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Musings Report 2024-19 5-11-24 The Illusion of "Growth" in a Social Depression
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The Illusion of "Growth" in a Social Depression
"Growth" as measured by Gross Domestic Product (GDP) and household wealth are the universal indicators of "progress": everything's getting better in every way, every day because economic activity and wealth are expanding.
But this "growth" and the "progress" it supposedly generates are entirely illusory if the "growth" is limited to the wealthiest 10% and the social order is unraveling in a Social Depression that is completely missed by GDP and wealth metrics.
The facts of inequality are beyond dispute. The top 10% of U.S. households own 90% of financial assets and the vast majority of all income-producing assets such as family / professional businesses and rental housing, and the top 10% account for roughly 40% of all consumption / spending. The bottom 50% of U.S. households own a negligible 2.6% of the nation's financial assets.
The Top 10% Are The Main Beneficiaries Of Globalization
If all the "growth" in consumption and wealth is concentrated in the top 10%, and the rest of the populace is stagnating or losing ground, is this "growth" and "progress," or is it the opposite of positive growth and real Progress? Clearly, it's the opposite of positive growth and real Progress.
The decay generated by the drivers of this extraordinarily destructive inequality--hyper-globalization and hyper-financialization--is visible not in easily manipulated economic statistics but in observations and metrics of social opportunity and stability.
The conventional metrics (GDP, etc.) do not recognize, much less measure, Social Depression, i.e. the social costs of economic stagnation and wealth inequality.
Some commentators attribute this erosion of the social contract to rampant individualism and overstimulated consumerism, while others point to the commodification of child care and women entering the workforce en masse to prop up household incomes. Poverty is explicitly rejected as a causal factor, hence the term "social recession."
This concept of social recession was aptly described by Robert E. Lane, author of the 2000 book The Loss of Happiness in Market Democracies:
"There is a kind of famine of warm interpersonal relations, of easy-to-reach neighbors, of encircling, inclusive memberships, and of solidary family life... . For people lacking in social support of this kind, unemployment has more serious effects, illnesses are more deadly, disappointment with one's children is harder to bear, bouts of depression last longer, and frustration and failed expectations of all kinds are more traumatic."
Lane found that "the main sources of well-being in advanced economies are friendships and a good family life and that, once one is beyond the poverty level, a larger income contributes almost nothing to happiness. In fact, as prosperity increases, there is a tragic erosion of family solidarity and community integration, and individuals become more and more distrustful of each other and their political institutions."
The core dynamic of social recession described by Lane is what he terms the "Economistic Fallacy": that rising wealth and consumption automatically translate into greater happiness.
I use the term Social Depression to describe a very different phenomenon: the economic, social and cultural consequences of structurally stagnant, increasingly distorted-by-vast-inequality economies.
Here are the conditions that characterize social recession:
1. High expectations of endless rising prosperity have been instilled in generations of citizens as a birthright.
2. Part-time and unemployed people are marginalized, not just financially but socially.
3. Widening income/wealth disparity as those in the top 10% pull away from the shrinking middle class.
4. A systemic decline in social/economic mobility as it becomes increasingly difficult to move from dependence on the state (welfare) or one's parents to financial independence.
5. A widening disconnect between higher education and employment: a college/university degree no longer guarantees a stable, good-paying job.
6. A failure in the Status Quo institutions and mainstream media to recognize social recession as a reality.
7. A systemic failure of imagination within state and private-sector institutions on how to address social recession issues.
8. The abandonment of middle class aspirations by the generations ensnared by the social recession: young people no longer aspire to (or cannot afford) consumerist status symbols such as luxury autos or homeownership.
9. A generational abandonment of marriage, families and independent households as these are no longer affordable to those with part-time or unstable employment, i.e. what I have termed (following Jeremy Rifkin) the end of work.
10. A loss of hope in the young generations as a result of the above conditions.
Once we reach an unpredictable but very real socio-economic Event Horizon, social recession becomes Social Depression: a black hole of deteriorating social mobility and opportunity for the younger generations which leads to social-economic decay and eventual collapse if left to "run to failure."
Japan has managed to maintain its status quo for the past 34 years--those with the wealth and power have retained the wealth and power--at the cost of social vitality. Younger Japanese, their expectations permanently downsized, are increasingly opting out of the rigid social systems on which Japan, Inc. was built.
Consider these developments in Japan's society and culture:
-- Once-egalitarian Japan is increasingly a nation of haves and have-nots.
-- More than one-third of the workforce is part-time as companies have shed the famed Japanese lifetime employment system.
-- The average "freeter" (for part-time worker) wage is 1,280 yen an hour ($8.22). Older, more experienced part-time workers may earn 1,630 yen per hour ($10.47).
-- As long ago as 2001, The Ministry of Health, Labor and Welfare estimated that 50 percent of high school graduates and 30 percent of college graduates now quit their jobs within three years of leaving school.
-- Japan's slump has lasted so long, a "New Lost Generation" has come of age, joining Japan's first "Lost Generation" which graduated into the bleak job market of the 1990s.
-- These trends have led to an ironic moniker for the Freeter lifestyle: Dame-Ren (No Good People). The Dame-Ren (pronounced dah-may-ren) get by on odd jobs, low-cost living and drastically diminished expectations. This lifestyle is called "lying flat" or "let it rot" in China, a lifestyle that is increasingly common as China's economy enters stagnation.
-- Many young Japanese men now reject the work ethic and related values of their fathers. These "herbivores" reject the traditional Samurai ideal of masculinity. Derisively called "herbivores" or "Grass-eaters," these young men are uncompetitive and uncommitted to work, evidence of their deep disillusionment with Japan's society and economy.
"People who grew up in the bubble era (of the 1980s) really feel like they were let down. They worked so hard and it all came to nothing," says Ms Ushikubo. "So the men who came after them have changed."
-- These shifts have spawned a disconnect between genders so pervasive that Japan is experiencing a "social recession" in marriage, births, and even sex, all of which are declining.
-- The Social Depression has generated a social disorder known as Hikikomori, or "acute social withdrawal," a condition in which the young person will virtually wall themselves off from the world by never leaving home, or leaving home only to work or get groceries.
-- This trend of social withdrawal has sparked an almost tragicomical countertrend of Japanese parents who actively seek mates to marry off their "parasite single" offspring as the only way to get them out of the house.
The United States is following the same trajectory of Social Depression: marriage and birthrates have declined sharply, young people are unable to afford homes or middle-class security, rates of depression, anxiety, addiction and self-harm are rising, and the frustrations generated by stagnation are evident to anyone who dares open their eyes.
Like Japan, the U.S. has managed to maintain its status quo--those with the wealth and power have gained more wealth and power while the bottom 90% stagnated or lost ground--at the cost of social vitality. When opportunity diminishes to the point of hopelessness and disillusionment, reliance on the top 10% to keep accumulating more wealth and consuming more via "the wealth effect" is a pathway to Social Depression and the resulting economic decay: no economy can "grow" in any productive way if its younger generations have given up on marriage and family.
In sum, the illusion of statistical "growth" is not actual growth, any more than "progress for the top 10%" is actual Progress for the nation and its entire populace.
Highlights of the Blog
Lost in the Vast Wasteland of Social Media 5/8/24
Hikikomori and Lying Flat: When "Making It" Becomes Hopeless 5/7/24
Withdrawing from the Rat Race Is Going Global 5/6/24
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Gardens don't have to be big to be useful; a small patch is enough to grow things like lemon grass, shallots, green onions and herbs. Here's my go-to mix for a quick dinner: garlic (commercial, not from our yard), diced lemon grass, shallots and diced shallot tops (all from our garden). Simmer in olive oil with a dash of salt and pepper to release the flavors and add whatever you want, tofu, shrimp, fish, chicken, pumpkin, etc., and serve with brown rice. Quick and flavorful.
From Left Field
NOTE TO NEW READERS: This list is not comprised of articles I agree with or that I judge to be correct or of the highest quality. It is representative of the content I find interesting as reflections of the current zeitgeist. The list is intended to be perused with an open, critical, occasionally amused mind.
Many links are behind paywalls. Most paywalled sites allow a few free articles per month if you register. It's the New Normal.
Husband of F1 Heiress Delivers Whiny Tirade Against Tipping
Science shows how a surge of anger could raise heart attack risk (via Cheryl A.)
A Question To Challenge The Deflationary Mindset -- inflation or deflation? The debate continues....
AI Can Tell Your Political Affiliation Just by Looking at Your Face, Researchers Find (via Richard M.)
Startling Discovery: Cancer Can Arise Without Genetic Mutations
Imagine living in a 4-foot body that doesn’t develop chronic diseases (via Cheryl A.)
The Critical Role of Monounsaturated Fats for Longevity and Disease Prevention--worth a read, given all the conflicting opinions about "healthy fats and oils"....
The Real Reason WALMART & Others Are Removing Self-Check Out Lanes--theft via selecting a lower priced item when buying a non-UPC item....
How Much Unpaid Domestic Labour (Mostly Done by Women) Is Actually Worth -- shadow work is real....
Why neoliberalism failed--worthy summary...
Maui looks to cut back on Airbnbs for tourists as early as next summer: Across Maui, more than 12,000 housing units legally operate as short-term rentals, and officials estimate an additional 10,000 do so illegally, according to the governor.
Akiya houses: why Japan has nine million empty homes-- many videos make it look like there are plenty of houses in good repair available, but I suspect this is a distortion of the reality: most "cheap" homes are in rural areas and are not in good repair....
"Success usually comes to those who are too busy to be looking for it." Henry David Thoreau
Thanks for reading--
charles |
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