Even before the Panic of 2008 sent financial markets into turmoil and launched what looks like the worst global recession in decades, talk of American decline was omnipresent. In the long term, the United States faces the rise of Asia and the looming fiscal problems posed by Medicare and other entitlement programs. In the short term, there is a sense that, after eight years of George W. Bush, the world, full of disdain for our way of life, seems to be spinning out of our--and perhaps anybody's--control. The financial panic simply brought all that simmering anxiety to a boil, and the consensus now seems to be that the United States isn't just in danger of decline, but in the full throes of it--the beginning of a "post-American" world.
Perhaps--but the long history of capitalism suggests another possibility. After all, capitalism has seen a steady procession of economic crises and panics, from the seventeenth-century Tulip Bubble in the Netherlands and the Stop of the Exchequer under Charles II in England through the Mississippi and South Sea bubbles of the early eighteenth century, on through the crises associated with the Napoleonic wars and the spectacular economic crashes that repeatedly wrought havoc and devastation to millions throughout the nineteenth century. The panics of 1837, 1857, 1873, 1893, and 1907 were especially severe, culminating in the Great Crash of 1929, which set off a depression that would not end until World War II.