Depression Economics

I can't claim to have lived through the Great Depression, but I am the youngest of 4 children and it is clear that the rest of my family did. The only two things that I every heard my mother brag about was the fact that she didn't always know where the next meal was coming from, but the family never went hungry and that we "never went on the dole." Maybe it was the fact that we lived in rural Illinois that made this possible. The sense of thankfulness for what we had and a focus on what we really needed never left her and I think never left the rest of the family either.

I wonder whether the current economic crisis will have the same effect, lasting for a generation. On the CBS Evening News last night, they talked about the way that Toyota was dealing with its slumping sales; reducing hours and salaries but not laying off anyone. They even cut salaries by 30% at the top, 20% for some in the middle and only 10% for those on the production line.

But I think the real story came from this comment, made in passing by the owner of Rockland (NY)Toyota.

We had people wanting the new car -- the shiny, new car, the new model the exciting car that's out there. They wanted that. Now what's happening is we're finding people need the car -- the car breaks down, they have a big bill in service, their lease is over, they needs to buy that car. We got to get these wanna-bes back in

If the American public has truly gone from buying everything they want to buying only what they need, then the recovery is not going to come quickly and that is a good thing... in the long run.