Global Economy No Longer Circling Drain; Now In Septic Tank
No, really. The International Monetary Fund said so this week (well… not in so many words, but the spirit of the language is really the same). The news actually came to me as something of an unnecessary bummer Thursday when I was trying to enjoy my print edition of the New York Times on my lunch break after being told hours earlier that a personal acquaintance of mine had eaten a gun Wednesday night…
So what had already become a shitty day got a lot worse when I read this headline on page two of the Business section: “Global Economy Called Worst Since 1945” (click here to see the electronic edition of that article). Thank the Great Magnet for sweet chiba. If it wasn’t for that shit, getting two doses of such bad news in the space of just a few hours might stress me out more than I could stand. But even a few safety meetings later I must admit I’m still a bit unnerved by the implications of both situations.
Never mind my private dramas though, dear Constant Reader. Just worry about the half of my shitty day that effects you too: we have managed to fuck up the global economic system so badly that it may not recover fully for years and we don’t even have a global war on which we can place the blame.
Olivier Blanchard of the I.M.F. said Wednesday that the global economy would likely contract by about 1.3 percent in 2009, which was down from their more optimistic projection (issued just this past January) of 0.5 percent growth. While 1.3 percent contraction in an economy as big as our planet’s might not seem like a big fucking deal, it actually is a big fucking deal… a really big fucking deal… because this would be the first year since 1945 that the global economy has contracted at all.
I’ll let that sink in for a minute…
Freaked out yet? Well if so just hold your horses… there’s more… Those numbers above encompass the global economy. Here at home in the United States, generally agreed upon as the center of the whole sad mess, economic contraction is predicted to be even worse: about 2.8 percent contraction in 2009 with no growth whatsoever predicted for the whole of 2010.
In the unemployment department, Blanchard of the I.M.F. predicted that world unemployment would peak at 7 percent this year, while the U.S. unemployment rate would likely rise to at least 10 percent before ever falling again.
Now, with all of these terrible numbers flying at people’s heads like angry birds every day from their favorite news broadcasts, its hard for most people to put it all in perspective. So let me help you with that: we are deep into the shit here, folks. Deep. We are in the middle of the first global recession since World War II, and it wouldn’t take much of a shake-up to turn it into a full-blown global depression: the first since the Great Depression of the 1930s.
Hell, Blanchard even said that if it hadn’t been for the ambitious stimulus spending plans of the United States and other developed nations across the world this year, the global contraction would have been even 1.5 to 2 percent worse and, as Blanchard put it, “We would be in the middle of something very close to a depression.”
Tim Geithner perhaps said it best when he commented separately on the results of the I.M.F. report: “Never before in modern times has so much of the world been simultaneously hit by a confluence of economic and financial turmoil such as we are now living through.” Even though globalization helps economic growth in good times, Geithner said, “now we are learning that in times of contraction, globalization transmits trouble with enormous speed and force, affecting economies around the world — the relatively strong as well as the more vulnerable.”
I’m not saying its time to start stockpiling canned goods, but I’m saying you should think about it if things look like they’re getting any worse.
Anyway, I’m going to go and smoke some more herb before I have to read anything else about the Taliban being sixty miles form some nuclear warheads, the swine flu spreading over the planet, or cyberterrorists trying to destroy the U.S. power grid. If you people have any sense, you’ll do the same.
P.S. If the swine flu does explode into a pandemic and destory the human race, I think that Hunter S. Thompson will have missed out on some satisfying cosmic irony. What better disease to wipe out the modern world that was built by the era of greed, excess and rampant deregulation which began in the 1980’s? Thompson described that generation best himself in Generation of Swine: “Huge brains, small necks, weak muscles and fat wallets — these are the dominant physical characteristics of the ’80s… The Generation of Swine.”
Couldn’t have said it better myself, friend. Oh and thanks a lot, Ronald Reagan.