Things I Don’t Understand About Economics
I’ve been awake for a few months now, and I keep hearing that “consumer spending accounts for 70% of the American economy.” My first reaction was, “Very good. Everyone has lots of extra money to spend.”
My second reaction was, “Wait. What? Where’s all the extra money coming from, and where’s all the stuff coming from?”
You probably already know the answer to these questions, but they surprised me. The stuff mostly comes from China on boats as big as the Rose Bowl. The money? Well, most of it seems to come from China, too. In the first decade of the 21st century, we went to a Chinese Las Vegas, borrowed against the house, and threw ourselves a party.
Sometime during my nap, a new economic ideology took hold in this country. Based on something called the “Laffer Curve,” it tells us that we can pay fewer taxes, get more services from our government, and buy more stuff with all our extra money. And it won’t cost us a dime. Who wouldn’t like that?
It’s such a beguiling idea, we’ve tried it twice. Once in the 1980s, (when we went to a Japanese Las Vegas) and then again in the early part of this century, when the casino relocated to China. Both times we had the same result. We ended up with tons of extra stuff, massive national and personal debt, and poor people wandering the streets or living in tent camps.
We also have something called “supply side economics.” Near as I can tell, this is based on the principle that every product that is made instantly adds value to the world economy in such a way that it more than makes up for the cost of its production.
Seriously? The manufacture of a pair of “I’m With Stupid!” t-shirts automatically enriches life on this planet? Or do I hear the sound of poor Adam Smith whirling in his grave?
When I fell asleep back in the 60s, we were awash in cheap goods from Japan. You’d buy them if you were broke or needed something in a hurry, but if you wanted quality, you paid a little more for something “Made in the USA.”
Now, America has been transformed into a “service economy.” Which apparently DOESN’T mean we wait on each other’s tables — it only seems that way. We were recently promised that our catastrophic national recession would end if only…. we’d spend more of the money we don’t have, to buy more stuff we don’t need.
Maybe it’s just me, but I already have more stuff than can keep track of or reasonably care for. When I do need to buy something, my focus now is on durability, quality and sustainability in manufacture. The old bromide “you get what you pay for” has a modern corollary, “you pay for what you get.” We may not see the costs, but somebody’s bearing them. Faceless people working in a forgotten corner of Asia or Africa, and the world environment, usually.
Really, that costs us all dearly.
Next week — Ted travels!
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