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Part I - The Good Old Bad Days

In the 132 years between 1797 and 1929, there was no effective regulation of U.S. economy. No federal agencies existed to control corruption, fraud and exploitation on the part of the business class. Even during the Civil War, economic management on a national level was minimal and war profiteering common. As a result the country experienced 33 major economic downturns which impacted roughly 60 of the years in question. These included 22 recessions, 4 depressions, and 7 economic "panics" (bank runs and failures).



Then came the Great Depression starting with the crash of the New York stock market in 1929. This soon became a worldwide affair which lasted until the onset of World War II. Millions were thrown out of work, agricultural production partially collapsed, and the fear of rebellion and revolution was palpable both in the U.S. and Europe.





Part II -- How Quickly We Forget



Essentially, Roosevelt and the New Deal saved capitalism from itself. Left to those, such as Herbert Hoover, who could not escape the paradigm of free market ideology, capitalism in the U.S. may well have followed much of Europe in succumbing to the revolutionary movements of the right or the left.



It has been 67 years since the end of WWII and during that time there have been 11 recessions impacting only 10 years of that timespan. Most of these recessions have been mild affairs compared to the 33 that came prior to the onset of the Great Depression, and the welfare safety net has helped the hardest hit to survive. However, since the 1980s, the U.S. economy has become more unstable and some of the downturns more severe.



What of the steadfast adherents to the free market ideology? It would have been nice for the world if the Great Depression had put an end to them all -- but that was not to be. For those who can understand things only with the help of rigid and all inclusive paradigms, ideology is what makes sense of an otherwise chaotic world. Ideology is also what defines good and evil for such minds. So it stood to reason that many committed free marketeers would retreat into a temporary silence and wait for a time to reassert their beliefs.



It did not take long. In fact, counting from 1939 and the outbreak of the World War II (the event that finally marked the end of the Great Depression), it took only until 1980 or 41 years. That is two generations which is actually just about right. Unless purposefully passed on from one generation to the next, both skills and memories tend to dim and lose their meaning. So it has been with the memories of what unregulated capitalism cost the nation in the years before the New Deal.



Why did things change for the worse in 1980? That was the year Ronald Reagan, a B-grade actor and man of little intelligence, surrounded by neoconservatives and free marketeer ideologues, was elected president. Working within the context of generational forgetfulness, he set us all on a path toward deregulation and a resurgence of the free market ideology. It is to be noted that the country's most recent recession (2007-2009) has been the worst of the post war era and a direct result of prior deregulation.



We are still on that path and the living proof of this fact is that the Republican presidential candidate, Mitt Romney has just selected Congressman Paul Ryan as his running mate. Ryan is the Chairman of the Budget Committee in the Republican controlled House of Representatives, and author of a proposed federal budget that would slash social spending (and those safety nets) by some $3.3 trillion, ditch Medicare and Medicaid, while simultaneously cutting taxes for the wealthy. Ryan is no less than the reincarnation of a free marketeer who wants to recreate the circumstances that brought us all 33 major economic downturns crowned by the Great Depression. How quickly people forget.

Part III -- Social Darwinism As Well

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