ARE WE REALLY CHANGING?
Just as the 1930s Great Depression that brought Adolf Hitler to power, the New Deal, the “Hunger Marchers” and John Steinbeck’s The Grapes of Wrath. this recession, like the Depression, is having its impact on society, re-shaping our global economy and probably our values.
In May this year, Time Magazine titled its cover “The new frugality” claiming that the “Great recession” is transforming how we spend, whom we trust, where we save and what we really value”.
British society was reported not to have been this frugal since the last rationing ticket in 1953. A Consumer Opinion Panel commissioned by uSwitch.com shows 64% of those surveyed would always haggle over the price of items in selected outlets.
“Great recession is transforming how we spend, whom we trust, where we save, what we really value” Time MagazineLouise Bond from uSwitch.com said: "The economic slump has created an epidemic of ‘bag a bargain' consumers, all taking measures to recession-proof their pockets. Shoppers across the nation are casting off their inhibitions and haggling for knock-down prices, cashing in on retailers' desperation to secure a sale."
Sociological research centres have noticed a decline in materialism in the average American household. David Rosenberg from the Merrill Lynch bank says households clean their situations, paying back their debts and saving. The average personal savings rate in America was close to 0% before the crisis, it went up to 3% in November and should reach the 8% according to Rosenberg.
A Pew Research Center survey revealed that there are deep necessity revaluations in society. People are considering yesterday's necessities as today's luxuries.
Ronald E. Anderson, Emeritus Professor of Sociology at the University of Minneapolis is at the forefront of society’s changes through his blog ‘The Sociological Eye’.
He says: “Small shift values have occurred within the American public and, perhaps around the world. That change consists of dropping or chipping away at materialistic, consumption values.”
Yet, Anderson stays cautious with his statements. He says: “If you look at the Great Depression, obviously it had a huge impact on people behaviours and change attitudes and values in the United States. But after one or two generations Americans returned to their self-centred behaviour, not worrying about any quality and what is, I would say, irresponsible frugality, if there was frugality…”
But he says that “there’s room for hope. For two reasons: Firstly, the younger generation is in its stride and is thinking more seriously of the consequences of the recession. Secondly, potential for social networking means that changes can occur much more rapidly in the society that they used to, especially among the young ones.”
Dr Noreena Hertz, Fellow of the Judge Business School at the University of Cambridge says in her podcast that what she calls the “Gucci capitalism” is over. Instead, we are entering a “Co-op capitalism”.
She said: “I believe that the conditions are in place for a new form of capitalism to arise from the debris –co-op capitalism, with co-operation, collaboration and collective interest at its core.”
She mentions five reasons for this:
“First, the public are angry” initially against the banks but Hertz sees an expansion of this anger against the companies that “pay their executives millions while sacking workers.”
“Second, there is a mandate for government to intervene that has simply been absent for the past three decades.”
“The third reason why is the time is ripe for a new form of capitalism is that the downside of globalisation has been exposed. Just how quickly the financial crisis is infected country after country shows all too clearly that in an interconnected world we stand or fall together.”
“The fourth reason why is a new era of capitalism looms is that a new configuration of geopolitical forces is emerging.”
“Finally, it is not just at intergovernmental level that we see the signs of more co-operation. Anthropological studies show that societies with less share more.
BIGGEST FINANCIAL CRISIS
The first speculation bubble
happened in Holland where tulip
bulbs reached thousands of Florins.
John Law introduces money-notes
in France, opening credit to everyone.
The Second Industrial Revolution
created Stock Exchange speculations
that led France to the 1848 Revolution.
Europe and the United States,
experienced strong
economic growth fuelled by the
Second Industrial Revolution
and the conclusion of the
American Civil War.
In September 1929 the stock
market reached an all-time high.
In the weeks that followed prices
of shares fell dramatically.
The market lost 47% of its value
in twenty-six days.
The organisation of petroleum
Exporting Countries (OPEC)
quadrupled the price of oil.
Ongoing financial crisis triggered
by a dramatic rise in mortgage
delinquencies and foreclosures in
the United States, with major
adverse consequences for banks
and financial markets around the globe.