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What the Past Teaches

Posted by Donna on October 8, 2008 at 8:28 am

With so much going on in the world of politics, finances and American legal structures, we’ve heard words such as “recession”, and even phrases like, “Well, back during the days of the Depression…” Hopefully, things won’t get this despondent. Contrary to what some may believe, I don’t think we’re anywhere near a depression. Maybe a series of “blue days” would be a more apt description, for now anyway.

Still, though, I was interested in comparing the days of the Depression and the years prior that some say is the true beginning of what culminated into a near-decade decline. For the sake of uniformity, I’m using a general “pre-1940″ as my comp point with specific years within each reference.

Pre-1940	2008
Suggested Causes of Decline/Depression was coined as: “The 3 Bs”: Bankers, Business, Brokers	Suggested Causes of Decline could coined as “The 3 Ms”: Money, Mortgage, Mismanagement
Those Living Below Poverty: 33% (1929)	Those Living Below Poverty: 12.5%
Unemployment Rates: 26.6% (1933)	Unemployment Rates: 6.1% (Analysts predict numbers near the 1933 rate of 26.6% if trends remain same)
Number of Banks Failed: 9,000	Number of Banks Failed (YTD 2008): 60 (Analysts predict potentially 90 more within next twelve months)
Human Toll: 11 well known Wall Street speculators suicide on Black Thursday, 1929. It was later discovered that a ticker glitch was at fault this particular day.	Human Toll: 90 year old woman attempts suicide due to foreclosure in October 2008 A man in California killed his family of five and then killed himself over financial problems and recent job loss.
Divorce Rates: Due to the legal costs of obtaining divorces, the rates dropped sharply; however, it’s estimated that nearly 1.5 million men abandoned their wives and children due to low self-worth and failure to provide for their families	Divorce Rates: No noticeable difference; divorce rates still hover near 50%
Catchphrases: Hooverville - Used to defined cardboard “shanty” towns built by homeless men to provide shelter	Catchphrases: Housing bubble burst - Result of high number of subprime mortgages facing foreclosure.
High School Dropout Rates - Surged to near 4 million at height of depression	High School Dropout Rates - Hovering near 9%, up only slightly from 2005

*All figures come from US Census Bureau and BLS/PPI Government site

Even though there are some similarities, when you take a step back, you begin to realize many of these comparisons are indicative of society throughout the decades. Divorce, even though the rates were down, is as evident now as it was in the 1970s. Dropout rates are actually a bit better than they were in the early 1980s. Murder rates weren’t really any higher in the late 20s through the early 30s. Of course, robbery and theft was up for obvious reasons. On the other hand, a depression is defined as:

Deep extended slump in total business activity. Buying and selling drop, forcing a decline in production prices, incomes and employment.

Again, that statement can be applicable to many times even within our lifetimes. So, as bleak as the political and financial fronts seem to be, it’s not as discouraging as some insist, especially the ones who declare the sky is falling.

My guess is burglary, petty theft and misdemeanor charges for things such as a lack of automobile insurance and expired tags will be on the increase. Hopefully, the winds of change will begin to shift sooner rather than later.