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Remembering 9/11 and Its Economic Fallout

Seventeen years on from the terrible loss of life, we remember September 11 and its victims. An immeasurable human tragedy with a lasting economic impact.

A Shock Felt around the World

Where were you when you heard about the attacks on the twin towers of the World Trade Center in New York?

The same question has been asked about the death of Princess Diana. An earlier generation will remember where they were when they heard that President John F. Kennedy was assassinated.

Most of us above the age of 25 can recall the time, the place and the circumstances under which we found out in real time (or afterwards) what happened on that tragic day of September 11, 2001.

For those of us in Asia it was late evening when regular television programmes were interrupted to screen live pictures of the North Tower of New York’s World Trade Center in flames.

In New York it was 8:46am. As we watched the shocking scenes, still unsure of what had happened, believing it was an accident, the full horror of the truth was beamed around the world.

At 9:03am, New York time, a second plane was deliberately flown into the South Tower.

Only later, as the day of terror continued, did the world learn that United Airlines flight 93 had been hijacked and crashed in Shanksville, Pennsylvania, and that another attack had been perpetrated on the Pentagon in Washington DC.

As the world remembers the 2,977 innocent people who lost their lives, we must not forget the many thousands more whose lives were changed forever.

The heroic first responders, the injured, the survivors and those on the ground who watched the horror unfold, all began the rest of their lives on that day.

Lives with the indelible imprint of trauma in their psyches, their bodies and in their hearts.

Economic Impact

After the attacks, the stock market was shut down for four trading days for the first time since the Great Depression in 1933.

On September 17, the stock market was reopened to experience one of the worst singular day drops in Dow. With a dip of 7.13%, it closed at 8,920.70 making it a 617.78-point loss.

This unfortunately worsened the already painful and damaging 2001 recession that began in March that same year that left the economy contracting 1.1% during the first quarter, 2.1% in the second and 1.3% when the attacks hit in the third quarter.

Thus, extending the recession till November.

War threats continued to drive down the Dow for an added year until it hit rock bottom on October 9 the following year when it closed at 7,286.21 points, a 37.8% decline.

No one was sure if the bull market was in session until the Dow hit an unprecedented low on March 11, 2003 when it closed at 7,524.06. Unemployment was also at a steady growth till June when it reached 6% at the peak of the recession.

The War on Terror

On September 20, 2001, then President George W. Bush declared a ‘War on Terror’ by launching a war in Afghanistan in a quest for justice against Osama bin Laden who was once leader of the terrorist group Al-Qaeda that claimed responsibility for the attacks.

An estimated US$29.3 billion in emergency funding was utilised in the first year alone.

On March 21, 2003, troops were sent to Iraq on order by President Bush to seek out weapons of mass destruction that were claimed to be found by the Central Intelligence Agency (CIA).

He also added on that former Iraqi leader, Saddam Hussein had aided Al-Qaeda operatives. This in turn made way for Congress to appropriate US$36.7 billion in emergency funding that same year for the War in Iraq.

Costs of both wars kept on accumulating and by the end of President Bush’s second term, the War on Terror amounted to US$1.164 trillion followed by President Barack Obama who spent US$807 billion during his two terms and President Donald J. Trump who has budgeted for US$156 billion which brings costs to a total of US$2.126 trillion since the war began.

Financial Crisis

However, the most significant impact was how the expenditure on defence led to the American debt crisis.

Discounting the War on Terror, America’s debt would’ve been US$17 trillion or less, an approximate 93% of the country’s economic output.

This resulted in reduced budgets for stimulus courses that were meant to carry the country out of the 2008 financial crisis.

The cycle of decreasing jobs resulted in a lower tax revenue, leading to increased debt which also caused less funding for infrastructure replacements and reparations.

Increased levels of debt became a crisis when Tea Party Republicans resisted a raise in the debt ceiling. There was a call for a limitation on Medicare benefits instead of military expenditure which eventually led to the first downgrade of American debt according to Standard and Poor’s.

A refusal to fund the government or raise the ceiling was once again denied in 2013 that led to a 16-day shutdown of the government and spurred global fears of America’s default.

A choice to focus on austerity measures instead of creating jobs led to an ongoing lack of economic growth. Democrats and Republicans still accuse each other of debt increases when they aren’t in power, and yet, both parties still continue to spend when in control of Congress.

Never Forget the Human Impact

For the families of 1,113 victims of the attacks, there is the added pain of having no confirmation of their loved ones’ deaths. ‘40% to 50% of the families didn’t have any body parts returned to them,’ says sociologist Professor Arnold Korotkin.

Sons, daughters, husbands, wives, brothers, sisters, fathers, mothers died at the World Trade Center, but such was the power of the fire and the collapse that no biological remains have been found.

Despite the best that current forensics techniques can offer, the search has come to an end… for now.

The unidentified remains are stored with dignity in a climate-controlled repository, open only to the families of the missing. Appropriately, this privacy is provided within the National September 11 Memorial Museum.

Remembrance

When we think of that September day we should remember those who died, those who survived and all of their families, their friends, their colleagues, their former classmates, everyone who knew them or whose lives they touched.

The ripples of grief spread out from Ground Zero and into the future so that today, 17 years later, we need only say 9/11 for everyone to revisit that moment when they first heard the news that terror had struck.

Sandy Dahl, wife of Flight 93 pilot Jason Dahl, said ‘If we learn nothing else from this tragedy, we learn that life is short and there is no time for hate.’

Words to live by.

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