The continuing financial crisis is popping up in odd ways. Okay, it's hard to feel sorry for millionaire superstar baseball players. Still...I almost feel sorry for Adam Dunn. Finally free after spending his career with Cincinnati, he finds himself in a market that's suddenly cost-conscious. Bud Selig has been warning teams to watch their spending, and it seems many are listening. While this likely won't hurt CC Sabathia's bank account, there's remarkably little interest in Adam Dunn. He may not even be offered arbitration - which would have been considered a shocking development just a few months ago.
The economic crisis is also having a severe impact on colleges and universities. Schools rich and poor are being affected. Some students are being forced to drop out, because they can't afford the tuition and can't get student loans because of the frozen credit markets.
The scary thing is that it may get a lot worse before it gets better. (If it ever gets better.) There are rumors that many colleges cannot even afford to pay for the scholarships and other financial aid they've already offered. Their budgets and financial aid offers were made before the crash in September. Even wealthy schools are constrained by rules governing their endowments. Unless you're rich, it's a rather scary time to be a college student.
I was thinking that the slowing economy might have a silver lining in lower prices and better deals for hotel stays. (Yes, I'm still hoping to trek down to Florida for spring training next year.) But now I'm wondering how many hotels will even be open. The mortgage crisis is moving into commercial real estate now, and hotels are already closing.
It's the holiday season, when people want to party, not worry about the economy. And in most ways, life is surprisingly normal, despite the cracks opening up here and there, visible to those who are looking. Ronald Reagan's former speech writer, Peggy Noonan, wrote about this, and credits the "safety net" we have now, that didn't exist in 1929. And this article, in the Boston Globe, argues that the new Great Depression won't look like the old one. Food and clothing are much cheaper now than they were in 1929. Back then, the average man could afford only six outfits, the average woman only nine. Today, the average American has more clothes than they know what to do with. Rather than ragged people lining up at soup kitchens, the new depression will likely involve daycare and health care becoming unaffordable - the big-ticket items in today's economy.
I think they may both be wrong. The Great Depression didn't reach its low until 1932-1933 - years after the 1929 crash. We won't know if things are different this time until about 2012.
Labels: The Greater Depression
