alternatehistory.com

Killing me softly

As 1973 rolled around the corner, President Robert Kennedy was, for the second time, sworn into office. The world was still recovering from the big scare of the "Second Border Conflict", but the President's strong stance on the situation seemed to please many. This was not, as many Republicans liked to claim, a man without foreign affairs experience. Kennedy had handled the situation with strength and decisiveness, and many compared it to his brother's handling of the Cuban Missile Crisis a decade earlier.

One man who had not handled the situation very well was Premier Leonid Brezhnev. The leader of the Soviet Union had seem in Kennedy's threats of intervention in a Sino-Soviet conflict a direct offence. Four years earlier the two man had negotiated the Prague Deal, bringing to a end the American war in Vietnam and Soviet presence in Czechoslovakia simultaneously. It was perceived around the globe as a great diplomatic breakthrough.

What it had been in fact was a calculated exchange to strengthen each individual foothold on power. It had suited the Premier, but now Kennedy wanted to police the world. Getting his country involved in matter's that did not concern them. The United States didn't even recognize the People's Republic of China legitimated status as a nation. They still clinged to the reactionary tyrant in Taiwan and his delusions. And now they wanted to tell the Chinese and the Soviets what to do?

The young man could become a headache; he would have to learn his lesson sooner than later.

Tales from the Kremlin- Brezhnev, Georgy Zhulovich

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The term Stagflation is a portmanteau of the words Stagnation and Inflation. Up to the 1970's, the two concepts were not seem as interconnected. As a matter of fact, Inflation was, in many ways, regarded as a positive boost for the economy. The idea might seem bizarre to most today, but what we hold as basic economics is, in fact, a relatively new realization on the history of the economical world.

British MP Ian Mcleod coined the term, in 1965. It would, however, only gain prominence in Britain in 1970, when the politician, now lord of the exchequer used it once again to define the economic situation of the country. He would use the term a third time, in March 1973, this time in a interview with Newsweek magazine. Now it would really become popular, and for no small reason.

The beginning of 1973 would see the American economy take a ever so slightly plunge. The term would describe the situation now faced by the United States, were a growing supply of money in face os a economy slowing down provoked adverse and negative effects.

The situation would be downplayed by many, be then politicians, economists or intellectuals. Some, however, would warn that if a external factor was added to the equation, say a decrease on the flow of a certain essential product or material, then the economy could suffer a great shock.

The external factor would come later that year, shocking both the economy, and those that failed to predict it.

The End and the Beginning of a Era, Marcus P. Edginton
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Short update foreshadowing a couple of things. Next update tomorrow!