Tuesday, September 1, 2015

Don't Use "Materialism" As An Excuse to Cut Growth!!

Justin Fox, in "Maybe This Global Slowdown is Different", debates whether the world will see a return to the earlier economic conditions which existed all too recently. And then he added something which made me cringe, because it was an argument I did not expect to hear from someone so well respected:
Still, I can't help but thinking (perhaps wishfully thinking) that what we're seeing might also be the beginnings of a plateauing in the world's demand for things -- and, even more, the resources needed to make those things.
Maybe I need to find a blackboard - do they still have those in schoolrooms anymore? - and write on it one hundred times...we're not ready, we're not ready, we're not ready! Anti materialist attitudes are one of my primary concerns. Even though much of the services marketplace continues to rely on the wealth of traditional production, this incredible dilemma has yet to be addressed. Check the growth in services as compared to the decline in goods between 1950 and 2014, in the above link. Does anyone think that more services will continue to be funded by high income consumer spending on goods, so that lower income levels can still access services?

It's one thing for someone who is financially secure to disavow materialism, sell everything they own in one giant yard sale and travel the world. I know I would if I could. It's altogether another for those who have not even gained economic entry - who have yet to even benefit from the economic stability which materialism provided for so many in the twentieth century. People in Washington knew this moment was coming, for decades. Grrr...

Why did Washington not address the need to generate a services marketplace which is not completely dependent on the wealth creation, i.e. materialism of "things"? The fact they did not, has reduced public confidence in politics, macroeconomics, and also the Fed, as (practically) everyone mistakenly encourages them to pull back the throttle till doomsday.

The fact that a continuing strategy for long term growth was never addressed, has certainly made my "autumn years" a lot more complicated. Life would be far more zen if I were tending a beautiful cottage garden, instead of questioning my (remaining) mental capacity at a computer keyboard. Plus, the Fed has turned its back on hard won monetary knowledge from the years of the Great Depression, because no one cared enough to nurture long term growth potential before economic output was lost.

Time value has the potential to become a useful and inspiring economic good - one which could greatly assist these times of historical transition. A marketplace for time value, would make the transition away from materialism - if indeed that is what the elite now deem "appropriate" - less of a bumpy ride than it now appears. I'm still not happy about this rationale at all, because it seems too self serving. But what do I know?

At the very least, policy makers could recognize that people need to be economically connected, in order to remain fully functional. Without a marketplace for time value, less materialism still means fewer jobs, overall. Even those who may not choose to go shopping for "stuff", still seek the experiential and pragmatic products of time based knowledge if they have the means to do so. Will anyone in the decades ahead make it possible to generate these for all income levels? All I can do is hope for the best.

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