The Week That Dashed Baby Boomers Dreams

By Alan Cowell Published: October 9, 2008

PARIS: It was the week it got personal, the week rage gave way to resignation, the week people began to say "if only" - if only they had stashed their dollars and euros and pounds under their mattress or in a hole in the ground.

As the financial crisis scorched its way through credit markets, stock portfolios, pension funds, auto dealerships, mortgage lenders and dreams, this was the week the usual quick fixes offered only limited relief, leaving many people in wealthy countries to peer into an abyss - a padded one, admittedly, but a dark and foreboding place all the same.

Of all those who watched the swooning graphs of the marketplace describe the parabola of their fortune's decline, perhaps the legions of the baby-boom generation were the most rueful, the least likely to believe they had time to recover, the most likely to ponder the validity of the promise after the Great Depression and World War II that things would only get better.

For the closing decades of the 20th century, it was the defining myth of Western societies that material improvement, passed on from generation to generation, was a condition, an assumption, and not a freak of history.

But that assumption began to look questionable - to say the very least - as the crisis began to spill its toxins from the arcane mysteries of high finance into ordinary people's pocketbooks.

By depending so much on stock-based savings, the baby boomers were exposed to the prospect of their golden years being straitened or even canceled: paradise deferred indefinitely.

And those postwar champions of work and entitlement began to wonder, too, about those who followed in their footsteps, fretting as much about their ability to pay college fees as their prospects of passing on a dream of self-improvement.

Even if the banking crisis is resolved, the aftermath in the broader, real economy that influences Western lives will be a world that works to different, less prosperous and less certain rhythms.

As I have observed here in recent weeks, Western pain is relative. So many people in poor parts of the world do not share in the most fundamental luxury of wealthy societies: the sure knowledge that dreams may be translated into reality by human will.

But that belief, too, began to look frayed as the savings of decades were dwindled in a matter of days, bringing a new sense not just of impotence but also of apocalypse.

As people grasped for moments of comparison to steady themselves and anchor their perceptions of the crisis, the usual points of reference looked feeble: The early 1990s, post- 9/11, the dot-com bust had all roiled the markets, but the memory some people reached for was of the 1930s.

Consider, for instance, the language of the headlines: bloodbath, carnage, slaughter. Black Monday, Tuesday, Wednesday. Successive lurches toward ruin seemed initially to defy interest-rate cuts and state injections of cash running into the hundreds of billions.

"How nice it would be," one reporter remarked to another, "to write the 'soared' again." And the other replied: "Except you would spell it s-w-o-r-d," denoting the slash and burn of the markets.

Not everyone saw it that way.

"The world's monetary authorities are at last really trying to reassert their power over the financial markets," the columnist Hamish McRae wrote in Britain's The Independent on Thursday. "They have not yet succeeded and they will have to do more, maybe much more, but eventually they will win. Or at least they always have in the past 75 years. You have to think that the world is facing something akin to the Great Depression of the 1930s to believe that they will fail."

But the world was different then. Globalization had not lowered national rivalries and trade barriers. China had not emerged as a huge economic power.

"Though much of the developed world may go into some sort of recession," McRae wrote, "we are not talking a decline for the world as a whole."

History might see a broader lesson in these moments of tectonic shift: Capitalism defeats communism, only to be defeated itself by its own implosive greed, forced back into the socialist ethic of state management and ownership of key parts of the economy.

But the sharper paradox may well be that, when all is said and done, the only source of renewal lies in a chastened re-emergence of the same market philosophies that have proved so fragile.

Ultimately, the hope of revival lies in a rediscovery, perhaps a redefinition, of the baby boomers' playbook: By ingenuity, by innovation, by hard work, all may be redeemed.

It is a philosophy defined most simply by the Victorian British writer Samuel Smiles: "The spirit of self-help is the root of all genuine growth in the individual."

The challenge is to harness the belief in the individual ability to mold destiny - not just in the United States, the world's traditional economic powerhouse, but also in China and India, where the power of individual will and ambition is emerging as the motor of economic growth.

The financial crisis still has many phases to run, not least in the questions of blame and leadership that will decide the political price and consequences of this vast meltdown.

Many people now are looking for leaders able to acknowledge the gravity of the situation without losing sight of the potential for a new start - realism and hope combined. That will have an impact as much on the American presidential vote in November as, say, on the midterm contest in Britain between David Cameron and Gordon Brown.

In both, the financial crisis has left a lot of people looking not so much for experimentations but experience, safe hands not vague promises.

But those who are offering the vision of safety, like America's Republicans or the British Labour Party, are also those who presided over the breakneck boom that created the bust.

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