Does anyone remember the deep Economic Recession of the early 1980s? (WWII, war)

[Refugee56]

The news people are saying that the economy is currently worse than at any time since the great depression of the 1930s. This is hard to believe.

I graduated from college in 1981, which was the start of the Reagan Recession. Unemployment in my hometown was three times what it is today. Some cities were basically closed down due to unemployment rates that were close to 25%. A single job was advertised and hundreds would apply. Social services were overwhelmed. Over a thousand banks closed.

Early 1980s recession - Wikipedia, the free encyclopedia

Historians: How does the current economy compare in your opinion to the recession of the early 1980s?

[harry chickpea]

Recessions don't affect all areas equally. I never felt the 1980s recession, and I did a lot of moving around during that decade. I'm not sure I would call it a Reagan recession anyway. Things were looking bleak during Carter's admin. as well, what with gas shortages and calls to wear sweaters.

[Six Foot Three]

Although i knew of the Carter recession i was totally clueless as i joined the Navy in 1981 and was employed with the Navy. Also i remember the HUGE Naval Shipyards in Norfolk, Virginia were booming under Reagan as my ship was in Drydock my first year in as i remember all the Workers there working on the Navy Ships so it didn't effect me at all as again i was clueless about it.

[mofford]

The early 80s recession had it's roots in the 1973 arab oil embargo and Nixon severing the last ties of the dollar with gold. The spikes in fuel set off a major decline in the auto industry, at the same time the steel industy moved overseas. Inflation was climbing under Nixon and Ford, but the worst part of the recession was from 1978 to 1982.

I wouldn't call it the "Reagan Recession" as he was the 4th president to deal with it, and the only one of the previous three to turn it around. I would not pin it all on Carter either, as the period from '73 to '82 was rife with enonomic peril for the US. There was probably no way to avoid it. Just like the great depression in the 1930's, FDR's new deal could not turn it around either.

[Dd714]

Originally Posted by Refugee56

Historians: How does the current economy compare in your opinion to the recession of the early 1980s?

I ws just in college at the time and don't even remember a "Reagan recession", kind of funny name since at the first date he took office inflation was double digits and unemployment was at 8%. I would call it the 'Carter Recession" myself. I remember hard times during the Carter Administration, mostly due to gas shortages. I remember localized job losses - mostly in the rust belt areas of the country. It seems to have been localized to certain areas of the country, I don't remember any impact at all to where I lived. I remember the City of New York in banctupcy. I remember "Reaganomics" which so many people made fun of, but as a whole I remember the Reagan era as overall good, econimically speaking.

Things were much worse then, compared to now, as I remember news broadcasts from those times (but, like I said, not where I lived). Double digit unemployment and inflation. Back then it was reporting on what actually was going down - facts. Today it's fear mongering news media talking about what could be - talking heads and theories.

[mofford]

As for the impending recession we have now, it was avoidable. You take a balanced budget and turn it into a 10 trillion defecit. You let "sub prime" people buy houses with no proof of income, thus driving up the price of homes by artificial demand. Is it smart policy to encourage people to buy big SUV's and houses when your 70% dependent on foreign oil ? Without developing new sources ? No nuclear, no electric cars, no strengthening of building codes, no increase in fuel economy standards, no additional drilling. Our policy has been very, very retarded IMO. Sorry Im drifting into POC forum mode here, but oil brought on the last big recession, and this one too.

[jfre81]

To call that a "Reagan" recession isn't all that fair, but what the Reagan administration did was borrow and spend our way to a false sense of prosperity, only to end up in a similar situation during H.W. Bush's term. Bush had to renege on "Read My Lips," raise taxes and lost the election. The next president is in the same fix, which is why I can't take McCain's promises to cut/not raise taxes too seriously.

[cpg35223]

In my city, unemployment was 16%, worse than Flint Michigan. Interest rates were 20% and my father was an architect and my mother a realtor. They told me flat-out that I would have to work my way through school to get a degree. So, somehow, I finagled a job at a newspaper. I went to school from 8-2:30, worked from 3 to midnight, and studied whenever I could. I didn't get much sleep for about three years.

[ogre]

I wouldn't call it the Reagan Recession or the Carter Recession. In addition to the factors Mofford points out, there was also an increase in the rate of inflation in the early '70's, and, at about the same time, an industry-specific recession in defense-related businesses as we began to reduce our presence in the Vietnam war. There may have been other factors as well. It was a very complicated set of interacting factors, that produced chronic economic sluggishness for more than ten years, before the proseperity that began in the mid '80's, continued into the '90's, and has continued into the current decade.

I suppose you can choose the numbers you use, and come up with any estimate you want to of how bad a given situation is, but, as someone who lived through the '70's, I have the perception that the current "crisis" is a minor bump in the road compared to the '70's (at least for now; we don't know whether it will get worse or better, or when either of these might happen). The current unemployment rate is below the average rate from the mid '70's to the early '80's. When we "recovered" from the brief recession of '74-'75, the unemployment rate "improved" to a rate higher than the present rate that leads people now to say we are in real trouble. Then there was double-digit inflation for several years in the late '70's and early '80's. I think someone must really want very much to report the current situation as "the worst since the Great Depression," and must be crunching some carefully selected numbers to portray it as such. The '70's were much more difficult.

Links to historical economic data:

(on some sites, you need to scroll down to reach the relevant data; on the inflation page, you need to scroll down on page one, to links that lead to the data for specific groups of years)

Unemployment rates:
http://www.blogmybrain.com/stock_app...ment/n00/00r/a

http://www.nidataplus.com/lfeus1.htm

Inflation rates:
http://inflationdata.com/inflation/I...Inflation.aspx

[eatfastnoodle]

Originally Posted by Refugee56

The news people are saying that the economy is currently worse than at any time since the great depression of the 1930s. This is hard to believe.

I graduated from college in 1981, which was the start of the Reagan Recession. Unemployment in my hometown was three times what it is today. Some cities were basically closed down due to unemployment rates that were close to 25%. A single job was advertised and hundreds would apply. Social services were overwhelmed. Over a thousand banks closed.

Early 1980s recession - Wikipedia, the free encyclopedia

Historians: How does the current economy compare in your opinion to the recession of the early 1980s?

This time, the crisis could potentially sink to worse than the Great Depression, 80s recession was a direct result of 73 oil embargo, collapse of Bretton Woods system and intensified global competition, I would say it's unavoidable since the good old days of 50s was the result of destruction of much of the industrialized world by WWII, dirty cheap oil from middle east controlled and produced by American oil companies, both factor contributed to big trade surplus thus made possible the fixed exchange rate between gold and dollar. None of the factors were sustainable. As for this time, the financial crisis could be attributed to all the efforts by Reagan and others to revive American economy: massive build-up of debt and deficit, deregulation, hollow-out of American manufacturing industries, etc. American economy relies more than ever on financial industry, which by itself isn't sustainable (financial industry should be the means to a end, we turn into the end itself). This crisis is more dangerous because unlike during the depression, America isn't the premier manufacturing power any more, the massive demand created by WWII lifted US economy out of depression because America produced the kind of products that meet the war demand. Now, comparing to the "real economy" that produces real good and services people need, the financial industry has grown too big and taken up too much resources, it's dangerous because there isn't concrete economy underneath to support it.