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10
tragedy. A worldwide nnancial calamity
spread from America in 1929 in domino
fashion. The crunch began in Austria,
May 1931, with the bankruptcy of their
largest prívate bank, the Credit-Anstalt.
The 1inancial epidemic spread to Ger–
many by July 1931, with the dosing of
all German banks and credit institu–
tions. At this point Germany ceased to
have a banking system.
Next, Britain began to suffer the
strain of the Depression. Its first effect
was to bring the faU of the
Labour Government, fol–
lowed by devaluation of
the pound and the aban–
donment of gold in Sep–
tember 1931. Like a Death
Angel, the Depression
passed over country after
country, spreading economic
downfaU.
The Invisible Scar
Perhaps a greater curse
than the immediate Depres–
sion itself was the long–
range effects - the "invisi–
ble scars."
Those who lived through
the Depression have experi–
enced want, poverty, desti–
tution, frustration, hunger,
pain, loneliness, and despair
such as the younger three
fourths of today's affiuent
nations cannot imagine -
the kind of poverty many
of the under-developed na–
tions Jive in today. They
suffered poverty not for a
day,
but for up to a
decade.
One fourth of all American workmen
were unemployed, another one fourth
severely underemployed (earning per–
haps five cents an hour for two or three
days a week). The "employed half"
who
barely
made ends meet helped to
support friends and relatives who were
evicted or jobless.
When those who grew up during the
Depression became parents, in the For–
ties and Fifties, they had a burning
desire to give their children the
seCJ(rity
whicb
they
never knew as children.
One authority made this incisive
observation :
"A new generation grew up who
The
PLAJN TRUTH
knew nothing of depression. All they
could see of it was the
q11iet anxiety
that seemed to flicker permanently in
their parents' eyes: the overwhelming
desire for 'security' at almost any price
displayed by those who had known the
thirties" (Robert Goldston,
The Great
Depression,
fawcett Books, 1968, page
240).
The "oldsters" stiU live under the
shadow of the Depression. The "young–
sters," often represented by the growing
hippie and near-hippie culture, say,
"Our folks want to sell us financial
security, but we don't buy it. We want a
world of love, not money."
So the generation gap - the worst of
the invisible scars - finds deep roots
in
the Great Depression, the scramble for
financia! security, the overspoiling of
today's leisured youth.
Many such
elfectJ
of the Great
Depression are still felt. But cven more
sobering is the fact that many
BASJC
CAUSES
of the depression are still with
us. In fact, the similarities between tbe
1920's - preceding tbe Great Depres-
Decembec l970
sion- and the 1960's are surprising.
So great are these similarities that
sorne have wondered: "Could the De–
pression happen
again?"
Since the United States recently suf–
fered its worst stock market decline
since 1938, worst unemployment since
1961 (Britain and Canada are experi–
encing their largest numerical unemploy–
ment since 1939), few questions could
be more vital than this one to our own
immediate future.
Overlooked Similarities
Notice how and why the
Roaring Twenties and Soar–
ing Sixties are disturbingly
similar.
Severe recessions in 1920-
21
and 1960-61 were fol·
lowed in both cases by eight
ycars of plenty, prosperity,
and progress.
In July 1929 and
July
1969, industrial production
began to decline. In October
1929 and October 1969,
stocks began to fall rapidly.
Stocks declined a greater
percentage in 1929 than in
1969,
but in the recent
decline
fotlr timeJ
the
amount of
money
was lost
on the stock markct as dur–
ing the
ENTIRE
Depression.
During 1930, and 1970,
economists predicted that
this was only a temporary
"adjustment," relicf was in
sight, and "a severe depres–
sion is outside the range of
possibility." In 1930, virtu–
ally no one classified the slump as a
depression.
In June 1930, the famous Hawley·
Smoot tariff barriers were erected. In
July 1970, the U. S. broke a 37-year
policy of free trade to propose tariffs
once again - this time against foreign
textiles and shoes.
Of course, the similarity of dates is
just mere coincidence. But the under–
lying factors in the United States of the
Twenties and Sixties go much deeper.
"Then As Now"
In an addrcss at Columbia University
in June 1965, the former Chairman of