A CIA analyst says that the stock market is close to having a 70% down-turn - a 25 year long depression and the demise of the American Empire will result. (*) Will this happen? Maybe not as soon as he says, but you can't go on printing money and creating stock bubbles without crashing at some point. The way I see it, the crash could come any time now within in the next 5 years.
A 25 year depression? That we should be so lucky! Lucky you say, given all the suffering that such an event would entail? Well, if you want to see suffering, think run-away climate change. This could result in the loss of hundreds of millions, even billions of lives. If something isn't done in the 10-20 year window of opportunity we have, that nightmare scenario will certainly unfold. Everyone other than Koch-rotted climate change deniers knows this, but nothing is being done to offset this coming disaster.
We, the people, simply don't have the strength to force through the necessary economic changes. Our sociopathic ruling classes simply ignore the mass protests and go on as ever. If we get serious they use state terror to crush us. (We see this already in Canada, with non-violent environmental protestors criminally slandered as a “terrorist threat.”)
One important result of the 2008 Crisis was a free fall in the use of petroleum. The price of a barrel fell from $140 to $42. Admittedly, the higher price was in part a result of speculation, but this speculation was in itself based on the hope of a higher demand. What happened in 2008 was that people began driving less to save money. The masses of unemployed also didn't have a job to drive to. The lower demand for goods also meant less petroleum use, both in the manufacturing processes (think oil-based plastics) and in transportation of those products. This fall off in demand will occur in the coming crisis.
Shale and tar sand oil was, and will be, negatively effected. This form of oil production needs about $80 a barrel to be profitable. Below that and they fold up shop. Furthermore, the tar sands are themselves a major source of CO2.
With the Economic Crisis Chapter 2, the whole developed world becomes like Cuba enduring the the Yanqui economic blockade and the loss of Russian sugar purchases. People cease buying, recycling and repairing become the norm. Creative individuals discover that new products can be produced locally in small shops and vast factories and corporate agglomerations are unnecessary, indeed an impediment to a rational system. Urban farming spreads. Local currencies are created to replace the worthless official money. People leave the suburbs for the cities or villages and the most wasteful way of living ever devised is abandoned. The global economy continues to contract, and in a virtuous circle ever further reduces the production of atmospheric CO2.
A lengthy and deep depression, by reducing CO2 emissions may well be the action that buys us more time, enough time to finally get our act together and change the system and create a sustainable, steady state economy. Perhaps we can avoid the horrors of run-away climate change. (This is the first time I have felt anything positive in years.)
The depression may well be a factor in speeding up the process of social and economic change. As of this moment, in spite of the hard times, the austerity and endless war-mongering, the majority of the population sit on their hands. Yet, surveys show this same majority are not at all happy with the present conditions. They are just fence sitting. Yet, many of them continue to vote for their worst enemies and the people demonstrating in the streets are only a minority. Perhaps they sit back out of fear, hanging on to what they have. Perhaps it is like the situation of the frog in the gradually heating pot of water, the negative effects haven't reached them yet. A second major shock should knock them off that fence into active opposition. (**)
Once the vast majority are in open opposition, the system is going down the same road that East Germany took in 1989. State terror, so useful against minorities, - think the suppression of Occupy in the USA - becomes a dangerous option against majorities. It will only serve to further inflame them. Support for the system could end up reduced to the elite and their lackeys. At this point the political system would collapse and could be replaced by the new forms of democracy that have been gestating over the last three decades or more.
** It is true that some of this opposition may gravitate to the nationalist or fascist right, but that is a topic for another discussion – too long for a footnote!