An empire ends, numerous nations are destabilized, and life ultimately goes on in:
CHAPTER 17: The Second Great Depression (Part One)
To understand the existence of the Second Great Depression, one must look beyond the surface of what appeared to be a mostly stable world. The Soviet Union was cleaning out the last of the pro-NKVD hideouts in the far north, the Western world was experiencing a period of economic growth and prosperity unseen since the 1920s, and the great empires of Europe and appeared they would never end. Below the surface, however, was massive amounts of corruption, the endless reliance of Japan on imported oil, and serious economic flaws within both the protectionist economies of western Europe and those forcibly oriented towards free trade by the West's great economic powers.
Japan herself was mostly a protectionist economy, though a weakness existed in the form of oil imported from foreign countries, particularly those in the Middle East. What Mexico could not provide was made up for in exports from countries such as Iran and Saudi Arabia, among others. This weak link became weaker during a period known as the "Arabian Winter", a time of instability and open anti-colonial revolt due to the massive disparities of wealth and a perceived lack of support to the Palestinian paramilitaries during the ongoing low-level conflict in the Abrahamic Holy Land. To outsiders not paying attention to the region, the end of Saudi hegemony over the Peninsula came as quite the such. But such sentiment has been boiling for ages, from the presence of British colonial ventures to the increase in the influence of Wahhabi Islam in recent years to continued Western meddling in the affairs of the locals
January 22, 1971 marked the beginning of the end of the monarchy of Arabia. A whole week passed with the palaces and government buildings besieged by rebel forces before many were stormed and captured. Much of the Sa'udi royal family was captured and executed after an extremely dubious show trial. The Arabian "Revolution" was just beginning, and the fall of the nation to a small vanguard party of questionably democratic forces utterly shocked and alarmed Arab neighbors and local British administrations alike
[1].
The rebels were not all homogenous in their views. Some supported more moderate strains of Islam as a state religion, others promoted secularism, and an even smaller subset (mainly a small group of intellectual Marxists) suggested a policy of state athiesm. Most individuals speaking in favor of this third category were quietly purged within the first month, and the new "Revolutionary Arab Republic" would become the world's new pariah state for 1971 and a sizeable chunk of 1972. The attitide of the new government would range from numerous attempts at the destruction of older reactionary amd monarchist symbols to the advent of a "national revolution in culture and thought"
[2] to outright emulation of the French Revolution of the 1790s with a distinctly middle eastern flavor. The "stains of Wahhabi Islam" would be wiped from the country in a massive purge of loyalists to the old order... if not for a counter-coup attempt and the collapse of the country into civil war. The Republicans were a fringe group, going against more traditional local values with a peculiar proclivity towards Western democracy as it existed in Europe, particularly France in the modern era.
Clearly, not everything was sunshine and roses. The short-lived government was fervently nationalist, anti-colonialist (more explicitly anti-British), anti-communist, and in many aspects anti-Semitic
[3]. There were a few good things the new revolutionary government was doing for the loyal citizens within its borders
[4], but there were a number of shortcomings and misguided attempts to bring the nation forward beyond just being wealthy off of oil profits. Their attempts at emulating the French Revolution in 1972 and 1973 were not only deeply unpopular, but doomed to failure from the beginning. The "reign of terror" might have only lasted fifty days between April, May, and June of 1973, but it ended with the nationalization of Arabia's oil fields and refineries... and more profoundly, thousands extrajudicially murdered through purges and resistence suppression combined. A counter-coup, involving Western arms and a rare coordination of Japanese and British intelligence coordination with more "moderate" (or whatever they thought that meant...) rebels acted quickly in terminating the so-called "republican" regime in the former Saudi Arabia. The government and its shadowy bureaucrats, cadres, and leaders alike all perished within days, and took to the airwaves to announce that "...the collective national nightmare that Arabia was facing is now over."
[5]
The new monarchy, an absolutist one like the House of Sa'ud and quite devoted to religion, was unsurprisingly hostile to republicanism, and considerably more surprisingly hostile to extremists, particularly Salafists and Wahhabists. The new state-sanctioned inquisition made quick work of the more influential leaders, and while a small but considerable number of more social reforms were maintained from the brief era of the pseudo-Jacobinist "Revolutionary Arab Republic", the new leader of the nation, an undistinguished middle-class military leader who was quick and decisive in taking power who stylized himself as "Sultan Ahmad al-Tabuk" was at first friendly with the British and Japanese delegations, though in spite of his more traditionalist lean on authority was a staunch nationalist.
There was an attempt at yet another coup in Arabia, to install a puppet leader who would turn the other way when it came to various abuses from the colonialists and the corporations seeking to make a quick buck. Every last detail went wrong, from the planning to the execution to the escape, in that you could say the plotters each rolled a natural one on every single one of their rolls. Following this, the Sultan cut ties with his former benefactors and embarked on a scheme of total nationalization of all European-owned facilities within the nation, including and especially the oil fields.
The nationalizations helped send the market into a frenzy, but it was what would later be known in the West as the "Persian Gulf Blockade" that broke the proverbial camel's back, so to speak. Oil from Iran owned by European (predominantly British) companies was still permitted to sail through, but an unreasonable toll equivalent to £2,500 (USD $6,250)[6] to simply pass through the Strait of Hormuz was levied. Some would pay, others would attempt to pass through without doing so. Such crews taking the latter action were either sunk or detained. Eventually, the British Government reluctantly entered negotiations with the Arabian government for a lower strait toll, which was agreed upon and slashed the original toll by forty percent, with the concession being that the British (and by extension, the rest of the European Entente) would recognize the new "Holy Sultanate of Arabia" and cease support of dissidents within their territories.
[7][8] The British would agree, but the damage was already done. While the politics of the Middle East would calm down for a few months, a mysterious series of explosion at numerous Iranian oil refinery brought the world's economies, already slowing down since 1971, into freefall. June 8, 1973 would forever be nicknamed as "Black Friday"
[9], and the "Black Weeks" that followed would see many lose their life savings
[10] and investments. Businesses and banks collapsed across the world, and though in Japan the major financial cliques were bailed out after some spending cuts to the propping-up of their client states in the Mainland
[11], many smaller businesses were left high and dry, and would later be acquired by the zaibatsus at discount prices, helping to further cement corporate dominance (alongside military dominance) within the Empire. And with the limp-wristed civilian government limited in its power to do much of anything beneficial for the people of Japan, the divided factions of the military took advantage of this situation to strip them of further power and essentially confine the Prime Ministership to a rotating presidency between the Army, the Navy, and the Air Force.
---
Vietnam's pseudo-fascist government would collapse after the Can Tho Riots saw dozens die in sectarian conflict and culminating in the Vietnamese military turning on its "civilian" leadership headed by Ngo Dinh Diem. (The infamous Hanoi Massacre of September 1973 was the breaking point.) An interim military junta took control of Vietnam after Ngo's sudden death
[12], but with their effective control limited to the capital city of Saigon and the rest of the country collapsing into anarchy, the Thai government, even with their own struggles in this era, deployed military forces into the deteriorating Vietnamese state and began to maintain a costly occupation with the intent of establishing a transitionary government. This would be achieved in 1976, after three years of military control and a puppet governor taking orders from Bangkok. Thai authorities were not under the impression that the people of Vietnam were ready for democracy, and as such the governor would voluntarily step down and allow a Thai-appointed military junta to take power. The Cambodians and Laotians were still pretty perturbed that their homelands were split between a rock and a hard place, yet there wasn't all that much they could do outside of protesting their conditions and joining in more larger protests demanding economic reform. While Thailand would weather the Depression better than most despite their strong ties with the leading country of the Co-Prosperity Sphere, the "Indochinese Problem" as it would come to be known locally and internationally would continue to plague the country throughout the rest of the 1970s and into the early 1980s. Eventually they would be deemed ready to govern themselves once again, and when that day comes, the leader of Indochina will have to balance keeping Vietnamese, Laotian, and Cambodian equal with taking "advice" from Bangkok.
Continuing on the effects of the crash in Asia, The Chinese Civil War, going on for nearly fifty years now, finally ended on September 9, 1976, with representatives from the Communist government in the north, the KMT-Collaborationist government in the south. Why this was not settled five, ten, or even fifteen years earlier is a mystery and an enigma in and of itself, but it's generally agreed that the leadership of both countries had the unrealistic and unsustainable goals of uniting the former territories of the Qing Dynasty under their respective administrations. Both nations suffered (and would continue to suffer) in some form or another from the geopolitical effects of the Second Great Depression, but with the North once again securing ties with Moscow and with few international connections beyond fraternal socialist relations with Iberia and Illyria, their economic downturn was next to nonexistent. The South only agreed to the Treaty simply because of their own downturn and strong connections (on paper, anyway) to the government in Tokyo. A new era would begin for both nations, not one of sunshine and roses and friendship but one of relatively peaceful co-existence. A few million were dead at the end of it, the lives thrown away in trying to reach a lofty goal. What the future held for both Chinas was uncertain, but it is hoped that the enmity between the two would subside, and perhaps cooperation could blossom in the far future. This "Two Chinas Policy" would continue until a mostly peaceful reunification sometime in the early 2010s, though until then a coalition government whose policy could best be described as "social democracy with Chinese characteristics" came into power, and while shifts towards more Western styles of liberalism (on the far-right) and market socialism (on the furthest left of majorities) would occur, the center-left government would ultimately continue to hold for some time.
The rest of the world has its own troubles which will be explored soon. France has been seemingly unable to maintain a government for more than three years at a time during this decade, while Italy's transition from fascist dictatorship to a parliamentary constitutional monarchy will be a rocky one indeed. Poland is dealing with terrorist attacks from the OUN, and Ukraine's irrendentist claims to surrounding territories are causing unneeded tension in Eastern Europe. Russia is picking up the pieces from an internal war infinitely more destructive than the First World War and the Bolshevik Revolution combined. Britain is dealing with a sizeable paramilitary war between die-hard Zionists and local extremist Palestinians, and the United States is experiencing massive riots, protests, and general instability.
Will this weary world ever find peace again, at least for a moment?
[1] This, of course, adds so much more pressure to the British Empire. These wars won't help the Brits out a whole lot, and will help bring about the dissolution of the British Empire, a process that will be comparatively less bloody, painful, and destructive than Japan's now-inevitable implosion. Meanwhile, the
[2] Not OTL Chinese levels of cultural revolution, mainly because it was cut short from a counter-coup.
[3] More the government than the people, but most individuals practicing Judaism are simply expelled rather than brutally murdered. A number find themselves radicalized and joining forces with the Zionists in British Palestine, but the situation is far from ideal. As for minority Christians in this period of time, they get off easy, they just have to pay higher taxes and are disenfranchised of the "vote", whatever that means to the government at the time.
[4] This is not an attempt to whitewash or condone the post-Saudi "republican" regime in Arabia. It's explicitly a mix of the excesses of the French Revolution and a futile attempt at something like OTL's "Great Proletarian Cultural Revolution" in China. The leadership of this government are all original characters and even in modern history lessons ITTL they're pretty obscure.
[5] I don't need to explain this quote, do I? I might add names of original characters, but most of these individuals are either nobodies in OTL, original to TTL, or a combination of both. (For technical reasons, it's both.) For now, I'm just not up for it.
[6] Assuming an exchange rate of roughly 2.5 British pounds to 1 U.S. Dollar in this world's 1973, with the exchange rate affected by butterflies, inflation and the like. I'm not a bona fide expert in economics.
[7] "Why didn't they transport the oil across Iraq into Syria and have it shipped to a port from there to mainland Europe?" Well, the Middle East has been under pressure for quite a while and most colonial revolts up to this point have been suppressed. With the end of Saudi Arabia and the continued low-level conflict in Palestine distracting the Brits, there's a renewed sense of hope for independence in the region, and there are plenty of people willing to take up arms against the most powerful empire of the modern era.
[8] Japan voluntarily shifted its orders of oil out of Arabia following the 1972 diplomatic crisis towards the safer bet of Iran. Mexico only had so much oil it was producing, and it could only cover most of the military OR most of the civilian demand, but not both. This, naturally, was allocated to the former, and the Japanese civilian automobile market was virtually obliterated for the rest of the 1970s. More fuel-efficient diesel-burning models would be created and marketed to the rest of the country by 1980, providing light relief with trade-ins but still out of reach to many working Japanese people.
[9] The day after Thanksgiving in the USA will not share a name with the day considered to be the beginning of the worst economic crisis of the twentieth century. The holiday season still begins after Thanksgiving, and for decades to come nobody will dare to start advertising and selling items for the December holidays before Thanksgiving Day in the United States. (Commercialism, with less money in the pockets of the typical Italian, American, or Italian-American, takes quite the hit throughout the 1970s before rebounding sometime in the '80s.)
[10] Legislation was passed to insure one's bank savings in the United States during the Roosevelt era, but was quietly repealed in 1950 under President Taft. The life savings of many people who trusted in banks to hold their cash were, in turn, wiped out.
[11] Currency speculation helped them back in the 1930s. The 1970s is a different time in a world so radically different and unimaginable from someone living four decades prior, and the crisis more directly affects Japan now than it did in the 1930s.
[12] The cause of his death is disputed to this day, not particularly the fact that he's more dead than Japan's economy right now. He was never a popular leader, only coming into power with appeals to force.
A/N: I admit that this update isn't as high-quality as many of my previous updates. It's a lot to cover and I'm losing track of my own canon and I'm just a very disorganized and uncertain writer. I hope you all like it, though! Constructive criticism is welcome, as always! More may be added and clarified within the first 24-48 hours of this post.
Addendum: Massive edits made since posting this months ago! I've decided to split this chapter into two parts, seeing as I wasn't sure what I wanted to write about and wanted to spread this out a bit. Hope this makes more sense than whatever I came up with back in December.