When I was 7 years old my grandmother mentioned something she called, “The Great Depression.” It sounded ominous. It was great, it was a depression and my grandmother was, as far as I knew, omnipotent. Her words were weighty and I listened because she made it sound important.
“What’s a depression?” I asked.
“The Great Depression happened because just a few people had all the money and most people had nothing. The stores closed. No one could buy anything.”
A picture formed in my mind. I imagined fat men with gray coats sitting on mounds of green dollars yelling down, “You can’t have any of that. It’s mine.”
I pondered. Why didn’t people have money? We had been to Sears that morning and now I owned a plastic tank, some soldiers and a bag of white chocolate. It took money to pay for those things. What would it be like to have no money, no toys and no chocolate? I tagged along behind her as she cleaned house. “Where were you during the depression?”
She paused, her mind clicking away in time the vacuum. She shrugged a shoulder and continued, “I lived on a farm. We had eggs, butter, milk and meat. But we didn’t have enough money to buy shoes or tires. We made our own clothes. We traded. The people in the city were much worse off. They suffered.”
The world she painted became more abstract. “You traded eggs for shoes?”
She nodded, continuing her house work, vacuuming.
“Why was it worse in the city?”
“On the farm we had food. We had a garden, we canned food too. In the city, they had soup lines or sometimes nothing. They slept in cardboard on the street. They depended on others because there were no jobs and they had no way to earn a living.” The vacuum cleaner turned this way and that, then paused. “They lived in Hoovervilles, tent cities. Very dirty.” She and the vacuum continued.
“What did grandpa do?” I hollered, my words competing with the echo of the vacuum in the hall.
The handle clicked in place and she pushed the power button to off with her shoe, the hall cleaned. “Grandpa worked on the farm at night and during the day he drove a team of horses. The team pulled a shale wagon. He made fifty cents a day and worked 7 days a week.”
I had been to Oklahoma. I imagined what it must have been like to breath in the red dust on a hot sultry day. Miserable! It suddenly struck me. I glanced into the family room at a plastic toy tank and soldiers resting on the sofa. Certainly the fudge was close to fifty cents. The toy was at least a dollar.
“Back then, fifty cents was worth a lot more,” I exclaimed. It was something I had heard repeated at the dinner table often. I felt better about the toy expenditure.
She wagged her head. “Fifty cents wasn’t much back then either. If we hadn’t lived with my mother we would have starved.”
“Why did Grandpa do that job?” I asked, feeling guilty. I had used several day’s wages.
She breathed deep. “There were 50 men who waited by the fence row each day to take that job. It was a hard world in those days. If you complained you starved. People took what they could get and thanked those that mistreated ‘em. There weren’t any jobs because there wasn’t any money.”
I didn’t understand everything she was saying, but one point was clear: I was happy that I didn’t live back then.
“Don’t worry,” she said, seeing my alarm. “Roosevelt saved us. He was our hero. We listened to his radio broadcasts and he made everything seem like it was going to be okay. He took care of the workin’ people and eventually, he fixed things, but it took a many years.”
The house was clean.
It’s been 46 years since I had that conversation, yet I remember it as if it were yesterday. Maybe I had a premonition, or maybe it was because my grandmother was so serious that I knew I should pay attention.
I graduated from Arizona State and hold degrees in economics, marketing and business management. From an economic perspective I understand how market forces work. With a chalkboard and a semester, I could teach how supply side economics and shifts in taxation have turned our country to rubble.
But few listen to that type of dialog because most people have been told those are lies. The banter is endless.
So I come back to that moment in time when my grandmother explained to me what happened during the Great Depression.
A few people had all the money and most people had nothing.
She had explained it perfectly.
Today we see a coming storm – one that should seem familiar. I think back to my conversation with my grandmother because I see a mirror image. The top 10% of earners take home 64% of the income. Between 1979 and today, 38% of all income growth occurred in the top 1%. Today, wealth distribution is identical to 1929. There is no doubt; money is being concentrated into the hands of a few.
But I don’t want to talk about those numbers because they don’t paint a real image in the minds of regular people. Regular folks have been talked into believing that if they simply work harder, give up more and ask for less they will be spared a life of poverty. It is a message on an endless loop, paid for by people who will never be satisfied until every player lands on a hotel and the Monopoly game is over.
History dictates exactly what will happen. Like the law of supply and demand, the economic phenomenon is perfectly predictable. The outcome is absolute. There is but a single result.
When the House of Representatives is returned to the Republicans in November, the agenda will be to remove Obama and retain hold on the executive as was the case from 2000 to 2006 and arguably 2008, with one difference: The economy is significantly weaker than it was in 2000.
They will likely achieve their goal. In their wake of blind greed and ignorance our nation will be left at the precipice of the next Great Depression.
The income and wealth gap are ripe and ready to fall from our overburdened economic tree, not from spending – but from the money that has been hoarded. The economy teeters on the brink. They push it toward the edge. We feebly push it back, not wanting to incur the wrath of the other side. The storm is perfect.
They are indeed sitting in gray suites on hills of green dollars yelling to us, “You can’t have any of that!”
Few will be spared. Those with assets will see everything evaporate. Those who are leveraged will walk away from their equity. Our “illegal immigration” trouble will be cured as immigrants escape back across our border. We will watch with envy as they depart our impoverished country.
The elderly will be hit the hardest. Arguments will arise that since prices are depressed; Social Security has failed and should be cut. That debate has already started.
In light of the worsening poll numbers, I would like to invoke the wisdom of my grandmother who graduated with honors from the school of common sense. Raised on a farm, the mother of two successful children and many grandchildren, she would state the following:
1. Leopards don’t change their spots.
2. Don’t cut your nose off to spite your face.
3. Those who don’t learn from history are doomed to repeat it.
Granting control back to those who left the economy in shambles defies logic, unless you believe they have a different strategy (see point 1).
For those who are angry because we haven’t recovered fast enough (see point 2).
For everyone else, see point 3.