Is Consumerism Dead?
(Jonieofarc photo: Wal-Mart on Black Friday)
Last week, President Obama warned Asian nations that (in the words of the Wall Street Journal), "the global economy can no longer count on the U.S. consumer to keep it afloat."
Does that mean consumerism is dead? Will the federal government eliminate all those subsidies that make it cheaper to buy something made in China than to buy the same item made by your neighbor? Not likely. From fuel subsidies to taxes to "free trade," the structures favoring globalism appear to be alive and well.
However, there does seem to be a new awareness that it's not good for U.S. debt to finance a global economic boom. The economic downturn has made many consumers wary of debt— credit card balances have fallen a record 10% over the past year. If our leaders now realize that it's not good for Americans to live as debt slaves, perhaps that message will continue to spread.
People must be taught to save part of their earnings to help them in their rainy days.
People must not be encouraged to spend on items that are not needed now.
Avoid taking loans as far as possible.
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People need to be taught to save, but don't expect government to fill that need. GDP goes up when people spend more. So do tax revenues. So Government has a vested interest in encouraging debt.
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