I do not believe "we" as a society, are capable of totally learning from previous generations mistakes. I believe, to some degree, that we are able to understand our past. We get information through stories from our forefathers, from our literature, as well as multiple other media sources that document the past. However, unless we experience things, we will not totally understand and believe things. I liken it to a child and a parent. As a parent you tell your children not to do things because you know the result will not be good. As a parent you have already done these things and want to protect your child from harm. An example would be not to touch fire because it is hot. When my daughter was very small we had a Citronella candle burning on the porch outside. She must have been 3 or 4 at the time. I remember telling her not to touch the fire many times knowing that if she did she would get burned. One night she must have decided she just had to see for herself if the fire was hot. She reached her fingers by the flame and got a slight burn on her fingers. She cried and had pain. As the tears rolled down her eyes I asked her why she touched the fire after I had told her it was hot. She could not provide me with an adequate explanation. Only that she wanted to see how hot it really was. Through her own experience she learned not to touch fire. That was ten years ago and I am sure she has never touched a burning candle since. I believe this tendency to learn from going through it yourself must be in our genetic make-up. We will only believe so much of what we are told. We must actually experience things to truly believe in them.
I also believe our country has a history that cycles. These cycles tend to repeat themselves in many ways. Kind of like the old saying "The more things change, the more they stay the same." In fact if you look back at great countries and civilizations in history the same mistakes are made over and over to different degrees. I believe part of the reason for that is because people have to live it to learn it. The wealth in America for the past 150 years or more has been controlled by what I call the one percenters. The one percenters are the 1% of people that control anywhere from 40% to 50% of the wealth in this country. With wealth comes great power and influence on our Federal, State, and Local governments. With these thoughts in mind I will discuss the depression of the 1930s and the current recession.
The great depression of the 1930s was a culmination of many events. The stock market crash, reduced spending by Americans, bank failures, and increased tariffs are all contributed to the great depression. During the 1920s times were good. Cash seemed abundant and spending was rampant. Credit was readily available to many Americans. There was a feeling of optimism by Americans that the good times were here to stay. With factories running at capacity and people spending at or above capacity all looked well. The previous 8 years the stock market had risen. This enticed people of all wage brackets to get into the market. People borrowed money and bought stocks on margin. They cashed in when the stocks went up. Bankers and investors persuaded many average people to invest their money in the market. People were looking for a way to get rich quickly. At this time the stock market was loosely regulated. A handful of men with a considerable amount of wealth could manipulate the market with various investments and divestitures. During the few months after the depressions stock market crash, investors had lost more than $40 billion dollars. The Federal Reserve did not get involved. It did not provide an injection of cash. It may have been the Federal Reserve's way of allowing irresponsible banks to fail. Maybe the Fed thought it was the right thing to do. The Federal Reserve had only been in existence for 20 years when the great depression hit. When the markets bubbled and crashed in 2009 it was similar to the depression. There had been a resounding return on stocks from 2003 to 2008. The Federal Reserve and our government observed a "hands off" approach to the market. Regulation of the market and derivatives was minimal. The Fed even discouraged regulators from probing too deep. A laissez-faire attitude was used with the market. When large investment companies began to fail The Federal Reserve and our government responded with an injection of cash and loans. Business and banks were declared too large to fail. The government used the trickledown effect philosophy. I personally do not believe this is the most effective and efficient way to get money in the working man's pocket. I believe it is government's way of allowing the one percenters to continue to be in control. It is still too early in the recovery to proclaim if this strategy worked or not.