Will We Need Consumers To Recover, and more?

The New York Times' Room for Debate commentary included economists, a sociologist, and couple of historians discussing the necessity of consumerism for the United States and the global economy. I highly recommend you read "Saving the World, Without U.S. Consumers."

Some highlights:

From historian Lawrence Glickman, "Although it might be measured in the same way economically, a dollar spent on mass transit or public education serves the commonwealth more effectively — and in a more long-range fashion — than does a dollar spent on gas-guzzling automobiles." (Hmm. Really? It sounds good on the surface, but I suppose it depends on what happens in the automobile, bus, and classroom.)

From sociologist Juliet Schor, "Expecting the U.S. consumer to be the locomotive for global or even domestic economic growth is foolhardy for two reasons. First, as is now well understood, much of the robust consumer growth of the past two decades was underpinned, not by income growth, but by the expansion of debt and unsustainable growth in family labor hours." (You'll have to read the rest of her short piece to learn the second reason. I think Juliet Schor makes a whole lot of sense.)

From economist Bernard Baumohl, "Indeed, the amount Americans consumers spend in one year is greater than the entire G.D.P. of China, India, Canada and Russia — combined!" And also, "The problem isn’t that we have a hunger for laptops, flat-screen TVs, cars and appliances. It’s how we paid for them. Only 65 percent of our shopping bill was paid for out of wages and salaries." (I am going to have to get to know Bernard Baumohl.)

Bottom line? The alleged wealth created for most Americans does not exist. It's funny money. A leased BMW is worth $60,000 on the showroom floor, but it's worth negative-fifty-thousand-something-dollars on the suburban driveway.

There are few signs that policy makers or business interests are changing their ways. And there is very little evidence that those people (the policy makers and business people) feel the pain of the economic mess that's been created. Perhaps more commentary soon...

Comments

[Somebody]

"There are few signs that policy makers or business interests are changing their ways."

Are there any more signs that debt-fueled consumers (en masse) are changing their ways, but for a spell? Would make for an interesting topic, I think.

You probably want to say yes, but can't really be too confident about it. Or? (Eagerly awaiting "perhaps more commentary soon". ;-)

"Hmm, I suppose it depends on what happens in the automobile, bus..."

I'll leave the question of (the effectivity of) education for another time, but purely on a technical level of effectiveness, a liter of fuel spent by mass transit transports more people than a liter of fuel spent by a gas-guzzling automobile.

[Somebody]

Come to think of it, I'm repeating myself on the topic of consumers. Sorry about that.

[Brandon Smith]

I ought to share one of my favorite links about cars and economics, since you mentioned leased BMWs:

www.daveramsey.com/etc/lms/drive_free/player.cfm

As far as fuel goes, 100-mpg cars may actually be more energy-efficient than mass transit. This analysis deals in BTUs: http://www.businessinsider.com/the-true-cost-of-a-high-speed-rail-for-the-us-is-more-than-500-billion-2009-5

However, purchasing 100-mpg cars like Aptera are out of the reach of most people, and worse yet, they continue the trend of consumerism, whose true cost to society and the environment is much, much higher. It just goes to show that while energy efficiency is important, it's not all we should be thinking about.

[Raleigh Auto Repair]

Can i use this blog as reference in my college report

Regards

[external signage]

You seem to have got the niche from the root, Awesome work

Regards