We now live in an America with values that Americans just a few generations back would find extraordinarily strange — upside down even. Want a simple, obvious example? Consider what our leaders think stimulates economic growth, consumer spending.
When Speaker Nancy Pelosi told us Unemployment Benefits Biggest Stimulus for Economy, we laughed. Nonetheless, as typical fare, we see news articles explaining the importance of consumer spending to the economy.
- Black Friday: Hope for economy amid holiday deals
- Consumer confidence boosts Black Friday sales
- ’Pent-Up Demand’ as Shoppers Storm Malls Across U.S.
Moreover, other leaders encourage us to spend. Long ago, a previous Congress encouraged us to buy houses with that mortgage deduction. President George W. Bush encouraged folks to spend in 2008 with a tax rebate (Pitches Income Tax Relief, Business Incentives to Boost Economy). More recently,President Barack Obama advocated the $8,000 tax credit for first-time home buyers. What is the latest? Look at this newspaper report.
Va. governor urges Saturday shopping spree
RICHMOND, Va. (AP) — Gov. Bob McDonnell is doing his part to give the retail economy a boost.
McDonnell is encouraging Virginia residents to support local businesses as part of the national “Small Business Saturday” movement.
The Republican governor says small business accounts for 98 percent of all businesses in Virginia, and for 75 percent of job growth.
He said doing your holiday shopping Saturday supports what he calls the “lifeblood of Virginia.” (from here)
Unfortunately, consumer spending does not drive economic growth. As Benjamin Franklin explained in publications such as Poor Richard’s Almanac, real economic growth comes from thrift and wise investing, not wasteful spending. See:
- American Apostle of Thrift By David Blankenhorn
- The Frugal Wisdom of Benjamin Franklin: Insightful Quotations on Thrift, Hard Work, and Money By Vicki McClure Davidson
Why do people believe this nonsense about consumer spending? Consider why the news media exists. The news media exists to provide an audience for advertisers. In order separate us from our money, the news media wants us to buy consumer goods from their advertisers. Therefore, the news media would like us to believe consumer spending is wonderful.
This Christmas, please do not waste your money. Spend your time with, not your money on, the people you love.