Economic Outlook: Economic Disaster

Rampant inflation, energy shortages, and war led a lot of commentators to predict an impending economic disaster in the 1980s.


| May/June 1980



063 economic outlook - impending disaster

In 1980 the decade ahead seemed to promise nothing but economic disaster. 


ILLUSTRATION: FOTOLIA/HITTOON.COM

POGO: "The future ain't what it used to be."  

JULIAN M. SNYDER, International Money Line: "If there is anything certain about the 80's, it is that the outlook is extremely uncertain. The German Chancellor Helmut Schmidt put this into the most succinct (and safest) forecast when he said, 'Nothing will be the same in the 80's as it was in the 70's . . . nothing."'

ALEX HERBAGE, IMAC Economic Newsletter, on the Russian invasion of Afghanistan: "Now we shall pay the price for our continued weakness and lack of vigilance that has resulted from the shameful sale of advanced Western technology to the Soviet nation and its satellites. Truly we have been handing over the rope from which the noose will be fashioned with which Moscow hopes to hang the West. To boot, and to add a dreadful irony to this tragic scenario, we have willingly lent the Communist East the money and the credits with which to purchase our technology, thus helping to undermine our own financial and economic stability."

IDA COX, 30's blues singer: "When you lose your money, don't you lose your mind."

ALEX HERBAGE, IMAC Economic Newsletter: "Confrontation will be the key word of the 80's. Nation against nation, developed world against the emerging nations. Worker against boss,. politician against politician. The world is stirring whether we like it or not. The established order is being challenged by a spirit of revolution and unrest that is rife in the world today. On a global scale, we are now experiencing the fears that must have been felt by the aristocrats and landed gentry when they heard the swish of Madame Guillotine for the first time during the French Revolution. We could all learn more by studying history, and the events of those momentous years at the end of the 18th Century are in many ways parallel to those we are experiencing today. Then — as is happening now — the established order was challenged and a new epoch entered."

RICHARD RUSSELL, Dow Theory Letters: "My feeling is that the 1980's are going to be the years in which Americans finally have to face realities. What are these realities? [1] Russia, with the sacrifice of her economy, is now military leader of the world. [2] The U.S., over its head in debt, is going to have to sacrifice a good chunk of its domestic economy if it wants to remain a free power. [3] The current U.S. concepts of government spending, transfer payments, consumerism, [and] deficit spending are going to be revised drastically. They're going to HAVE to be revised. [4] For 25 years U.S. Presidents have been blathering about "sacrifices" the American people will be called upon to make. So far, the so-called sacrifices (whatever they are) have been minimal to non-existent. In the 80's real sacrifices will have to be made."TIMES OF LONDON, December 12, 1979 editorial: "The forces which have knocked the dollar down against gold are far stronger at the beginning of the 1980's than they were at the beginning of the 1970's. The world shortage of oil, the competition faced by American industry, the rate of inflation in the United States, all undermine the dollar now in a way they did not ten years ago. It would be difficult to find any plausible argument for supposing that gold will weaken in dollar terms in the 1980's."





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