Our Love Affair With Shopping Malls Is on the Rocks
nytimes.com
nytimes.com
"Here, ladies and gentlemen, is the crux of the problem: We are reliably informed that whatever part of the economic crisis can’t be pinned on Wall Street — or on mortgage-related financial insanity — can be pinned on consumers who overspent. But personal consumption amounts to some 70 percent of the American economy. So if we don’t spend, we don’t recover. Fiscal health isn’t possible until money is again sloshing into cash registers, including those at this mall and every other retailer."
I think the statement that money must be sloshing into cash registers again is a misnomer. Why must we spend money on items we don't really need? Is it our fault that the products are "nice to haves", but not so nice that we're willing to spend on them? I believe that the products and services offered will have to stepped up a notch; become items that improve people's lives and increase happiness.
I see these times as Darwin's law applied to products, services, and businesses in general. If it's not profitable it should fail.
That said the current mess of the economy is at such a scale that it's hard for me to even keep straight in my head. As Henry Ford said, "It is well enough that people of the nation do not understand our banking and monetary system, for if they did, I believe there would be a revolution before tomorrow morning. "
The scary thing is that for most people, their lack of understanding the bigger picture means that when things get really bad, it will happen fast. I'm shocked by how many people simply don't even somewhat understand the way the US financial system works (I can't even say I fully understand it), and by how many of them treat bills and debt as their absolute, life-long moral responsibility. To the bankers, it's all a big game. To the average consumer, it's their entire life.
The most important thing I see missing from all this is education. Financial education should be required by every public school (and should be taught by the parents) to help prepare people for the "real world" of managing debt, credit cards, loans, and even mortgages and investments.
If everybody understood that filing for bankruptcy (I did after losing 3 investment properties to sub-prime) or downsizing and living a more simple life was perfectly OK to keep your family fed (I went from $2.5k /mo expenses to $800), then we wouldn't have people killing their families and committing suicide because of a few financial issues.
In my opinion, people who take on debt do have a moral responsibility to pay it back. If you don't want that responsibility, don't take on the debt.
I understand that bankruptcy is necessary for some–but I would hope people arrive there as a last resort. Teaching people that bankruptcy is a "card up your sleeve" is sending the wrong message.
1. Individuals, the final end consumer of debt, treat debt as a lifelong obligation. A serious, serious obligation. So much that they chastise each other for bankruptcy on Internet forums. (oh no! someone on the internet is fiscally irresponsible!) And act as if not fulfilling monetary obligations to big, anonymous corporations is tantamount to proving that one is a worthless human being.
2. And yet, at the same time, the same corporations that these very-responsible-debt-paying people owe fealty to, will perpetrate enormous fraud -- of the technical definition and just general "looks like a fraud, smells like a fraud, who cares what the law says" kind. This fraud can fuck not only other such corporations, but the entire financial system, and the country's stability as a whole.
Got it?
Debt payors are considered horrible people if they do not repay all their private debts. Debt payees, on the other hand, have carte blanche to act however they want and get excused by saying "That's the way free market capitalism works."
Thus you have individuals lambasting other individuals, and going "OH NO, you cannot just say that DEBT is NOT a MORAL OBLIGATION!" with regards to individuals who owe, but just shaking their heads and clucking their tongues with regards to the acts of corporations.
This is basically a case of the serfs policing themselves, while the nobles are pleased to promote any kind of ignoble acts among themselves.
I think that sort of one-downsmanship would spiral into even worse issues for our economy.
And, for the record, I think debt is an obligation for whoever makes it–individual or corporations.
If you don't like the way such corporations act a) don't patronize their services, b) work to change the way they are regulated/operate, c) create a startup that disrupts their business model ... but for goodness' sake, don't act like them.
And I believe over the long-term, proper education (from an early age) is the only thing that will fix this kind of problem. Buy what you need, not what you want. (OK, buy what you want too, but it should be like a 20:1 ratio!)