It will be a dismal Christmas for retailers. Holiday purchases are often made with credit cards. However credit card companies are slashing spending limits even as consumers are maxing out their cards, with such debt soaring at unprecedented rates these past few weeks.
Asymptotic Life asks, do we really need all this stuff? And more to the point, our GDP is based on growth, so that means the more junk we make and throw away, the higher the GDP. But that’s not real growth.
Constructing freeway interchanges that go nowhere is included in GDP. Leaving your lights on all day when they’re not needed, or letting your car idle while you run into the post office, or paying some teenager to make hamburgers that go into the dumpster at the end of the day— all this gets included in GDP. Sadly, conservation actually hurts GDP because it saves money and therefore causes GDP to go down.
Therein lies the problem
Sadly, we live in a society that cannot (in its current form) function without increasing waste. We’re catching a glimpse of this now: If we stop buying goods we don’t really need, the whole structure will come tumbling down.
The American consumer has been the driving wheel of the world economy. But with the home equity of credit no longer available as an ATM and credit card debt soaring, the consumer is tapped out. China is hurting as a result, with thousands of factories already closed and thousands more coming. We’re in a global recession now. Destination unknown.