The Dow Jones Industrial Average has fallen below the 7,000 mark for the first time since October of 1997. As I write this the index is trading at 6,849.79 points, down from a 7,056.48 opening this morning. There are still over four hours of trading left in the day.

Why the continued slide? Well, for any number of reasons. AIG is reporting $61.7 billion fourth-quarter losses and Uncle Sam is pledging another $30 billion in new capital that we don’t have. The banking problem isn’t only limited to our shores and many worry about the stability of European banks. While consumer spending was up in January (in relative terms), analysts are reported to only see it as a temporary rise. Inflation is on the rise and Warren Buffet is predicting an economy in shambles for at least the rest of 2009.

What does this mean politically? It gives the Obama Administration and its allies in Congress more cover to pass massive and unnecessary spending bills, all while increasing government’s control over the lives of Americans. Rahm Emanuel has already gone on record stating that he wants no crisis to go unutilized in order to accomplish political goals. The American public, mostly in panic mode, will be willing to accept just about anything that is sold as a panacea to their economic ills. It’s the 1930′s all over again.