Watching • Video Digest: March 21, 2008

CNN doesn’t like to give up its news crawler—you can’t escape it by watching videos on its web site. That’s how I learned in “a recent poll,” some very high percentage of “polled Americans” believe “the economy is in a recession.” It’s a national mantra now: housing bubble, oil shortage, recession, om.

On a large scale, we aren’t experiencing anything new; narrowing the scope to the twentieth century, problems with housing, oil, and a weak economy cycle through the decades. Just as hemlines rise and fall, facial hair grows and recedes, the differences are mostly contextual. At least, that’s the impression a person gets from media in the lean years.

By now, presumably every literate person understands how the housing market wound up in a wreck. You may not know that the rise and fall of homeownership directly correlates with the rise and fall of Britney Spears. (note: this video contains no paparazzi footage of breakdowns, bad driving, or head-shaving).





Oil was trading at a record $111.80 on March 17, which even in the ridiculous current dollar value cost more than it did during the oil shocks in the 1970s. Then, the government rationed gas; now, we can buy all the fuel we want—if we can afford the $65+ it costs to fill an 18-gallon tank at $3.63 a gallon, the average price of gas in California.

I’ve happily never owned a car, and I hope I won’t need to; this makes it look like nothing but punishment.





According to the Canadian Centre for Architecture, all the fun we’re having with oil too closely resembles games played 35 years ago. Will the same board, same pieces, and same players inevitably bring the same outcome?





In the U.K., the Labour Party felt the outrage of a people suffering under four years of crazy inflation that nearly doubled the price of a Sunday roast beef. Can you imagine?!





In the following commercial, BP kindly asks customers to avoid “jackrabbit starts,” so as to conserve precious BP gasoline. Hands up if you can drive a manual—please skip directly to the clip. For automatic/non-drivers: A “jackrabbit start” is when you take your left foot off the clutch very slowly, until you feel it begin to engage, at which point you release the clutch completely and jam the gas. If you don’t stall, the following happens:





I’ve heard that gas efficiency of modern automatic transmissions renders fuel savings from a manual unworthy of the extra effort, so maybe the preceding clip is as obsolete as Jimmy Carter’s 1978 wage-price guidelines. This was the last presidential attempt to directly involve the executive office in wage-price controls:





The country’s last really terrible housing crisis occurred during the Great Depression: When the banking system failed, lenders had to retrieve all due mortgages (few of which were amortized); there was no money to refinance, and people were losing their jobs by the thousands. Thus were their homes foreclosed and the bottom dropped out of the housing market. Property values were nil, banks weren’t making any more loans, and there was no one left to buy empty houses.

That sounds familiar.





Black Monday, the largest one-day decline in history, began on Oct. 19, 1987, in Hong Kong, and flew west throughout the day—the U.S. market dropped 22.68 percent. That same morning, two U.S. warships shelled an oil platform in the Persian Gulf.

Q: What country did that oil platform belonged to?
A: Iran!





Documentary break! This is the first 10 minutes of The Story of Oil, starting back in the Mesozoic Era (when dinosaurs ruled the Earth and seas!) and explaining roughly everything about it up to the present day. It’s a proper documentary, with a hypnotically deep-voiced narrator, and quick cutaways to scientists with dramatic facts. Maybe the computer-generated sea beasts will inspire you to give up your car, or something. (Note: the sound is low and fuzzy until 3:45, at which point it becomes and remains loud and clear.)





I don’t want to end on the lowest note—but remember that nastiness with mortgages and foreclosures during the Great Depression? Between 1928 and 1934, residential building construction tumbled 92 percent. The passage of the National Housing Act of 1934 started another huge increase in building, and oh what good times were ahead. The government offered amortized mortgages on furnished model houses—you could live in relative luxury for less than that rent you’d been paying on some rotten little apartment! Even better, housing values began to increase, and your little property was worth significantly more than what you’d paid back in ‘36. Thanks, Federal Housing Administration!





Since then, the Department of Housing & Urban Development swallowed the FHA, and if you didn’t know, HUD is a morass of corruption these days; when it reaches the U.S. Virgin Islands, you know something’s seriously wrong. Still, the country came out of the Great Depression eventually, and the government will be in radically different hands next year. I admit, I’ve considered stashing all my money in the mattress, lest the banks fail again; now, there’s nothing to do but wait and see. If you have better ideas, though, let me know.

 —Meave Gallagher, Mar. 21, 2008

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