I was reading the paper today, and they were talking about the problems when credit got tight. The example they gave was that stores borrow in the summer to buy inventory to sell at Christmas. And consumers get credit to do their Christmas shopping.
I don’t readily understand why this is a good thing. It seems like a vicious circle - a potential house of cards. I know I hold a minority position, but I don’t understand why it is considered inherently desireable aim that the largest percentage of people possess the largest amount of consumer goods. And that, I believe, is a significant criticism of “the American way of life.”
And government policy is set to allow individuals access to consumer goods - instead of, say, more narrowly increasing access to necessities such as affordable medical care. It seems when necessities and luxuries are both dealt with in the market, many many folk opt to go with luxuries first, and then beg assistance when they cannot cover their basic needs. Sure, each of these terms - luxury, necessity, etc. - must be defined. But it seems to me that we have reached a point at which we believe a considerale level of luxury IS a necessity. And I, for one, am not convinced this is necessarily “a good thing.”
But I believe ever-increasing consumption is considered necessary if our economy is to continue to grow. And how do you weigh whether the benefits from a growing economy outweigh the damage from increasing debt - either by individuals or a country?
Yes, it would be painful if our economy were to slow down. But is it really desireable to pursue a policy that MORE is always needed?