The lack of spending then further contributes to falling prices, job cuts, businesses closing, etc. It's really not a situation any economy _wants_.
That said, I empathize with your sentiment.
Consider the computer industry. Prices have been falling pretty much across my entire life. Supply-demand suggests that people will keep buying new computers as the price drops and that is exactly what is happening. Demand for compute has never been higher. There is no waiting for improvements, if anything there is a mad rush to buy hardware that everyone knows is about to be obsoleted. It isn't even an irrational rush, the people buying that obsolete hardware often make good money (eg, bitcoin miners in the heyday).
Basic supply demand says as price drops demand increases. Basic life experience says as prices drop I can afford more and better stuff. Observation of real industries suggests - as we would intuit - that industries with regular price drops are actually healthy and great to be in for consumers in the small and the large. Theory suggests that everyone ignores nominal price fluctuations and focuses on real changes so systemic deflation is irrelevant. None of this supports the idea that deflation is bad.
Pretty sure the anti-deflation crowd are just wrong. They have no evidence or argument [0] as far as I can tell, and all the theory is stacked against them. China surely has problems. Deflation is not a problem. It is just a metric.
[0] EDIT Well I suppose they do have an argument, but it involves people randomly going crazy and choosing to live in poverty and discomfort because it gets easier to buy goods. Which is not an argument I really take seriously.
It is rather unlikely that giving people an option that they already have is going to cause a problem. One major benefit of money is that people can hoard it and there is no cost in the real economy because all the resources are still there and prices can just adjust to the amount of cash in circulation.
> here was a small deflationary bump in American history around the 1930s that helps to illustrate what can happen in a deflationary spiral.
The US came out of the 1930s with an economy that was capable of overcoming almost literally the entire world. Again, the evidence that deflation was some sort of major problem is questionable, it seems to have been associated with the creation of one of the most dynamic economies in the history of history.
And the idea that we have this one clear lesson from one instance back in the 30s is just weird and unbelievable. That isn't how history or complex systems work.
Food, energy, transportation, education, etc.
How long are you going to delay getting a new car simply because cars are getting cheaper and better? Once you probe the theory beyond the surface, it collapses. Yes, a deflationary economy will see less cash velocity than a ZIRP economy with cheap cash sloshing around. But, at the end of the day, humans MUST spend resources today to live to see their savings worth more.
One man's debt is another mans income.
The reason we narrowly avoided full blown deflation in 2008 is because they bailed out the banks. If they didn't we would have had 1929 style depression these last 15 years.