Economic Collapse Was Foreseen

The Republican minority on the Financial Crisis Inquiry Commission asserts that the Commission Report's conclusion that "the crisis was the result of human action and inaction" and so was "avoidable" is mistaken because it indicates that the collapse was foreseeable. The minority report claims that the crisis could not have been foreseen.

In fact, not only could the crisis have been foreseen; it was foreseen. I, for one, wrote an analysis more than a year before the collapse, "If (Economic) History Doesn't Repeat Itself, Does It Rhyme?" in which I compared the 1920s and 2000s and concluded, "I will say with assurance that a serious collapse is coming. The only question is whether it will be as bad as what ensued after the similarly wrong-headed era of economic fantasy in the 1920s."

And the failure so far to address the problems, including Marketism - an excessive, blind faith in a self-correcting market - that produced the collapses of 1929 and 2008 means that the rhyming of economic history will continue.

Historian Robert S. McElvaine teaches at Millsaps College and is the author of The Great Depression: America, 1929-1941 (25th anniversary edition, 2009).