TIME: Almanac 1993/TIME Almanac 1993.iso/time/120390/1203360.000

Text File | 1992-08-28 | 6.1 KB | 125 lines

                                                                                BEHAVIOR, Page 112

Is the Country in a Depression?


When the economy slumps, so does the national psyche

By PHILIP ELMER-DEWITT -- Reported by Kathleen Brady/New York


    As unemployment climbs, inflation rises and the economy
lurches toward an expected slump, economists issue dire warnings
about "recessionary psychology" -- a pattern of cuts in consumer
spending and investment that tends to feed the downward spiral
and make any economic falloff even deeper. But there is another,
more profound kind of recessionary psychology. It is measured
by psychic indicators rather than economic ones. As people
change their behavior in the face of layoffs, cutbacks or a
sudden drop in net worth, more and more Americans find
themselves clinically depressed.

    This year the symptoms are most apparent in those parts of
the country -- New England, the mid-Atlantic states, parts of
the Midwest -- that have suffered the greatest economic decline.
In the suburbs of Detroit, where sagging auto sales have fanned
recession fears, psychiatric referrals from a local counseling
service are up nearly 20% over the past six months. Business is
also booming at the Massachusetts Psychological Association
referral service, where out-of-work lawyers and former bond
salesmen seek help in coping with stress, anxiety disorders and
panic attacks. Drugstores in the region report brisk sales in
Tagamet (for ulcers), Prozac (depression) and Halcion
(insomnia).

    During the Great Depression of the 1930s, people jumped out
of windows, joined left-wing movements or sought escape through
watching Fred Astaire movies. In the 1970s, they squabbled in
gas lines and drifted into the low-level despondency that Jimmy
Carter called "our national malaise." The current economic slump
-- not yet officially recognized as a recession -- threatens to
be particularly divisive because of the increasing disparity
between haves and have-nots. "In the 1930s, everyone was in the
same boat and knew other people were suffering too," observes
Val Farmer, a clinical psychologist and syndicated columnist
from South Dakota. "The current problems affect people so
unevenly that they don't pull together."

    As always, some people drown their troubles in alcohol.
Others turn to chocolate bars, ice-cream cones or platters of
rich food. In the words of Columbia University psychiatrist Jack
Gorman, "When things are lousy anyway, who cares about
cholesterol?" Many individuals become violent and abusive,
usually to those closest at hand. At the House of Ruth, a
Washington shelter for battered women, deputy director Dan Byrne
reports that the men who are doing the hitting are talking more
and more about the economic pressures they feel.

    In the inner cities, the situation can quickly turn ugly,
polarizing along racial lines, as when black customers organized
an angry boycott of Korean greengrocers in New York City this
year. The city's commission on human rights reported a 7%
increase in the incidence of so-called bias crimes this year.
That trend is reflected in the rise in racial assaults recorded
by Klanwatch, which monitors such crimes across the U.S. for the
Southern Poverty Law Center in Montgomery. "The national
recession has created general unrest," says director Danny
Welch, "especially among white males vying for jobs they didn't
use to have to compete for."

    Psychologists say economic losses are no different from
other kinds of losses. Homeowners have more than capital tied up
in their homes; when their assets decline in a real estate
slump, so does their sense of self-worth. People who have lost
their jobs experience anger, denial and a need to grieve, just
as they would if they had lost a loved one. This is especially
true of the solid, stable employee who has worked in one place
for many years. "That person has a mental contract," says Maury
Elvekrog, a management psychologist in Birmingham, Mich. "Even
though no one told him that he would be taken care of, that's
what he expected."

    The emotional effects can spill over to all parts of a
person's life. In times of crisis, says Columbia's Gorman,
someone who tends toward pessimism will not worry about just the
economy but will also fret about getting sick or wonder whether
war will break out in the Middle East. Barbara McCuen at the
University of Nebraska at Omaha warns that there may be
psychological fallout for the family. "The tensions come out at
home," she says. "A five-year-old may not understand why there
won't be a big Christmas."

    Attitude more than actual events determines how individuals
respond to a financial setback. Joseph Cassius, a clinical
psychologist from Memphis, catalogs people's reactions according
to their personality type. A person whose early family life was
marked by chaotic dislocations such as divorce, he says, will
see a recession as a catastrophic event that could destroy him.
Individuals with dependent personalities who lose their jobs may
feel abandoned and show their frustration by, for instance,
voting against the party in power. Those who usually feel in
control of every situation may be especially stunned by
unexpected economic setbacks. "The perfectionist will think all
his achievements have been to no avail," says Cassius. "The
masochist, by contrast, will now be happy again."


    Some people are calling the current slump the yuppie
recession because investment bankers were among the first to
lose their jobs. Psychiatrists report that Wall Street patients
feel guilty about the easy money they made in the booming 1980s
and are convinced they are being punished for earlier good
fortune. These people are busy lowering their financial sights,
and as the downturn rolls across the U.S., the rest of the
country may have to do the same. That is just what the
economists fear. The trouble with recessionary psychology, they
say, is that deflated expectations become self-fulfilling
prophecies, for both the individual and the economy as a whole.