DouglasChick's Blog

Conspicuous Consumption Economics

Conspicuous consumption is the force that drives the U.S. economy. If the consumers are not consuming, then the economy is not moving. But it takes more then just spending to spur growth. If consumer goods are not manufactured locally, the proceeds from the sales are not retained locally. If the jobs that create these consumer goods are sent to another country, then it is that country’s economy that benefits from our conspicuous consumption. All we benefit from are a bunch of consumer goods that ultimately end up populating our land fills.

Now let's look at China's booming economy. Because so many jobs and manufacturing have been sent to China, this means that their economy is flooded with U.S. payroll dollars. Now the Chinese people have money for consumer goods. U.S. businesses may have larger bottom line profits because of overseas outsourcing and sending factors to China in the short term, but in the long term, it will be the Chinese people and their businesses that will cut them out of the middle.

A real stimulus plan for the U.S. should have long term benefits, not short term goals that borrow American money from China, and then loan it to Americans, that have to be paid back to China. For real long term growth, (This means economic growth after the elections) Factors and jobs have to come back to America. But before that can happen, healthcare has to be fixed. Healthcare costs are too much for a company to make a profit.

Douglas Chick
DouglasChick@gmail.com