle said...

Yeah. I had suspected, but was still surprised when I got reading and thinking.

I'm not sure if I got into it or not, but there's some disagreement over whether or not it was technically a depression in 1873. There was deflation, but there was supposedly also growth. I guess there's the idea that it was more a realignment due to the Industrial Revolution.

Anonymous said...


Chris in Seattle said...

Hi Zoey. or is it me there? Either way, you have an interesting blog. Do you do the illustrations yourself? They're very good.