Every Day Is Christmas in America (as long as you have credit) (September 15, 2009)
Every day is Christmas in consumer Paradise. Is "demand exhaustion" possible?
Granted, those U.S. households without employment or credit do not feel like every day is Christmas. But those still enjoying employment and credit aren't holding back their enthusiasm for endlessly insatiable consumption.
Let's browse thorugh a few of Costco.com's "highest rated" items. I have no idea if these are big sellers, but the consumerist enthusiasm they've generated is at least somewhat visible in their high ratings earned from shoppers.
In all fairness, out of 51 items listed, a few were practical in everyday terms: diapers, shirts, electric fans and solar-powered attic vents. But the vast majority were superfluous or "luxury" items or products of questionable value even if you had unlimited money. Costco.com, highly rated items.
A semi-random selection:
security vault ($689.99)
80-jet, 6-person spa ($5,499)
booster dog bath ($129.99)
Doggy Dollars premium dog treats ($24.99)
"Bone Lounger" pet bed ($27.99)
probiotic supplements ($38.99)
two-pack long sleeve men's dress shirts ($39.99)
Here is a history lesson for the young'uns. Way back in the long-ago time, people had these crazy, ancient rituals for purchasing items they wanted. They would save a little money every week or month in things called "layaway plans" which enabled them to stash enough cash by December to actually buy the desired object with cash--just in time for Christmas!
It all sounds so quaint, like horse-drawn carriages and Abe Lincoln reading by candlelight. Yes, but it was only a few decades ago.
I wonder where people are putting all this stuff. I buy almost nothing new except books (gotta support other authors) and blue jeans/cheap pair of sneakers from Costco once a year--unless I find the right size on the curb somewhere. But even we have too much stuff--things people have given us.
I just Googled "demand exhaustion" and came up with an obscure real estate paper from South Korea. Therefore I am claiming the right to coin this phrase as a general description of the end-state of global over-capacity and the saturation of U.S. consumer "demand" for more stuff.
Classic economic theory holds that consumer "demand" is insatiable and can never be completely filled. While that is true of the FEW resources (food, energy and water) and essential items which eventually wear out like say, tires, the "demand" for everything else appears to be largely artificial now, an urge prompted by relentless advertising and the accessibility of instant credit for more purchases (credit cards).
How much of the "demand" is organic, that is, flows from human desires for additional comfort and amusement? It could be argued that all of this is "organic demand" --or in the case of the dog bed and treats, "projected demand" (since the beloved pet probably would be just as happy or even happier with an old pillow and blanket).
On the other hand, it could also be argued that the returns on investment are increasingly marginal for most of these consumer goods. How much comfort and amusement can you wring from a second or third TV or your 40th shirt? How about that spa which gets used less and less as time marches on? Shall we label this "marginal demand" because the returns are increasngly marginal?
If consumer credit dries up, how much does "organic demand" drop? How much does does "marginal demand" drop?
Shall we be blunt (yes, for a change) and suggest that the vast majority of consumer "demand" is generated by an advertising/marketing/media complex which instills a gnawing sense of insecurity in every "consumer"? Let's face it, pal: if you don't buy this for your pet, you simply don't love it very much. Ditto for your kids.
As for you, Adult Consumer--what will everyone think if you don't look sharp and pay attention to fashion? Teen Consumer--Cool alert! You've missed the trend and are compeltely out of it! Hurry and join the Cool Tribe (just buy this, this and that).
These voices of guilt and insecurity are the subtext of all adverts and marketing, and they are internalized by almost everyone exposed to thousands of ad messages.
That many of these products are parodies of consumerist excess and waste--we all know where it's all made, and how long it will last before malfunction or breakage carries it to the landfill--is painfully obvious, yet that hasn't hurt sales in the least. That reveals the ubiquitous power of the consumerist politics of experience.
You might think that "everyday is Christmas" would be some sort of Paradise: a constant flow of goodies, treats, bargains and comforts. Ironically, it seems the joy wears thin all too quickly; we habituate all too easily, even to permanent Christmas. So now, not only is Christmas reduced to a cheerless paroxym of desperate "gift buying" for those who already have more crud than they know what to do with, but the constant purchase of whatever your little old heart desires has ground down desire and the joy of acquisition alike.
So lock up your meds and ammo in the security locker, wash the dog in the leaky rusting bath (oops, one leg just buckled, dump it on the curb), settle into the spa (half the jets are defective, but the rest still work, sort of), crack open a fresh pack of Valium (or numbing agent of choice) and ponder the possibility that "demand exhaustion" might be mistaken for a merely temporary, recessionary prudence in consumer spending.
If so, Chinese manufacturers (and American retailers) have more to worry about than
tariffs on tires.
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