We’ve blown it – the credit crunch has burst an illusory bubble and left us standing on the brink of a black hole
30.10.2008

As the speculative bubble burst so did a way of life. Indeed, more than just a disaster in financial terms, the collapse provides a poignant symbol for the failure of a shared vision: the notion that we can maximise potential – both financial and otherwise – with the minimum of effort. rheingold has repeatedly described this ‘digital way of life’ in numerous studies and publications.

Worryingly, current rheingold research suggests that we might be on the verge of societal mood swing similar to the one we went through after the dot-com collapse and the attacks on the World Trade Center in 2001. But the credit crunch is likely to be more enduring: the aftermath of 9/11 conjured up a similarly horrific scenario, but for most people it was much easier to comprehend. The collapsing towers were symbolic of crashing stock exchanges, economies and job markets. But the collapse was finite. This time around though, we are worried the financial crisis might prove endless. Thus, we are faced with an incomprehensible scenario in which we appear to be being sucked into a black hole along with our property, our jobs and our pensions.

The psychological background is as follows: far from being the sole preserve of investment bankers, investment poker was being played right across the social spectrum. We have all be playing! For years now the television has been evangelising quick and easy ways of making it big: “Deutschland sucht den Superstar“ [German Idol], “Über Nacht zum Millionär” [Millionaire Overnight]. Hip youngsters want to hit the big time by shortcutting all the hard work and self-development that used to be part and parcel of ‘earning’ success. “Get rich or die a sad loser.” Likewise, adults now ‘take a shot’ at achieving the perfect family ‘at the push of a button’ – but without the hurt, guilt and conflict previously attached to it. Now a service society, elsewhere we are delegating all the dirty sweaty work to Chinese factories.

This cultural phenomenon shows that right across society, and not just on the financial markets, illusionary ‘maximised’ realities are being pursued at the price of personal estrangement. Internet communities for example represent bubbles of social speculation: many of us now have 200 virtual friends but a dearth of real-life friends. The financial crisis has made the collapse of our collective dream incredibly palpable. Since “speculating to achieve the max” has effectively consumed any other purpose in life, we now find ourselves on the brink of a black hole. It isn’t just our savings, our jobs and pensions but our entire way of life we stand to lose. The basic principle of shareholder value – up to now the dominant credos in our society – has suddenly fallen into disrepute.

The very incomprehensibility of this has caused us to go into complete denial. We know that banks go bust, but dismiss the idea – something that prevented a run on the banks during the early days of the crisis. We Germans, looking for reassurance, cling to the banks for stability – and are surprisingly re-establishing the role of a strong State, which we hope will stand mightily before the gaping abyss fending off the impending calamity. A kind of paralysis is spreading through the economy. The result is a self-fulfilling prophecy: we fear recession and stupidly do just those things that will succour it: stop investing, cut back on jobs and reduce consumption.

Given these findings, rheingold researchers are concerned that the long-practiced tactic of ‘patching holes’ in the State and economy will not be sufficient to fill the present chasm – it is after all the very purpose and meaning of society that is so badly holed. Without painful social reform, without comprehensive restructuring of the production system, without reflecting on our cultural values, the current crisis cannot be resolved. But that’s just where our chance lies.

(Photo: Deutsche Börse AG)

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