The idea of shutting down the entire government and economy for a month every summer was probably invented in Athens 2,500 years ago. And it's caught on: Starting this weekend, the entire continent will grind to a halt as 500 million people head for one another's beaches for a month.
When they return in September, there'll be new clarity. The world of Americans and Europeans will have transformed from one of crisis to one labelled "recovery." Growth is returning to Germany, Britain, the U.S. and other big centres, and the troubled economies of Greece, Spain and Ireland are being repaired in relatively non-harmful ways by intelligent governments.
But a return to growth is not a return to certainty. That's now gone forever. Certainty, as I've learned during a six-country tour in which I've visited scores of Europeans in their homes and workplaces, is the main victim of the crash: No longer are jobs, houses, savings or futures sure in the Western world.
And that's the question now looming over the world: What's stable and reliable? What worked? What sort of life is worth pursuing, what sort of policy and leadership is worth electing, if so much can melt away in an instant?
The first thing to remember is that the crisis has been contained, and the most important features of our world have remained stable, because our major democratic institutions worked. When markets proved to be as capable of cascading destruction as they are of escalating creation, it was big governments and transnational institutions that worked. It was independent central banks that worked. It was regulations, when present, that worked. And in the countries that recovered quickest, it was well-funded social safety nets that worked.
The latest evidence of that was provided this week by the first major study of the recovery by economist Alan Blinder of Princeton University and Mark Zandi, chief economist of Moody's Analytics. They concluded that Barack Obama's $1-trillion stimulus package had the crucial effect of preventing a major recession from becoming a devastating 1930s-style global depression. The stimulus, they said, "has done what it was supposed to do: end the Great Recession and spur recovery." Along with equally vast injections from Europe, it kept the slump from spiralling into something far more ruinous.
The second thing to remember is that this was not a global crisis. Quite the contrary: It was the end point of a new readjustment. In the most populous two-thirds of the world, this has been a period of increasing growth and prosperity only mildly dusted by the grey ashes from the West.
When it began in earnest in 2008, I was in Shenzhen, China, speaking to officials who were baffled to find that a million workers had failed to return from the Spring Festival holiday. It seemed that the collapse of orders from the U.S. had precipitated a Chinese crisis. By the end of the year, however, the workers had returned - though on new terms. City officials were forced to raise the minimum wage from 450 yuan ($68) to 750 ($113) and then to 900 ($136) a month; this year, they've raised it to 1,100 yuan ($166). Their city still faces a labour shortage of about 20 per cent, as officials worry that their raises have driven the cheap-garment trade to lower-wage Bangladesh.
And, indeed, we saw the other shoe drop this week (even if it was a hastily stitched canvas high-top with a questionable logo). Bangladesh announced that, in the wake of months of rollicking garment workers' strikes against deplorable pay, the minimum wage would rise by 80 per cent, from 1662 taka ($25) a month to 3,000 taka ($45).
That's the other answer to the question I posed last week: Was the boom worth it? If you look just at the West, real purchasing-power incomes of working people improved only slightly, if at all, over the past 15 years.
But it's probably better to look at it this way: Our living standards remained exactly the same, and our large governments and institutions prevented them from deteriorating. And those in the East improved dramatically, as we used our non-changing incomes to buy their products. The boom-and-bust period was essentially a transfer of gains from the privileged centre to the margins. If we can hold on to what we've got, then the experience was worth it.
Doug Saunders