A Retrospective on the Great Recession that Began Ten Years Ago This Year
AUSTIN, Texas, August 9, 2011. Words have power. Names have power. Three years ago we spoke to Newsweek about what should the then-current/still-current economic crisis be named. The ‘Great Recession’ was favored by the New York Times and eventually ‘certified’ by the AP Style Guide. The Global Language Monitor’s position was that the economic crisis of 2008 did not resemble a recession, as we had come to define recessions, and the resemblance to the Worldwide Economic Depression of the 1930s was tentative, at best.
GLM’s position was that we were experiencing was not a recession, neither great nor small, but something of a wholly differing sort: a Global Economic Restructuring.
Words have power. Names have power. In fact words and names can shape the contours of a debate. And, we might add, words and names carry the inherent capacity to lead us astray. Casting the current reality in the terms of those crises we’ve already experienced, provides the comfort (and illusion) that things are well in control.
It is about time that we admit that what we are experiencing is not a recession, neither great nor small, but rather a global transference of wealth, power and prestige on an unprecedented level, carried out, in von Clausewitz’s words “by other means”.
Originally alluded to as a “Financial Tsunami” or “Financial Meltdown,” the major global media seem to have gained a consensus on “The Great Recession”. In the beginning, most comparisons were being made to the Great Economic Depression of the 1930s, more familiarly known, simply, as “The Depression” in the same way that many still refer to World War II as “The War”. But even these comparisons frequently ended up referring to the recession of 1982, yet another so-called “Great Recession”.
Our recent analysis has shown that while the major print and electronic media have settled upon “Great Recession”, the rest of the Internet, blogosphere and social media world have largely eschewed the term. We believe the difficulty here stems from the fact that this economic crisis is difficult to express in words because it does not resemble any economic crisis in recent memory — but rather a crisis of another sort.
“On War” is one of the most influential books on military strategy of all time. Written by Prussian military theorist Carl von Clausewitz (1780 – 1831), it recorded one of his most respected tenets, “War is not merely a political act, but also a real political instrument, a continuation of political commerce, a carrying out of the same by other means,” which is frequently abbreviated to “War is diplomacy carried out by other means’.
We believe that the reason the “Great Recession” label does not now fit, as has now become obvious, because what we are experiencing is not a recession, neither great nor small, but rather a global transference of wealth, power and prestige on an unprecedented level, carried out “by other means”.
This fact has entrapped two U.S. presidents, from radically diverging political viewpoints, in the same dilemma: describing an economic phenomenon, that doesn’t play by the old rules. Hence, the difficulty experienced by President Bush as he struggled to describe how the U.S. economy was not in a recession since the GDP had not declined for two consecutive quarters, the traditional definition of a recession, even though jobs were being shed by the millions and the global banking system teetered on the brink of collapse. Now we have President Obama, attempting to describe how the U.S. economy has emerged out of a recession, though the collateral damage in terms of the evaporation of wealth, mortgages, and jobs remains apparently undaunted and unabated.
And the world, from China to Germany, stands aghast as we continue to argue, in spite of all available evidence that debt is a good thing. “We all say so, so it must be true!” seems to be the all-too-familiar refrain from Washington.
The regional or global transfer of wealth, power and influence, the destruction of entire industries and the so-called collateral (or human) damage are all hallmarks of what is now being experienced in the West.
If one carefully disassembles the events of the last decade or two, you can see them as the almost inevitable conclusion of a nameless war that began with the collapse of the Soviet Union, the embrace of a form of the free-market system by China, India and the other rising states, an almost unprecedented transfer of wealth from the Western Economies to the Middle East (energy) and South and East Asia (manufactured goods and services), and the substantial transfer of political power and influence that inevitably follows.
It currently appears that the Western Powers most affected by these transfers cannot adequately explain, or even understand, their present circumstances in a way that makes sense to the citizenry, let alone actually reverse (or even impede) the course of history. In fact, the larger events are playing out while the affected societies seemingly default to the hope that they ultimately can exert some sort of control over a reality that appears to be both out of their grasp and control.
The good news here is that the transfers of wealth, power and influence has proven relatively bloodless but nonetheless destructive for the hundreds of millions of those on the front lines of the economic dislocations.
And it is in this context that the perceived resentment of the Islamic and Arab states should be more clearly viewed. This is especially so as they, too, watch helplessly as the new global reality and re-alignments unfold.
In conclusion, it can be argued that the reason the “Great Recession” label doesn’t seem to fit now is because what we are experiencing is not a recession, neither great nor small, but rather an on-going transformational event involving the global transfer of wealth, power and influence on an unprecedented level, carried out “by other means”.
By Paul JJ Payack and Edward ML Peters. Paul JJ Payack is president of Austin-based Global Language Monitor. Edward ML Peters is CEO of Dallas-based OpenConnect Systems. Their most recent book is “The Paid-for Option”, which describes how healthcare reform can actually pay for itself through the application of process intelligence and its attendant gains in productivity.