Writing in The New Republic, Professor Alan Wolfe of Boston College counters expectations that this year's economic crisis will cause dramatical social and political change in America:
"[T]he anger that greeted the Great Depression is of very different quality than the anger apparent now. Seemingly like the 1930s, Americans are denouncing Wall Street. But their hostility is too diffuse and incoherent to help them channel it constructively... Now, all of a sudden, they are speaking like Populists of old, attacking greed and calling for regulation. Their protest, alas, is more symbolic than concrete. As such, we are unlikely to witness blame assigned where it belongs; nor are we apt to see the passage of serious reforms dealing with long-term structural changes in the economy or any diminution of lobbyist influence. A scary economic moment will transform itself back to politics as usual in the blink of an eye.
"The New Deal, finally, gave rise to extremist politics. But in those days most of the demagogues--Father Coughlin, the activists of the American Liberty League--were outside the halls of power. These days, voices of the extreme right (and to a lesser degree the extreme left) sit in the House of Representatives. Capable of stopping the bailout the first time around, they are likely to lose the next vote tomorrow. But win or lose, the bailout represents a movement of the extremes against the center. For that reason, the partisan polarization that has characterized American politics over the past two decades will continue, and perhaps even be strengthened if the economy does not respond.
"It is true that, as many have pointed out, we are about to enter a period in which regulation is no longer a dirty word and laissez-faire no longer the touchstone of economic policy. But this does not mean that something coherent and disciplined will triumph."
One pertinent argument Wolfe does not make is simply that only a few events can be momentous enough to trigger a lasting transformation. Many major events seem to qualify at the time - but looking back on them a few years later one sees less evidence of a lasting impact.
The political tone of the piece suggests the author would reject a further point - but it is worth airing. There is no real and palatable alternative to America's free market capitalism. Much tinkering on the margins is to be expected, and is a continuing part of American politics. In particular, the threat of protectionism to free trade should be taken seriously. But whatever the anger being directed at Wall Street, the United States should not be expected to adopt socialism or a planned economy. The economic case against these methods is far better established than in 1929, and too many individual cases all over the world demonstrate that it can be as easy and damaging to fall into the trap of overregulating as to fall into the trap of underregulating.