Depression, Recession, So What?

By Shelton Bumgarner

As an expatriate in Korea, one grows used to the ebb and flow of geopolitics having a direct effect on your life. Until recently, America's involvement in Iraq was, in essence, giving English teachers here a raise simply for showing up. However, things have obviously changed dramatically with the current worsening economic situation.

One thing that's been discussed a great deal is the possibility we're headed for a global recession. Another, scarier, way to refer to a ``global recession'' is a ``great depression.''

They say difference between a recession and a depression is in the former your neighbor loses their job and in the latter you do. Depressions are different than recessions in their length and depth. The usual post-war recession lasts about 18 months and usually starts before anyone even notices. (A recession being several successive quarters of economic retreat.) A depression, on the other hand, would be years not months.

While the last great depression took a huge toll on the lives of those who lived through it, the Great Depression's side effects are really what we live with today. The greatest side effect of which was, of course, World War II.

Global political instability is the thing that is scariest about a depression. A Second Great Depression could possibly shake up the world order in unexpected ways. We've come to take for granted a level of global and economic stability not seen since after the Congress of Vienna that was held at the end of the Napoleonic Wars.

Both China and Pakistan could explode into chaos if the current economic downturn goes from recession to depression. China has lots and lots of problems that have been hidden by its gang busters economy, and either a civil war or new leaders that may see Maoism as a way out are real possibilities. Pakistan could collapse and be taken over by the Taliban who currently reside in its northern tribal regions. The Taliban with ``The Bomb'' would be a real game changer because the U.S. would be forced to go to war to fix the problem and we simply don't have the manpower.

Is there anyway to get out of this problem before these nightmare scenarios become reality?

Besides ``time,'' three things may pull us out of any coming global recession. The first idea would be to have a global New Deal that would involve a coordinated effort amongst the nations of the world to put money back into the system and get people back to work.

One scary way to get us out of this situation would be war. As mentioned above, war is often what happens as a result of a depression. In the case of the U.S., it might get sucked into a war simply because no one else has the economic power to support the troops needed to fix a major regional war. Somewhere like a newly revolutionary Pakistan is the only place I could see us getting actively involved at this point. Iran may be tempted to get involved in Iraq if the U.S. leaves and that might cause a war. Other potential problem places around the world that might cause problems include North Korea, China, Taiwan and the ever-present Israel vs. everyone else in the Middle East. Should they all happen at the same time, you then have the makings of a depression-ending global conflict.

Interestingly, it's possible that technology may come to our rescue if nothing else works. Sudden groundbreaking advancements in either nanotechnology or biotechnology could be just the ticket to get us out of a long-term slump. If the price of meat suddenly became extremely cheap through the cloning of individual pieces of cattle or some sudden breakthrough in nanotech made it obvious that we will have near god-like power over our own bodies, then any long-term economic forecasts would obviously be thrown out the window. Both those developments would obviously destroy a lot of jobs, but in the long run, they would help the overall economy.

Having said all that, really, as I mentioned before, the only way out of our current problems is time. With time and the proper economic polices we will gradually get back to something like what we had. Although, that ``time'' might be a decade instead of the usual 18 months. And, before we get too excited about the happy days to come, the specter of $200-a- barrel oil and the general instability associated with the transfer of world power from America to China, India and Russia is also something we have to worry about. Welcome to the future!

The writer is an English teacher in Busan. He co-founded the English journal, ``ROK on Magazine,'' in Seoul. He can be reached at migukin@gmail.com