In standard consumer lingo, a recession is never good. By economic definition, it means a slowdown in spending, which leads to a slowdown in production, which leads to unemployment and so forth.
The United States has seen its share of recessions since its inception over two hundred years ago. A quick review of Wikipedia’s “List of Recessions in the United States” provides a concise synopsis of the phenomena. While today’s perceived panic may be widespread, it is not uncommon.
More to the point, the current global recession is led by the United States. Few have the overall global impact that an American-led recession entails in this and the last century. The reason is simple. Until recently, the U.S. was simply the world’s largest producer and consumer.
Even China can feel the impact of the global recession.
According to an October 30, 2008 report of the Economist Intelligence Unit, China’s GDP is expected to slow to 8% in 2009, and 7.5% in 2010. Moreover, the drop from recent Chinese GDP in excess of an annual eleven percent was hardly unexpected.
That, however, did not stop the world’s largest trade show, the China Import & Export Fair, in Guangzhou (Canton) from attracting some 200,000 international buyers in the three weeks of October 15 to November 8 this year. More than twenty-five percent of China’s 2008 exports, or $38 billion, resulted from the show.
While shipments to the United States and Europe slowed in tandem with the credit crisis, those to wealthier nations, such as Russia and the Middle Eastern countries increased substantially. Even less-developed nations of Latin America and Africa contributed to continued gains from Chinese export trade.
While the global recession may be especially bothersome to American consumers who are used to profligate ard irresponsible spending, there may be a silver lining.
The recession certainly provides the world with a slight respite from the selfish, myopic intent on growth without adequate regard for mankind and our common biosphere. It provides a rare opportunity to take a cue from the late German-born economist, E. F. Schumacher (1911-1977). In his renowned book, “Small Is Beautiful” he suggested “Perhaps we cannot raise the wind. But each of us can put up the sail, so that when the wind comes we can catch it.” The winds of change foretold more than a quarter of a century ago that the world would see rapid changes which to many were unthinkable. The quadrupling of oil prices by OPEC, the failure of communism, the economic growth and influence of China and India pale by comparison to the inherent dangers of what New York Times columnist Thomas L. Friedman calls “The World is Hot, Flat and Crowded” in his latest best-seller. Unfortunately, a negative response to the historic blip of the recession may engender revisionary, nationalistic political policies. A solution must, can and will be achieved, whether by Washington or Beijing, Paris or Riyadh. It will take the necessary combination of all the world’s economic and intellectual powers to move the world forward to its inevitable victory over the problems spawned by previous centuries. As Bob Dylan sang nearly a half century ago, “The Times They Are A-Changing.”
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