Spending and faith

d-ray657 · #1 08-08-2010, 02:30 PM

The word faith has a significant meaning in economics, with respect to the faith of consumers and investors in the economy.

A more religious meaning of faith has been working lately on my thoughts about consumerism.

Awhile back, there was a push to include the ten commandments in public buildings and park. There were those who said that the Ten Commandments provide fundamental law. Some of the Ten Commandments could not be enforced under our system of laws, for example, "Thou shalt have not other gods before Me." Serious First Amendment problems trying to enforce that one.

The one of the Ten Commandments relevant to this post is "Thou shalt not covet." The problem with trying to enforce that one is that our economy is based on covetous. We are constantly given the message that we should want what other people have. It's cool to have an ipod, so when we see someone with one, we want one. Same with the ipad; flat screen TVs, new cars. Our boys attended a pretty wealthy school district, and there was a lot of pressure to maintain a particular fashion sense, to engage in particular forms of entertainment, to take spring break trips, to have a car, etc. They would visit friends with very nice homes. The norm is high consumption.

I've finally started attending church again. The past two weeks the scriptures, hence the sermons, focused on the gospel view of materialism. Last week was about the parable of the rich man who needed to build more barns because he was accumulating so much grain and other goods. This week is was about worrying about material things. The sermons reminded me of a subject I have spent a lot of thought on. If we actually consumed only according to our needs, our economy would crash.

It's been mentioned here many times about how the example set by Washington - that we can have it all without paying for it - has influenced our consumer spending as well. Consumer debt is at record levels. Because of the disposable nature of our economy, some of us are probably paying toward a debt that was incurred for things we no longer have. As my wife has mentioned several times in our life, it is easy to become prisoners of our lifestyle, particularly when some of our lifestyle is borrowed.

I have also read many places how our kids might be the first generation for a long time to be more likely to have less than their parents. In my mind, that is not a bad thing. If they are freed from the worry of maintaining a particular lifestyle, they might be able to live happier, more contented lives. They would be more mobile, able to change locations or occupations without the financial risk of having too many things to move, too many debts to pay.

Personally, I would encourage my kids to scale back expectations as far as consumption goes. Both will be equipped with a college degree, which will put them ahead of the game in many respects, but I would rather see them live their lives with fewer worries than we have had.

Sorry about the stream of consciousness here, but this has been on my mind quite a bit lately. It seems like the sermons I have heard lately have been what I needed to hear. We do need to simplify our life.

I'll close with a question or three. If more and more people actually scaled down their consumption to needs rather than wants, what would be the effect on our economy?

Would our economy be stronger in the long run with a lower private debt?

Would the financial institutions that have profited immensely from our dysfunctional consumerism see their just deserts if we as a nation were able to reduce our debt?

Could we survive the discomfort that would accompany a different focus on our standard of living?

Thanks for letting me think out loud.

Regards,

D-Ray

merrylander · #2 08-08-2010, 02:59 PM

Let's see, we don't have most of the gadgets you listed and we really are not interested in living up to the Jones'. That said the economy got around $8000 for a new roof, about $7000 for two steel patio doors, $500 for sidewalk repairs and $2000 for the deck, so even without blatant consumerism our local economy did all right. I am sure there are many others spending on their own wee money pits.

finnbow · #3 08-08-2010, 03:16 PM

When you think about it, most of the cool gadgets (iPods, iPads, netbooks, HDTV's, smartphones, etc.) are all built overseas nowadays anyway. If we could reign in consumerism, I believe we'd be better off in the long run. Sam Walton and Gordon Gecko may disagree, however.

Boreas · #4 08-08-2010, 03:30 PM

Quote:

Originally Posted by d-ray657

I'll close with a question or three. If more and more people actually scaled down their consumption to needs rather than wants, what would be the effect on our economy?

Would our economy be stronger in the long run with a lower private debt?

Would the financial institutions that have profited immensely from our dysfunctional consumerism see their just deserts if we as a nation were able to reduce our debt?

Could we survive the discomfort that would accompany a different focus on our standard of living?

Thanks for letting me think out loud.

Regards,

D-Ray

Don, I think your analysis is spot on. As to your questions, I just don't know. I think we as a society would benefit from pulling in our horns but I suspect that our economy has grown up on a culture of over-consumption and couldn't withstand a rapid retrenchment. Perhaps on a gradual basis.

Given my hobby of collecting old gear, I'm a frequent habitue of Goodwill and Salvation Army stores as well as county landfills. It astonishes me to see what gets thrown away, buried and forgotten in landfills. I've recently started going to our Goodwill Outlet Center which is an "as-is" store at the regional GW HQ. There I've seen the prodigious amount of stuff that they throw away without ever offering it for sale or, at best, putting it out on rolling tables for 20 minutes before rolling out the next table. Anything not taken gets dumped.

John

BlueStreak · #5 08-08-2010, 03:39 PM

Hmmmm............? I've always considered myself to be a typical American consumer. When it comes time to buy, say, a car for instance. Do I buy what I need, or what I want, what I can just barely afford? What I really needed was something small and efficient as I have a 38 mile commute every day. But, no, I bought what I wanted and could just barely afford. Which I have learned was the foolish move becuase for a few months a while back, I had my hours cut to less than 40 per week, and suddenly found myself struggling to keep everything paid up. If I had gone with a smaller more efficient vehicle, the worry would not have been so bad. As I grow older the wisdom of saving money for the future, rather than spend it all on goodies to satisfy todays desires becomes more and more important to me.

As such behaviour relates to faith I turn to the Seven Deadly Sins. Particularly "Greed" and "Gluttony", which to my mind relate the best to materialism and the nearly psychotic drive to pursue "more" that so many in our society seem to have. If you think about it, it truly is insane. As the line from "Wall Street" goes, "How many yachts can you ski behind?" There really isn't any logical sense to it other than to say it's just human nature to want "more". Once you have all you need why do you continue to beat yourself and others to death to obtain things that you do not need?

Greed is Good?

I understand that in a capitalist society a business must make money to grow. And we need business to grow in order to create more jobs, enabling more people to work and support themselves. And I am fine with this. Up to this point, I think it's a wonderful thing. Wouldn't want it any other way. But, once the driving force of the business becomes solely to make money for only one, or a small handfull of people, and no longer creates jobs, or pays taxes into the society it exists in, then what good is it? At this point the greed of the few has ceased to serve the greater good, and thus becomes a burden. It only takes and never gives.

What worries me now is that so many of my friends and family have saved NOTHING for retirement, have no pensions and will have no way to support themselves in old age. Like it or not, you will grow too old to work one day...God willing. Many of these same people want to eliminate SS and Medicaid/Medicare, and oppose healthcare reform. Why?
Ostensibly, so they can get a tax cut and spend the money, now, on shit they don't really need......Greed and Materialism at it's worst.

I believe they do so at their own peril. But that's just me. And I'm a liberal dumbass.

Dave

finnbow · #6 08-08-2010, 03:59 PM

Isn't consumerism supposed to fund our War on Terrorism? Keep shopping, patriots!

d-ray657 · #7 08-08-2010, 04:42 PM

Finn brought up an important point. Because most of the STUFF we buy is imported, not only is our consumerism increasing debt, it is transferring our wealth to other countries. In that way, lesser consumption on our part would improve our economy. Potentially, if greater savings could lead to investment in technologies and products that we could export, the positive effect of lessened consumption could be multiplied. (Doubtful, but I've already admitted I'm and incurable optimist.) I wonder if any economist would NOT say I'm crazy?

BTW, George Carlin is brilliant in his discussion of stuff.

Regards,

D-Ray

Charles · #8 08-08-2010, 07:31 PM

Debt and consumer spending is what makes the world go 'round.

Personally, I think everyone should get in debt up to their eyeballs and spend it all...other than myself.

On the side, just a couple of years ago the smart money folks were telling people to invest their extra funds instead of paying their mortgage. The conventional wisdom was you would make a couple of points more on your investments that what it costs to service the debt on your house, with the added bonus of paying your mortgage off with inflated dollars.

Thank God I'm a stupid, tightfisted hillbilly who operates on the dumb money principle.

Chas

merrylander · #9 08-09-2010, 06:43 AM

Having grow up during the Great Depression (still can't figure out what was so great about it) we had no blatant consumerism, but businesses survived during the thirties. During the war there were no products for sale, everything went to the war effort. We made things last, can't tell you how many radios I kept running after my brothers went into the services. Once the war was over sure there was a pent up demand but that made the small businesses prosper, there were no big box stores full of off shore crap. We could go back to that and tell wally world and home despot to get stuffed.

piece-itpete · #10 08-09-2010, 10:14 AM

Great pst!

I fully agree that we should reduce our debt, though 'do as I say'....

We are also incredibly wasteful.

I think the biggest church around is the US dollar. It takes amazing faith to believe in it considering the supply and our debt!

I also believe the government followed the people, not the other way around.

Pete