a good article describing why an economic downturn will hurt more then it should

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I liked this column in my local paper. I think it is a dead on commentary on our present society......

Big-spending consumers have the good life now, but ...
August 05, 1999

Are you too good for soap scum?

Sales of body wash, the liquid stuff you buy at Bed, Bath & Beyond, are soaring. This comes even though body wash costs three to four times the price of a bar of soap, and the principle advantage over soap is that there's no cleanup mess in the shower.

The trend to body wash is only a small part of the upscaling of America. Products that were once luxuries for the rich are now considered necessities. Americans are now living large in ways that would have made John D. Rockefeller envious.

People don't use pay phones anymore; they use cell phones, and pay for calls that come in as well as go out.

In the 1950s, everybody bought a TV, and in the 1960s, they upgraded to color. In the 1980s, everybody bought a VCR, and then two or three VCRs. Today, half of all TVs sold are 30 inches and up, bigger than will fit in a car trunk. And 20 percent of all families have home theater, according to the Consumer Electronics Manufacturers Association. This usually means a giant-screen TV with an outside amplifier and speakers, a DVD and VCR, and a satellite dish, too, complete with monthly payments.

Two-bedroom, one-bath homes are a glut on the market. People want bigger houses though they have smaller families. The size of the average American home rose a stunning 60 percent from the early 1960s, to almost 2,200 square feet last year. Half of all homes sold last year had at least 2.5 bathrooms, and eight of the 10 had room for at least two cars (that's cars that cost an average of $23,488, according to the National Auto Dealers Association).

Speaking of cars, can anybody explain to me why anybody needs an SUV in flat South Florida, other than to intimidate other drivers on I-95? Oh, I forgot, people who move out to Plantation Acres to get away from it all need them after it rains 10 inches and they discover they are more at one with the Everglades than they would like to be.

Consumers outfit their kitchens with granite countertops and professional-quality cookware, though they rarely use anything other than a microwave and the coffee maker. Eating out is no longer a luxury -- college-educated adults spent 47 percent of their food budget on outside food last year -- and many double-income parents practically raise their children on takeaway food.

In many ways, we're rich beyond our wildest dreams. Some people are in fact quite wealthy, thanks to a seven-year boom in the stock market. The number of millionaires rose 36 percent, to 4.1 million, between 1995 and 1998.

But most people are maintaining their lifestyles with credit cards. Annual spending rose 5.6 percent between 1991 and 1998, while income rose only 4.8 percent. Savings plummeted from $243 billion to a negative $36 billion during the same period. The American consumer is keeping the economy afloat with deficit spending.

These big spenders shouldn't count on bankruptcy as a last resort. At the urging of the credit card and banking industries, Congress recently passed legislation that would make it harder to shed debts in a bankruptcy filing.

But Congress can't repeal basic laws of economics, such as the one that says boom times are inevitably followed by recession. Of course, maybe we're in the middle of the Long Boom, the 25-year era of prosperity predicted by Wired Magazine.

But maybe not. And there are consequences to the spending. A Cornell University professor points out in his book, Luxury Fever, that this lust for luxury hurts middle-income Americans who are roped into luxuries they may not need. Bigger, more expensive housing means parents might not be able to afford to live in a neighborhood with the schools they want for their children. Many people are finding the cost of buying a car a burden.

Many people know only the good times. Forget the Great Depression; most people don't even remember the last recession. (Dan Quayle was vice president, Johnny Carson was still on the Tonight Show, and Mark McGwire batted .201. It was 1991)

The economy is as good as it has been in 30 years, and it keeps surprising the experts with its strength. But if it finally does start to slow down, a lot of people might find themselves in trouble.

Editor's note: Business writer David Altaner is on special assignment. His column will resume in late fall.

-- Bob (bob@bob.bob), August 05, 1999


Getting back to more basic living, fewer luxuries, more savings, less debt, more family orientation, less external distraction (including TV, also known as mass mind control) fewer choices at the supermarket, walmart and the car lot will be a great benefit to our society, both environmentally and economically.

I knew we had gone over the edge when I saw bubble gum being marketed in a bandaid tin. This sh*t has got to stop. Will we miss it? Hell, we didn't even ask for it. Some geniouses sitting around a boardroom table figuring out how to carve out more of a market share for their company have thrust this crap on our society.

It's time to tell them go GO EARN A REAL LIVING, for god's sake!!!!!

-- OR (orwelliator@biosys.net), August 05, 1999.

Font off

-- Brian McLaughlin (brianm@ims.com), August 05, 1999.

-- Brian McLaughlin (brianm@ims.com), August 05, 1999.

"We're the first nation to drive to the poor house in an automobile." Will Rogers, circa 1931

-- Brian McLaughlin (brianm@ims.com), August 05, 1999.

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