Notes from the Underground

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I tolerate this century, but I don't enjoy it.

All of the ephemera that is far too trivial to be bothered with elsewhere on this site or, depending on your point of view, a meta-commentary on it. This ephemera includes, but is not limited to art, music and literature. Most of the content here will be discussed in terms that are as abstract as possible, reality being a singularly overrated concept.

Thursday, October 09, 2008

 
Rather predictably, this article has recently been highlighted on more than one occasion:

"The current economic woes look a lot like what my 96-year-old grandmother still calls "the real Great Depression." ... The problems had emerged around 1870, starting in Europe. In the Austro-Hungarian Empire, formed in 1867, in the states unified by Prussia into the German empire, and in France, the emperors supported a flowering of new lending institutions that issued mortgages for municipal and residential construction, especially in the capitals of Vienna, Berlin, and Paris. Mortgages were easier to obtain than before, and a building boom commenced. Land values seemed to climb and climb; borrowers ravenously assumed more and more credit, using unbuilt or half-built houses as collateral. The most marvelous spots for sightseers in the three cities today are the magisterial buildings erected in the so-called founder period.

But the economic fundamentals were shaky. Wheat exporters from Russia and Central Europe faced a new international competitor who drastically undersold them. The 19th-century version of containers manufactured in China and bound for Wal-Mart consisted of produce from farmers in the American Midwest. They used grain elevators, conveyer belts, and massive steam ships to export trainloads of wheat to abroad. Britain, the biggest importer of wheat, shifted to the cheap stuff quite suddenly around 1871. By 1872 kerosene and manufactured food were rocketing out of America's heartland, undermining rapeseed, flour, and beef prices. The crash came in Central Europe in May 1873, as it became clear that the region's assumptions about continual economic growth were too optimistic. Europeans faced what they came to call the American Commercial Invasion. A new industrial superpower had arrived, one whose low costs threatened European trade and a European way of life.

As continental banks tumbled, British banks held back their capital, unsure of which institutions were most involved in the mortgage crisis. The cost to borrow money from another bank — the interbank lending rate — reached impossibly high rates... In the end, the Panic of 1873 demonstrated that the center of gravity for the world's credit had shifted west — from Central Europe toward the United States. The current panic suggests a further shift — from the United States to China and India."


I've long felt that contemporary society bears a marked resemblance to its Victorian precursor, with marked social inequality being matched by the volatility and instability of free markets. As the conservative project to roll back the twentieth century progressed, the inevitable result was that many of the safeguards introduced to prevent depressions like 1873 and 1929 were also removed. The current conditions are essentially identical to those Marx and Engels had hoped would destroy capitalism in the previous recession of 1857 when Dickens had based the character of Merdle in Little Dorrit on railway speculator and Minister John Sadleir, who embezzled and then bankrupted the Tipperary Joint Stock Bank before killing himself. Given that the current crisis poses substantial questions around the Anglo-American economic model of the last twenty to thirty years, it will be interesting to observe whether current events produce novels like Our Mutual Friend or The Way We Live Now, as this article debates:

"In Britain, there is a long-standing aversion to writing about business. More than a century ago, Henry James decreed that novels should focus on private life and the emotions, not politics and business; most writers since have taken him at his word... Perhaps because US writers are generally more ambitious, and also because US culture is less sniffy about moneymaking, modern American novelists seem at home in the worlds of work and money in a way that few British ones do. Think of [Tom Wolfe's Bonfire of the Vanities] Saul Bellow's comi-tragic portrait of errant market speculation in Seize the Day, or Philip Roth's account of factory life in American Pastoral. Or think of David Foster Wallace's sinister vision of a corporatised America of the future in his 1996 epic Infinite Jest.

We should not be surprised, then, that it is an American writer who has been most prescient about the current financial upheavals. In his slim 2003 novel Cosmopolis, Don DeLillo tracked the life of an enormously wealthy currency trader on a day of global financial meltdown. It is by no means DeLillo's best work, but many things about it that now seem prophetic – the way, for instance, he captures the trader's overweening ambition and arrogance, and how he evokes the sense of a system that no one fully understands spinning rapidly out of control."


I do tend to recall Milan Kundera's observation that the re-establishment of the middle class in the Czech Republic following the collapse of the Soviet bloc was a subject worthy of Balzac at a time when novels of that kind had ceased to be possible. Realism in its conventional sense seemed to assume a more homogeneous society that could be more easily conceived of a single entity, which applies rather poorly to contemporary society (although Hollinghurst's documenting of the 1987 stock market crash in The Line of Beauty does rather spring to mind as a counter example). In practice, it may not be that easy to roll back the twentieth century and all of the literary innovations that went with it. Of course, all of this assumes that we don't end up with nostalgic works of escapism like Brideshead Revisited ("it was a bleak period of present privation and threatening disaster — the period of soya beans and Basic English — and in consequence the book is infused with a kind of gluttony, for food and wine, for the splendours of the recent past"), Love in a Cold Climate and Lord of the Rings instead.

Update: a closely related follow-up piece from Tristram Hunt:

"To wander through modern Los Angeles is to get a keen idea of Rome in 400AD, Venice at the end of its medieval glory or post-war London. LA is a city redolent of empire and it is visibly in collapse. It is not just the choking smog, violent ghettos or armies of homeless, but a more fin de siècle sense that its time has passed. One can imagine, in 100 years, the Pacific waves lapping at the stones of Santa Monica, the sand blowing through the skyscrapers and the great film studios serving as a 20th-century Colosseum.

Last week's report from the National Intelligence Council only served to confirm the fear that the age of America is drawing to a close, with the Iraq invasion standing as the final act of imperial hubris. As the Pentagon securocrats rightly predict, the emerging economies of the Bric nations - Brazil, Russia, India and China - are starting to flex their political and military muscles. The dollar's financial dominance is crumbling. Meanwhile, Bollywood and Nollywood (Nigeria's nascent film industry) are beginning to challenge the cultural prowess of Hollywood. In the coming decades, globalisation will no longer stand as a byword for Americanisation. quot;

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posted by Richard 7:51 pm