Nicholas Foulkes: The names have changed, but it feels like Britain in the Seventies all over again

Today's tales of excess are all too familiar to those alive 30 years ago

It was the news that we were at war, well sort of, with Iceland that did it for me: we seemed, at last, to have come back to the Seventies. Only Nostradamus, and perhaps I, could have prophesied that Britain and this remote northerly island of a few hundred thousand inhabitants would resume the hostile relations that had given us one of the most esoteric conflicts of modern times: the Cod War.

For years I have been prophesying that we were on our way back to the era of collective bargaining, the Bay City Rollers, power cuts, the long hot summer of 1976, union domination and the Carry On films that were Britain's cinematic whoopee cushion of an answer to the pretensions of the Nouvelle Vague. Oh for those palmy days when Britain enjoyed rampant inflation and had to be bailed out by the International Monetary Fund, and when the cries of pickets rent the air at Grunwick. People laughed at me, but they are laughing on the other side of their faces now, as we slide into an entropic morass that has all the markings of the Seventies.

Part of my willingness to see a return to the Seventies in the economic collapse is founded on a nostalgia that I, in common with many late baby-boomers, feel for the decade in which we grew up. The sense of the Götterdämmerung has felt like a comfortable pair of slippers that have lain forgotten at the bottom of a cupboard. If you remember the Seventies you remember apocalyptic television and cinema like Survivors and the remake of Quatermass, of bleak best-sellers like Paul Erdman's The Crash of '79 and General Sir John Hackett's The Third World War. And today as the sense of siege mentality has grown stronger, it grows ever more familiar to me.

It seems that everywhere I look there are parallels with the turbulent decade of disco and the Sex Pistols, Tony Benn and Sunny Jim. Take the broadside of the Archbishop of York, John Sentamu, against the short-sellers, who may, but then again may not have been, responsible for the fall of HBOS. It had me thinking of Mervyn Stockwood, the dear old radical Bishop of Southwark who used to wade into public debate on the state of the nation a generation ago, writing in the Communist Party daily, Morning Star, that he had "no intention of shoring up a society which, because of its basic injustice, is at last crumbling in ruins".

And as with our own society seeming to crumble into ruins, it is as an avid student of the 1970s that in the current banking crisis and credit crunch I was able to detect an echo of the secondary banking crisis that threatened to destabilise the British banking system during 1973 and 1974.

The beginning of the 1970s had a seen the "dash for growth" or the Barber Boom, so called in honour of Edward Heath's Chancellor of the Exchequer. But the boom stumbled and fell. Then as now a confluence of events created a crisis: rising oil prices, falling house prices and a stock market collapse pushed some fringe banks towards collapse, leading to a bailout plan by the Bank of England and then the 1979 Banking Act to ensure that it could never happen again. Sound familiar? The story of that crisis is well told in Charles Gordon's book, The Cedar Story, which charts the collapse of one of the most emblematic of these banks, Cedar Holdings. I am not a financial historian, so a lot of the fiscal science goes straight over my head, but the tales of excess, which only really came out as the bank unravelled sound oddly familiar. For instance, the directors of Cedar bought a jet; bear in mind that this was Britain in the early Seventies when a great many of us still took our holidays at home.

Thirty-five years later the gap between the lives of unimaginable affluence of the few compared to the grey drudgery of the many finds its parallel as the sybaritic follies of hedge funders are picked over with a mixture of outrage and envy by the rest of us. Even on the most basic level it seems that the rich were, and are, different: I wonder if I was the only person to learn of corporate dry-cleaning cards only as suddenly unemployed bankers were surrendering theirs.

We have also seen the return of the fat cat as a public enemy. Until recently we were in the grip of what Oliver James would probably call a severe bout of affluenza. For a while it seemed as if we had shed our innate national distaste for the trappings of new wealth; instead we deified those who made money and achieved celebrity. Becoming rich became a parlour game wrapping itself up in the reality TV show culture of instant fame.

Today ostentation, until recently something to be aspired to and emulated, might seem, to borrow a term from the 1970s, like "the unacceptable face of capitalism". Edward Heath's famous remark about maverick businessman Tiny Rowland reminds us that in the 1970s, even during those days of union power and high taxes, there were rich men like Jimmy Goldsmith, Jim Slater and Harry Hyams.

The two-track system of affluence that operated then is in place now, only the nomenclature has changed: back in the Seventies we had tax exiles; today we have "non-doms".

And while the finance crisis is uppermost in our minds, let us not forget that this summer we saw, to mix metaphors appallingly, the reheating of another Seventies favourite, the Cold War, with the Russians reverting to revanchist, nationalist type and invading a small neighbour.

It seemed that power cuts were also back by popular demand with the National Grid warning of possible blackouts this winter, although that threat might now have receded with our inability to pay our rising energy bills.

The Seventies also continue to exercise a cultural hold on our lives. Frost/Nixon, detailing the relationship of a Seventies television interviewer and a Seventies American president, seems set to become the must-see movie of the autumn. The utterly brilliant Life On Mars is the latest British TV show to be remade for the US market, demonstrating that a rock 'n' roll years approach to cop shows is not just a British taste.

For the first time for ages we are feeling the same thing. In the Seventies we all watched more television than before but, with only three stations to choose from, we all watched much the same thing and talked about it the following day. Now it takes a global catastrophe to engage us all.

Mercifully, times of national crisis are not that common. In 1973 Ted Heath announced that the nation was facing its gravest crisis since the Second World War. Now it seems that we are all in it together once again: the Blitz, Dunkirk and all that.

The feeling is perhaps more powerful because there is a generation of people who have grown up in Britain knowing only a prolonged economic upswing; Labour's 1997 anthem D: Ream's "Things Can Only Get Better" spoke, perhaps unintentionally, for the aspirations of a generation, who expected that the natural progression of things was that they would become ever richer.

I am not one of those people who is rubbing my hands in glee at the news of more rich financiers who have lost more money in a minute, than I will ever see in my entire life. I do not want to return to a world of black and white televisions; outside lavatories and works outings: I like my HD telly, my swanky shower and my foreign holidays. But then I came across a fascinating new book by Alwyn W Turner called Crisis, What Crisis? Britain in the 1970s, an affectionate but unflinching portrait of the era.

The author approvingly quotes the conclusions of the New Economics Foundation, offered in 2004: according to the "measure of domestic progress, incorporating such factors as crime, family stability, pollution and inequality of income... Britain was a happier country in 1976 than it had been in the 30 years since".