Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SUNDAY, April 7, 1991 TAG: 9104110047
SECTION: HORIZON PAGE: D-4 EDITION: METRO
SOURCE: Reviewed by JACK FRAZIER
DATELINE: LENGTH: Medium
When Batra's book first appeared, many reviewers panned it, calling it a "doomsday" book. Now, several months into the recession of the 1990s, more establishment publications and economists are starting to take it seriously.
Perhaps what angered some was not that Batra had the audacity to forecast economic trends far ahead of most other economists, but that he dared to tell why the 1990s recession may well lead to our second "great depression" within 60 years.
Conventional wisdom holds that another depression like that of the 1930s is no longer possible because our banks are protected from failure by the FDIC (Federal Deposit Insurance Corp.) and the wealth of our nation is so widely and democratically held that investment capital is secure from sudden fluctuations.
Using figures available to anyone, Batra shows that the concentration of wealth in the hands of the top 1 percent of "U.S. adults or families" during the 1920s and 1980s is frighteningly similar.
Says Batra, "during the 1920s there was a sudden sharp surge in the inequality of the distribution of wealth . . . in 1922 1 percent of U.S. families owned 31.6 percent of the national wealth, but by 1929, only seven years later, their share had risen to 36.3 percent."
In 1969, the share of the national wealth held by the top 1 percent of adults and families was 24.9 percent. By 1983 it had shot up to 34.3 percent. In 1984, the Reagan administration tax cuts for the wealthy gave it an additional boost, and it's still growing.
Among the other indicators Batra cites are more bank failures than at any time since the 1930s, all-time high trade deficits, escalating business bankruptcies and growing public and private indebtedness.
Jack Frazier is a West Virginia free-lance writer.
by CNB