'This is the worst recession for over 100 years'

[IndianaGreen]

Source: The Independent (UK)

'This is the worst recession for over 100 years'

Ed Balls, the PM's closest ally, warns that downturn is ferocious and says impact will last 15 years

By Nigel Morris, Deputy Political Editor, and Sean O'Grady, Economics Editor

Tuesday, 10 February 2009

Britain is facing its worst financial crisis for more than a century, surpassing even the Great Depression of the 1930s, one of Gordon Brown's most senior ministers and confidants has admitted.

In an extraordinary admission about the severity of the economic downturn, Ed Balls even predicted that its effects would still be felt 15 years from now. The Schools Secretary's comments carry added weight because he is a former chief economic adviser to the Treasury and regarded as one of the Prime Ministers's closest allies.

Mr Balls said yesterday: "The reality is that this is becoming the most serious global recession for, I'm sure, over 100 years, as it will turn out."

He warned that events worldwide were moving at a "speed, pace and ferocity which none of us have seen before" and banks were losing cash on a "scale that nobody believed possible".

The minister stunned his audience at a Labour conference in Yorkshire by forecasting that times could be tougher than in the depression of the 1930s, when male unemployment in some cities reached 70 per cent. He also appeared to hint that the recession could play into the hands of the far right.

"The economy is going to define our politics in this region and in Britain in the next year, the next five years, the next 10 and even the next 15 years," Mr Balls said. "These are seismic events that are going to change the political landscape. I think this is a financial crisis more extreme and more serious than that of the 1930s, and we all remember how the politics of that era were shaped by the economy."


Read more: http://www.independent.co.uk/news/uk/politics/this-is-the-worst-recession-for-over-100-years-1605367.html

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President Obama is not the only one raising the alarm. Across the pond the Brits are even more pessimistic.

[sandnsea]

1. My state legislator said 10 years

He said this recession is probably really a depression that they might tell us about in a year, and that unlike most recessions that are u or v shaped; this one will be L shaped. The stimulus will only affect how deep of an L it is.

[Barrett808]

4. We'll be lucky if it's L-shaped...

...he mutters darkly.

[Javaman]

27. I'm thinking "L" but lower case. nt

[Downwinder]

13. I think 10 years is optimistic, more like 14 n/t

[defendandprotect]

2. This is a rolling snowball and the faster its stopped the better off we'll all be --!!!

[Wednesdays]

3. Mr. Balls...a fitting name

One of few who are unafraid of telling the unpleasant truth, come what may.

[xchrom]

5. i'm SO glad some body else besides me noticed that. nt

[Jackpine Radical]

9. I saw it too.

I just couldn't think of anything worth saying about it.

Oh Balls.

[iamjoy]

6. That Worries Me Too

As much as the dismal financial situation concerns me, I also fear that as brilliant as he is, things are so bad, Obama won't be able to turn around things in a year and a half. The Republicans will take back Congress in 2010 by claiming they were right to oppose the stimulus. Voters will conveniently forget how Republican policies helped get us into the mess in the first place.

They will use the downturn as an opportunity to force their right wing social and economic agenda on us. Sadly, Democrats aren't as shrewd politically as Republicans, so enough will go along with their schemes (just like Iraq).

[IndianaGreen]

7. Balls also said that 'recession could play into the hands of the far right.'

We may go the way of the Weimar Republic.

[bird gerhl]

10. Yes, I can see the BNP profiting greatly from economic collapse.

I fear for the Asians, the asylum seekers, the eastern/central European workers in Britain over the coming years.

[area51]

22. Welcome to DU, bird gerhl. (n/t)

[T_i_B]

24. Yes

I think that the controversy over the italians at Immingham (which has shown Brown's British jobs for British workers pledge to be something of a sham) could be only the start. :-(

[iamjoy]

12. Yes, With Xenophobia

people will blame "foreigners" - Mexicans, and people who are "different" and "scary" like Muslims

[unkachuck]

11. nah....

....I think the only way we could possibly move, is further Left to a planned economy....we need to stop playing boom n' bust....

....when the repugs bash Dems for feeding the unemployeds' children with debt, we'll remind them their tax-cuts for the rich were paid for with debt by irresponsible republicans who created the great great depression....

....when the repugs bash Dems for giving a kid a chance in life with borrowed Pell grant money, we'll remind them all their wars of choice and their profiteering corporate buddies were all paid for with debt....

....hell, 70 after WW2 we're still borrowing money for troops in Europe; defending Germany from France?

[tavalon]

25. Someone else started a meme that I think we need to continue

This is not the Great Great Depression, it's the Bush Depression. His administration bought it, they own it!

[Downwinder]

14. It's not going to improve in a year and a half.

We elected him for his leadership, now he has to show it. FDR was not the whole show, but he set the mood and provided the leadership. Obama will have to do that. He showed in the campaign that he is able. Just remember who got us here and point it out at every opportunity. (Bushing motherbushers)

[caseymoz]

20. That's a worry, but I don't see Republicans making a comeback after this.

If they don't get unemployment down, there's bound to be far more radical parties, as there was in the '30s.

[bird gerhl]

23. "Radical" parties in imploding empires can get kind of ugly...

[depakid]

21. That's a distict possibility

Obama and the Congres seem bound and detrmined to keep pamdering to the right- much as Clinton did in 1993-94, which disillusioned the base- whi simply stayed home.

Worse, by doing so they've substantially weakened an already inadequate bill- which is now unlikely to have the desired effects. It's as if Democrats never learn.

Nothing good EVER comes from making deals with Republicans or adopting their failed policies.

[Nevernose]

8. I, for one, welcome a total economic collapse

Then my investment in this place won't look quite as crazy to the neighbors:

[Lucky Luciano]

17. HAH! Almost looks like something from Burning Man!. nt

[tavalon]

26. Almost?

I think I saw that at Burning Man!

[shanti]

15. oh man...

it's going to be a FABULOUS retirement :(

[Art_from_Ark]

16. The worst recession in over 100 years? Really?

What about that little economic downturn event that occurred between 1929 and 1937 or so? Was it not-so-bad when it was just a Recession, but decided to rear its big, ugly head once it was officially christened a Depression? :crazy:

[IndianaGreen]

18. Ed Balls predicts it will be worse than the depression of the 1930s,

The minister stunned his audience at a Labour conference in Yorkshire by forecasting that times could be tougher than in the depression of the 1930s, when male unemployment in some cities reached 70 per cent.

<snip>

The "Hungry Thirties" were rough on many, at a time when welfare systems were rudimentary. The worst period was from the Wall Street Crash of 1929 to about 1932, but in places such as Jarrow, the unemployment rate hardly dipped below 50 per cent until the economy was mobilised in 1940. However, for many in the south and for the middle classes, the times were relatively prosperous.

http://www.independent.co.uk/news/uk/politics/this-is-the-worst-recession-for-over-100-years-1605367.html

[w4rma]

19. 'free' trade, lack of regulations/ overight/ enforcement, acceptance of corruption.

This is how all this happened. Just remember that all the money is still out there, we just have to get it back into circulation within America.