World’s Designated Shoppers Drop

How much lower can consumer spending go? The malls are like mausoleums, retail clerks are getting laid off, and AOL recently featured on its welcome page the story of man so cheap that he recycles his dental floss – hanging it from a nail in his garage until it dries out.

It could go a lot lower of course. This guy could start saving the little morsels he flosses out and boil them up to augment the children’s breakfast gruel. Already, as the recession or whatever it is closes in, people have stopped buying homes and cars and cut way back on restaurant meals. They don’t have the money; they don’t have the credit; and increasingly they’re finding that no one wants their money anyway. NPR reported on February 28 that more and more Manhattan stores are accepting Euros and at least one has gone Euros-only.

The Sharper Image has declared bankruptcy and is closing 96 U.S. stores. (To think I missed my chance to buy those headphones that treat you to forest sounds while massaging your temples!) Victoria’s Secret is so desperate that it’s adding fabric to its undergarments. Starbucks had no sooner taken time off to teach its baristas how to make coffee than it started laying them off.

While Americans search for interview outfits in consignment stores and switch from Whole Foods to Wal-Mart for sustenance, the world watches tremulously. The Australian Courier-Mail, for example, warns of an economic “pandemic” if Americans cut back any further, since we are responsible for $9 trillion a year in spending, compared to a puny $1 trillion for the one billion-strong Chinese. Yes, we have been the world’s designated shoppers, and, if we fall down on the job, we take the global economy with us.

“Shop till you drop,” was our motto, by which we didn’t mean to say we were more compassion-worthy than a woman fainting at her work station in some Honduran sweatshop. It was just our proper role in the scheme of things. Some people make stuff; other people have to buy it. And when we gave up making stuff, starting in the 1980s, we were left with the unique role of buying. Remember Bush telling us, shortly after 9/11, to get out there and shop? It may have seemed ludicrous at the time, but what he meant was get back to work.

We took pride in our role in the global economy. No doubt it takes some skill to make things, but what about all the craft that goes into buying them – finding a convenient parking space at the mall, navigating our way through department stores laid out for maximum consumer confusion, determining which of our credit cards still has a smidgeon of credit in it? Not everyone could do this, especially not people whose only experience was stitching, assembling, wiring, and packaging the stuff that we bought.

But if we thought we were special, they thought we were marks. They could make anything, and we would dutifully buy it. I once found, in a party store, a baseball cap with a plastic turd affixed to its top and the words “shit head” on the visor. The label said “made in the Philippines” and the makers must have been convulsed as they made it. If those dumb Yanks will buy this…

There’s talk already of emergency measures, like making Christmas a weekly holiday, although this would require a level of deforestation that could leave Cheney with no quail to hunt.

More likely, there’ll be a move to outsource shopping, just as we’ve already outsourced manufacturing, customer service, X-ray reading, and R & D. But to whom? The Indians are clever enough, but right now they only account for $600 million in consumer spending a year. And could they really be trusted to put a flat screen TV in every child’s room, distinguish Guess jeans from a knock-off, and replace their kitchen counters on an annual basis?

And what happens to us, the world’s erstwhile shoppers? The president recently observed, in one of his more sentient moments, that unemployment is “painful.” But if a pink slip hurts, what about a letter from Citicard announcing that you’ve been laid off as a shopper? Will we fill our vacant hours twisting recycled dental floss onto spools or will we decide that, if we can’t shop, we’re going to have to shoplift?

Because we’ve shopped till we dropped alright, face down on the floor.

Comments

[Larry In Lethbridge]

" So Roger, how's the Kool-Aid? "
Classic, just classic.

I see our bigotted ignorant racist friend Chris is harping on Muslims again. I swear that man's head is gonna blow up one day.

[Chel]

Larry,
How about coming up with some arguments backed up with facts to refute Chris' claims rather than constantly taking cheap shots at him?

Chris is the most intelligent and insightful commenter on this blog by far. I think you're too afraid to go head-to-head with him debating issues, so instead you opt to accuse him of not getting enough sex. Mature, very mature.

[Jacqueline Homan]

Chris posted: "In sum, the Squire said Supply and Demand affects education like any other aspect of life."

This is very true Chris. Now follow me on this:

Is it not true that the demand for education has skyrocketed due to the fact that we went from a manufacturing based economy to a service/information based economy over the last 20 years?

Is is not true that the increase in cost of higher education surpassed general inflation while simultaneously, student aid was cut severely with the passage of the Gramm-Rudman Bill back in the 1990's (leaving the poor and lower middle class out)?

Is it not also true that the "haves" and "have-mores" of this country have been browbeating the poor, telling them if they're poor it's their own fault for failing to get an education?

Yeah, pull yourself up by your bootstraps even though you have no boots...

Student aid all the way up to grad school was cut, student aid amounts were capped, welfare was cut in 1996, federally subsidized jobs programs under CETA (which was merged w/ JTPA in the late 1970's)that served to place the disadvantaged in jobs was cut during the 1980's.

Not only are there not enough jobs to go around for everyone who needs one and who wants to work but there is also the fact that jobs which only required a high schol diploma 30 years ago (receptionist, secretary, etc) now require a Bachelors Degree. Oh, and let's not forget that age discrimination - particularly against women trying to re-enter the workforce after being out of the loop - is a very real huge problem, too.

Funding for grad school is not widely available unless you are in a program at a particular school that has it and secondly, not everybody can be a computer guru or an engineer...what about those who aren't? What's the justification for leaving them out of the economic pie, socially excluding them, and then telling them that if they're poor, it's their own fault?

What happened is more and more of America's disadvantaged tried to get educations. But this in turn led to more systemic barriers being erected that made it much harder for the poor to get those educations and good jobs and those barriers were erected on purpose by the "haves" because they don't want more upward bound poor competing against the children of the entrenched middle and upper classes for life's social prizes and rewards - i.e. a good paying job - in an ever-shrinking pie in our lovely social Darwinist society.

The pie itself has gotten smaller as more and more white collar jobs have been off-shored to the lowest bidder. All of this has served to make the middle classes more insecure (and thus, more selfish)and hence close ranks, so to speak, to ensure that they (and their progeny) don't have to compete with the poor for seats in universities and good jobs in a Serengeti economy. Prove that this is not occurring.

[Chickensh*tEagle]

chris: "Robert Mugabe, A Man Obama's Reverend Wright Can Love!"

All true. But if you're trying to discredit Obama, wouldn't it be more effective to associate him directly with Mugabe instead of through a third party?

Provided there were a direct connection, of course.

[Chickensh*tEagle]

roger: "this of course being a tawdry and crude business would leave open the question of whether socialism as an ideology is healthy for the united states."

A question we could have gone to directly without the Katyn detour.

If by socialism you mean the state owning and controlling everything, the answer is, of course not. If by capitalism you mean the for-profit sector, especially transnational corporations, owning and controlling everything, that's not healthy either.

"if the employer is identified as an imperialist pig what options would the machinist still have. is is appropriate to designate those who have the audacity to work for a living as war profiteers and contributors to imperialism.

Picking the highest-paid, most accessible job isn't "audacity." Audacity, if one wanted to quit enabling militarism, would be to work at something else, even if it were less convenient and paid less.

[Larry in Lethbridge]

Chel is thinking and wondering :" Chris is the most intelligent and insightful commenter on this blog by far. I think you're too afraid to go head-to-head with him debating issues,..."

Debating anything with Chris is like talking to a brick wall. Why? Well for one thing ,Chris is like a little kid who needs to get his own way . He needs to be the center of attention. He is rude, arrogant,insolent, and above all, a racist bigot.

Chris displays some serious disturbing personality flaws at this blog as is witnessed by the people who read his stuff. Trying to engage in any type of civilised discussion with him , is futile.

As for me accusing him of lack of sex, hey ask any psychiatrist about men who ramble on like him. Who expose themselves like he does on this blog. They will either say 1) Napoleonic complex 2) Small weenie issues 3) Woman find him repulsive, no nooky issues.

If this fool can come on and attempt to take down Islam because he is ignorant and racist
, why can't I share my thoughts on what I feel is wrong with Chris?

I think this assessment of Chris is not only mature but highly accurate.

[chris]

Jacqueline Homan, you asked:

"Is it not true that the demand for education has skyrocketed due to the fact that we went from a manufacturing based economy to a service/information based economy over the last 20 years?"

Deceptive Question! The value of some knowledge has increased, and the value of other knowledge has decreased. To which knowledge pools are you referring?

English degrees are out. Engineering degrees are in.

Education degrees get public-school jobs for people. But degrees in math and science and other technical subjects are what's needed.

You pondered:

"Is is not true that the increase in cost of higher education surpassed general inflation..."

Yes. Full RETAIL tuition has moved up faster than inflation. Who pays RETAIL?

And:

"...while simultaneously, student aid was cut severely with the passage of the Gramm-Rudman Bill back in the 1990's (leaving the poor and lower middle class out)?"

My niece was offered a near full free ride at Tulane (Sophie Newcomb) in New Orleans. Much to her parents distress, she turned down the heavily discounted offer to attend Tufts, a school that offered her ZERO. Her parents are paying retail. Meanwhile, some other kid is getting the nearly free pass at Tulane.

You fabricated:

"Is it not also true that the "haves" and "have-mores" of this country have been browbeating the poor, telling them if they're poor it's their own fault for failing to get an education?"

No. Not true at all. In fact, I am surrounded by tuition payment programs funded by the haves and have-mores. Bill Gates is one benefactor among a large number.

You opined:

"Yeah, pull yourself up by your bootstraps even though you have no boots..."

It's not all that tough. If you're entering a field that requires specific knowledge, it's rather easy to learn much of it for very little money. The first two years of most engineering programs comprise physics, chemistry, calculus and some introductory courses. Start at a local Technical college. Transfer later.

You showed a general lack of inventiveness saying:

"Student aid all the way up to grad school was cut..."

Grad school is practically free for engineering and science students. Meanwhile, many many schools offer special programs for black science and engineering students. There are scholarships and abundant assistance. But, there are virtually no black science, math and engineering students.

And:

"...student aid amounts were capped..."

Almost all schools offer tuition breaks to good students.

You wrote:

"...welfare was cut in 1996, federally subsidized jobs programs under CETA (which was merged w/ JTPA in the late 1970's)that served to place the disadvantaged in jobs was cut during the 1980's."

You're breaking my heart. I paid my own way through engineering college. My school offered a co-op program -- alternating semesters of work with semesters of school. These programs are fantastic.

You imagined:

"Not only are there not enough jobs to go around for everyone who needs one and who wants to work but there is also the fact that jobs which only required a high schol diploma 30 years ago (receptionist, secretary, etc) now require a Bachelors Degree."

False. However, often enough, a secretarial position is an "entry-level job". In other words, a job given to a promotable person, not a person expecting to answer phones and perform word-processing for years and years.

Then, the big bugaboo:

"Oh, and let's not forget that age discrimination - particularly against women trying to re-enter the workforce after being out of the loop - is a very real huge problem, too."

Age discrimination is an issue. When Congress wises up and expands the H-1B visa program, things may improve. When Congress permits US energy companies to exploit ALL domestic reserves, things will improve.

Then this bit of misinformation:

"Funding for grad school is not widely available unless you are in a program at a particular school..."

Putting that in more accurate terms -- funding for grad school is available to those pursuing many courses of study.

And:

"...not everybody can be a computer guru or an engineer...what about those who aren't?"

What about them? I admit most people are incapable of becoming engineers. It's more true that even fewer people are capable of earning a living in the arts. Writing programs are springing up at colleges everywhere. There's no question most people should improve their writing. But almost no one in the US earns a living simply from skillfully writing his personal thoughts for others to read.

Nevertheless, there seems to be a trend among colleges to imitate the Iowa Writers School. But graduates will have a tough time earning back their tuition expenditures through their creative writing exercises.

And this whopper:

"What's the justification for leaving them out of the economic pie, socially excluding them, and then telling them that if they're poor, it's their own fault?"

What's the justification for giving money to people with job skills no employer wants?

More whoppering:

"What happened is more and more of America's disadvantaged tried to get educations."

Not true. Many people have pursued interests that have no economic value. A degree in black history is almost meaningless. On the other hand, very few people pursue technical studies even though technical jobs exist and will continue to exist.

And more whoppering:

"But this in turn led to more systemic barriers being erected that made it much harder for the poor to get those educations and good jobs and those barriers were erected on purpose by the "haves" because they don't want more upward bound poor competing against the children of the entrenched middle and upper classes for life's social prizes and rewards - i.e. a good paying job - in an ever-shrinking pie in our lovely social Darwinist society."

Total nonsense. Total nonsense. Clearly you have succumbed to some cult thinking. What other conspiracy theories are nipping at your mind?

And it keeps on coming:

"The pie itself has gotten smaller as more and more white collar jobs have been off-shored to the lowest bidder."

Jobs are always priced at the meeting point between employer and employee.

And more:

"All of this has served to make the middle classes more insecure (and thus, more selfish)and hence close ranks, so to speak, to ensure that they (and their progeny) don't have to compete with the poor for seats in universities and good jobs in a Serengeti economy."

College enrollment is way up. Applications to all schools are up. Competition has gotten so tough at the nation's top schools that if grades and SAT scores were the basis for admission, asians would take a huge percentage of the seats. But that's not how schools are playing it. Asians are the new Jews. They face quotas at many schools to keep seats open for lesser students of other races.

Stuyvesant High School is the best PUBLIC high school in NY City. Students must pass a tough test to get in. That's it. One test. Money doesn't matter. Guess what? About 50% of the students are asian. Somewhat more than 40% are white, and less than 10% are of other races.

The poor showing of blacks and hispanics has no connection to money or priviledge. It has everything to do with personal determination.

Your challenge:

"Prove that this is not occurring."

Our economic difficulties are not what you imagine. Congress can settle most problems by getting out of the way.

[lc2]

I guess it's clear by now that no one else is going to reveal their incomes. I was really hoping that Barbara would step up to the plate and tell us hers. One of the great things about a union shop, is no secrets when it comes to wages.

Only proves that the shame that binds us is ever-strong ...

[Brian]

Jacqueline and Chris, if you get the chance read "Generation Debt" written by a member of that generation. It makes our adult credit card debt look like a box of cracker jacks compared what is happening to students today in colleges all across the land. Its absolutely a crime what schools have done to their students and their families. Its shocking. Its so American.

[TV]

OMG, American consumer spending accounts for $9 trillion a year! That's so much money that if it slows down the world is doomed!

The fact that people will read this article and think that Ehrenreich has any clue what she's talking about it sad. Global GDP is over $72 trillion. It's almost literally impossible for American consumer spending to vanish, so it's not like the world would lose $9 trillion a year. An absolutely horrible recession could lower annual consumer spending at most about $2 trillion (and that's stretching the limits of plausibility). So even if we have a horrible Japan-style recession, American consumer spending as a percentage of global GDP would decline only very slightly.

Sociologists should not try to act like economists. It's misleading to readers who foolishly trust that you know what you're talking about, and you look like an idiot. Please Barbara, stop the constant flow of Hackonomics articles. It poisons the well of, you know, actual debate.

[Brian]

Barbara made a good point as a journalist of social phenommena as I hadn't heard that 9 trillion dollar figure before. The net/tech boom-implosion ran about 2.5 trillion dollars out of the economy and we all know what that felt like, so 9 trillion is substantial. I dunno Bernacke and Greenspan presided over the largest financial bubble in the history of the world and they are economists. Even arm chair economists know what happens as you concentrate the wealth of nation's into fewer and fewer unregulated hands who then conspire to use "untold" leverage to fund a meshwork of longs and shorts and on a "net" of de novou financial instruments, swaps, risk-hedges turned upside down and leveraged as well, etc etc, can only come to a bad end. And it has, right under the president with a Harvard MBA's watch. Economist's are practitioners of the dismal science but not scientists. They shouldn't even be given PhD's but rather an applied Doctoral degree in some arcane facet of the "practice" of the economical dialectic. Outside of the fundamentals of fear and greed, both social phenoms, there are no other principles involved in economics no matter how you set up the problem and no matter how many degrees of freedom. Greed just goes till fear overtakes it. In fact its biologic in origins. In my experience even research economists can't describe a "demand function" its so fraught with sociological parameters.

[Maria]

It's true that there are many factors currently influencing a drop in consumer spending. If Washington wants to stimulate spending, instead of giving us a whopping $600 check, why doesn't someone mandate that gas prices need to be dropped? I work with many people of different pay levels within the company and all have the same concerns. Gas prices have risen. Now the price of just about EVERYTHING has gone up due to "fuel surcharges" and we can't afford to splurge on extras because we're not sure how much our next tank of gas or gallon of milk is going to cost us. Horse owners have had to sell or give away their horses due to hay prices doubling. Friends on tight family budgets have to watch how much milk their kids drink or where they drive their kids in order to have enough gas to get to work so they don't have to buy more. While other issues will need to be addressed, lowering the gas prices is a great way to start putting spending money back into peoples' pockets. ENOUGH ALREADY!

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[wastelandamerica.com]

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Frankly Barbara, I'm disgusted by this post. I was told to visit this blog to pander to you so it would help my own, but now I don't think I Want it. SURe, we may both be on the same sides when it comes to America's black hole of a maw for lazy self indulgence,but your violent sarcasm isn't going to win anyone over who wasn't on your side. It repulses me, and I agree with you.

[felabeorht]

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