A Comparison Between the Great Depression and the Global Crisis

The 1929 stock market crash and the subsequent ‘great depression’ was the biggest economic crisis that the world has experienced. The depth and length of the crisis and the suffering that it caused is legendary. Therefore when the global financial crisis struck in 2007, many rushed to proclaim that we were about to experience another depression on a similar scale, or at least what some have termed a ‘great recession’. This paper will compare and contrast the two economic crises to analyse the key similarities and differences between the two. To do this, the paper will firstly provide an outline of the conditions that led to the 1929 crash in the economy. Moving on from here the paper will then look at the policy responses that were implemented to tackle the crisis before analysing the conditions that precipitated the 2007 financial crisis and the policy responses, to draw out the similarities and differences of each of the crises, and to ascertain were any lessons learned during the current global crisis from the policies of the great depression era. Finally the  paper will conclude with a discussion of the main points raised by the analysis of both crises and a look at the future prospects for recovery.

Does Money Equal Power In American Politics?

“The executive of the modern state is but a committee for managing the common affairs of the whole bourgeoisie” (Marx, Engels). 

The American political system is often portrayed as a model liberal democracy where anyone can have access to power and decision making through a system of representative democracy. On the surface this is completely true, with open and transparent government at the core of the American political system. In the United States, the lobbying of politicians is a central feature of the system, with lobbying seen as an industry that is a natural part of a liberal democracy. However, a deeper look at lobbying, interest groups and political action committees (PAC’s) reveal a controversial world where critics suggest that money equals power and political influence can be bought. As the above quote from Karl Marx suggests, the power of capital is the same now as it was long ago and will be the same in the future as long as democracy is twinned with the capitalist mode of production where wealth and power is concentrated in the hands of a minority.

The Enough Campaign And The ULA

The 'Enough' campaign's recent #IrishRevolution July16th protest demonstration drew a crowd of between 400 to 1000 people (depending on who you ask) onto the streets of Dublin's city centre. The event didn't quite live up to its billing, but was an energetic and encouraging demonstration nonetheless, by groups opposed to the EU / IMF deal, and other issue specific groups. The Enough campaign was initiated by the Socialist Workers Party (SWP) to try to create a broad opposition campaign against the EU / IMF deal, and to demand a referendum on that deal. Whilst this type of initiative is to be welcomed, I believe that its demands do not go far enough. I also believe that future campaigns ought to be initiated, developed and prepared for under the banner of the United Left Alliance (ULA). Unfortunately, the SWP don't agree with this, and prefer to push ahead with their own 'Enough' campaign.

Debunking The Myths Of Irish Capitalism

There is no alternative. We must rely on foreign direct investments and on the private sector to create jobs. Private is more 'efficient' than public. An entrepreneurial spirit will drive economic growth. These are just some of the mantras that we are exposed to on a daily basis from economic commentators, whom our mainstream media promote as 'experts'. They have a monopoly over our airwaves and newspapers, and use it to espouse their ideas as if they were common sense facts that are irrefutable. However, with a serious analysis of Irish capitalism it is quite evident that their mantras are neither common sense nor facts, and are very refutable indeed. A look through the figures on the Irish economy reveal a very different picture to the one painted by our government and the economic 'experts,' who argue that an economic recovery based on real job growth is to be achieved through attracting foreign direct investments (FDI's) into the country, and a strong Irish entrepreneurial spirit.

The Crisis Of Capitalism: What Lies Ahead?

We are often told by the innumerable economic commentators on the issue, that we are currently experiencing the worst financial crisis since the 1930s. However, the current crisis is in many ways different to others because of its globalised nature and because of the ‘advanced’ form of capitalism it exposes. It must be recognised that capitalism as a form of investment in manufacturing has been in decline since the 1970s, with modern ‘advanced’ capitalism now based on financial speculation. The crisis we are experiencing illustrates that far from being part of a boom and bust process, the inherent greed that capitalism predicates itself upon has led to the system destroying itself from the inside out.

The Race To The Bottom Continues...(High Court sanctions cuts to the low paid)

The news that the High Court of Ireland has upheld a challenge from the 'Quick Service Food Alliance'  on the constitutionality of laws setting the mandatory minimum wages of 200,000 low paid workers, is indicative of the race to the bottom in pay and conditions of workers in Irish society.  It is also illustrative of the rotten system we live under. When High Court judges, who on hugely over-inflated salaries themselves refuse to take a pay cut, an issue that will need be put to a referendum,  can condemn the lowest paid workers in Irish society into further poverty, we know we live in a screwed up system.  The Joint Labour Commission (JLC) wage setting mechanism was there to set minimum pay rates for workers in the retail, bar, restaurant, hairdressing and catering sectors amongst others.  These workers, most often women, students or migrants, already victim to low pay, will now face the prospect of further pay cuts in their meagre salaries.

The Domino Effect: The Revolution Spreads

In the future when history is being written, the year 2011 will be known as 'the year of the revolutions'. Since the turn of the year we have seen a wave of popular uprisings across the globe. First was Tunisia, where the dictator Ben Ali was overthrown.  Next came Egypt, where Mubarak was forced from power and arrested, before the domino effect took hold and the scent of revolution spread across the middle eastern region. At the moment, uprisings are continuing in Lybia and Syria, although the former has been hijacked by the powers of western imperialism. The African and Middle East uprisings and revolutions would, many thought, be contained to the region. The past week's events in Spain have cast doubts on whether the contagious and infectious idea of revolution can be contained.

A Critique of the IMF

Recent years have seen growing criticism of the International Monetary Fund. What are these criticisms and are they justified?

“It is important to note that IMF programmes are not designed to increase the welfare of the population. They are designed to bring the external payments account into balance.... The IMF is the ultimate guardian of the interests of capitalists and bankers doing international business” (Kari Polanyi Levitt, cited in Torrie, J. 1983, Introduction).

Ireland's Future. Lessons From History

Since early 2007, the world capitalist free-market economic system has been experiencing a systemic crisis.  A report circulated by the Organisation for Economic Co-operation and Development (OECD) in 2008 stated the crisis was caused by “global macro policies affecting liquidity and by a very poor regulatory framework that, far from acting as a second line of defence, actually contributed to the crisis” (Blundell-Wignall et al, 2008, p. 2).  As a small and open free-market based economy, Ireland was caught in the contagion from the unfolding crisis of world capitalism.  However, far from being an innocent victim of conditions in the world economy, the Irish state’s economic problems were the result of both international and domestic factors.