Unemployment – Inflation – Energy crisis: “Growth rates halved after the oil crisis” – What conclusions can be drawn from the oil crisis of the 1970s?

What does today’s energy crisis have to do with the oil crisis of the 1970s? The structural problems –Despite the different messages– were never overcome. At the same time, the oil crisis of the 1970s can be considered as “blueprint” for future development.“Oil crisis of 1973, which at the same time became an inflation crisis worldwide”

> > What I wanted to say by Helmut Schmidt (book) <<“In the case of Willy Brandt, it was the other way around over time than with Kohl. Brandt had great authority during his first four years as Chancellor. For the first oil crisis of 1973, which at the same time became an inflation crisis worldwide, he did not have the necessary economic decision-making power (I was already his third finance minister!).

1970s oil crisis had far-reaching effects on the world economyThe 1970s oil crisis had far-reaching effects on the world economy and, above all, on theunemploymentand inflation pressure. This was triggered by the so-called oil price shock, which is due to a combination of geopolitical events. In October 1973, the Middle East Arab states declared their boycott to members of the International Monetary Fund (IMF). This was a reaction to Israel’s military support in the Yom Kippur War in the sameyear The Arab member states also increased the prices for crude oil products and refused their deliveries to non-member countries of the IMF, resulting in a severe oil shortage. As a result, the global oil price abruptly went up, which ultimately led to the so-called “oil price shock”.“Growth rates after the oil crisis were halved compared to those in the 1950s and 1960s”

> >Confessions of an economic hit Man by John Perkins (book) <<“No one was able to estimate the full scope of the oil embargo at the time. We had our theories, of course, but we couldn’t foresee what became recognizable in the following years. Today we know that post-oil crisis growth rates were halved compared to those measured in the fifties and sixties, and that they were under a significantly higherinflation pressure had to be generated. Growth was structurally different now and no longer created as many jobs, so unemployment increased. To top it all off, the world monetary system was also severely blown; The fixed exchange rate system, which had been in place since the end of World War II, collapsed.”

“Growth was structurally different now and no longer created as many jobs, so that unemployment increased”This had far-reachingimpact: Many countries were unable to pay the rise in oil prices and had to get higher loans. As a result, inflation increased rapidly, since more money was needed to buy the same goods. Unemployment also increased as many companies suffered from rising inflation and had to go to the horizon or went bankrupt.“Folgement of the first oil crisis” – “Generation of the “73s” about this. It is characterized by mass unemployment”

> > Fully employed by Karl-Heinz Paqué (book) <<“It’s the generation of the “73s” that’s what this is about. It is characterized by mass unemployment, which arose from 1973 as a result of the first oil crisis and then never disappeared. With the exception of the economic historians, practically all members of this generation – whether experts or not – have removed their memory from their memory until 1973 or never really noticedtaken. … Full employment ended almost abruptly when it began, following the first oil crisis in 1973 and in the course of the subsequent serious recession. … In fact, since 1973, unemployment in Germany has become a permanent problem: After the gradual increase after 1973 and again after 1982 (in the wake of the second oil crisis!), the level ofUnemployment rate remarkably constant, at a level of about nine percent.”

“full employment ended almost abruptly when it began, following the first oil crisis in 1973 and in the course of the subsequent severe recession”Many countries have felt the consequences of the oil price shock in the form of rising unemployment and inflationary pressure or high debt burden. Both are directly related.“Awareness of the political elite and the awareness of the population are widely apart”

> > The pilot – Helmut Schmidt and the Germans by Martin Rupps (book) <<“The awareness of the political elite and the awareness of the population are widely divergent. The tone of Helmut Schmidt’s great government statements is of a historically unprecedented rigidity. Of course, the oil crisis and other factors caused the economy to crash, … Unemployment is particularly expensive – in 1975 the Federal Labor Office had to pay 87.3 percentSpending more money than in the previous year, at the same time income is only increasing by 15.6 percent compared to 1974. The federal government needs a supplementary budget for the billion hole, it is incurring new debts. Willy Brandt’s successor sees himself doubled: He inherits an expensive welfare state that has created expensive claims and is in a whirlpool with his governmentEconomic crisis that the world has not experienced since the war.”

“Unemployed people are particularly expensive – in 1975 the Federal Labor Office has to spend 87.3 percent more money than in the previous year”In fact, today about the sametroubletalked. The oil crisis of that time has only solidified, despite all the improvements in energy efficiency and well-intentioned Sunday speeches. The entire economic miracle model in the post-war period was built on cheap energy. The next energy crisis –with expensive energy bill– will also lead to inflation, rising unemployment, lower economic growth and certainly quite different upheavals.