Eighty years ago today on "Black Tuesday," the stock market collapsed, ushering in the worst economic slump in American history. The 1930s were a national nightmare"”an era of great suffering, smashed dreams, and wasted opportunities.
What we often forget when we think about the Depression, however, is that at several points the contemporary equivalent of "green shoots" led many to believe that the gloom had passed. A recently published economic journal of the period"”The Great Depression: A Diary"”reminds us just how wrongheaded predictions of prosperity can be, a sobering lesson for today.
For nearly two-and-a-half years, from September 1934 to February 1937, the Dow Jones Industrial Average climbed steadily with nearly no disruptions. (You can see historic prices here.) After watching this recovery closely on a daily basis, Benjamin Roth, a lawyer living in Youngstown, Ohio, wrote in his personal diary on Jan. 2, 1937: "We can formally and officially announce that the depression of 1929 has ended." Roth was no cockeyed optimist; he was echoing what economic experts across the country were saying. And he could see signs of prosperity all around him: The region's steel mills were back at near-full capacity, his neighbors were buying new cars, and the owner of a local dress shop told Roth that 1936 had been his biggest Christmas season ever.
Still, it didn't all add up for him. "It is hard to understand why," Roth wrote, "in the face of all this seeming prosperity, there are still about 8 million unemployed in the U.S."
And so it is today. We see the ostensible signs of recovery: a relatively buoyant stock market, consumer confidence much improved from the beginning of the year, and a return to profitability for many large banks and corporations. Yet we endure the highest unemployment in a generation, and lack any clear sense of how we will revive our economy. The results of government stimulus spending are difficult to quantify, leading some economists to say that they have no effect at all. And even the most ardent proponents of stimulus spending agree that we must eventually confront our staggering national debt.
Indeed, reading about the false hopes from the Depression forces us to confront the buried, throbbing sensation that tells us that no matter how prosperous or lucky or cunning the American economy has been for the last century, we still don't have definitive, universal answers to some very fundamental economic questions, large and small, that puzzled our fathers and grandfathers. How much debt is too much debt"”for a household, a company, or a government? How much can government prop up private enterprise without creating a moral hazard that hinders market dynamism? Why can't economies continue to expand at a steady manageable pace, without lapsing into destructive boom-and-bust cycles?
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With the official jobless rate for Black male workers still exceeding 16.5 percent in September 2009, the U.S. Mass Media's recent assertions that the U.S. economic depression of 2007-2009 has magically ended seems to reflect the level of media racism and media classism that still exists within the world of the Big Media Monopoly.
Coincidentally, the level of institutional racism within the world of U.S. elite university economics departments is apparently even greater than the degree of institutional racism within the U.S. mass media world. According to an article, titled "Almost No Black Economists at the Nation's Highest-Ranked Universities," that was posted on The Journal of Blacks in Higher Education website in 2006, only 15 of the 935 economics department faculty members at the 30 highest-ranked universities in the United States are black; and these 15 black economists only "make up 1.6 percent of all the total faculty in the economics departments" of these 30 elite U.S. universities.
Perhaps if the economics departments of U.S. elite universities were compelled to hire more labor-oriented African-American economists, the U.S. mass media would finally be able to locate some economists who might actually understand what is actually required to finally create a prosperous, full-employment, leisure-oriented economic democracy in the United States in 2010.
Yes, the continuing levels of unemployment--for all categories of workers, but particularly for African-Americans--is clearly unacceptable.
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