Looking For Context

There are little clues in each day's allocation of bad news on the economy. They allow for interpretation of the date in terms of degree of badness. While we hear the daily bleating from the administration about the end of civilization as we know it (excuse the cliche), maybe the warnings of imminent demise are over-blown. Is it possible that the degree of the "crisis" needs to be evaluated with a bit less hysteria?

Consider the plummeting of the Dow-Jones in response to the Obama spending. In terms of my 401(k), it is significant. The impact on retirement can't be ignored. The market is way down and setting new records for decline daily. How low has it gone? Friday's close was the lowest since 1997! Wait, this isn't the Great Depression level? It's the lowest in less than 12 years. Just that short period, not a millenium. It was lower than this low during the second term of the Clinton administration! Does that add some perspective?

Or, how about unemployment? You might question the raw numbers of the DJ Index as not corrected for inflation, but if you look at unemployment stats, they are a percentage of the work force, not a raw number. How bad? 8.1% jobless. Is this 1931 breadlines stuff? Hoover-ville in the railroad switching yard? How about joblessness as high as it was in 1982, the first full year of the Reagan recovery from the disasterous Carter years. Then it dropped to 11.1%. We've got a way to go.

I remember 1982. I had returned from almost 10 years out of the country--one year in Thailand, four in Spain, three in Germany (and less than a year in Alabama going to school.) I was in Alamogordo NM, and I read two newspapers a day, listened to talk radio and watched TV news. I don't recall any bleating, wailing or even noticeable impact from the high unemployment. Certainly if you are the guy without a job, you suffer. But there wasn't a continuous caterwauling from the President about catastrophe looming. It was largely a momentarily blip in America's continued success. We recovered without much notice.

Will it happen this time? The wild card is the response of the government, which is excessive to put it mildly. The indoctrination of the nation in the politics of failure and the dependence upon only government to get us back on track might be the difference from previous downturns. Is increased governmental interference (AKA "regulation") the answer? Is nationalization of banks, auto-production, energy sources and home financing good for us in the long run?

Dark days lie ahead, but maybe if we watch for hints of context we might change our view of our existance.