The Holiday Shopping Season Will Not Deter A "Severe Recession" To Come
BOSTON MA November 24 2007: You could almost run that old Lone Ranger theme -- the famous William Tell Overture -- as the soundtrack to the local news stories I watched here in Boston on Thanksgiving day featuring perky local news "correspondents" stirring a buying frenzy with upbeat reports on manic consumers racing into malls for "midnight madness" sales.
It was, in the words of Reverend Billy of the Church of Stop Shopping, a "shopopocalyse." His crusade against out of control consumption is pictured in the new film What Would Jesus Buy? opening at some theaters in LA and San Francisco.
This highly relevant film was not on TV, of course, because our media is deeply complicit in promoting/encouraging mindless consumerism through newspapers, commercials and on newscasts. This is a well-practiced formula mirroring TV's promotion of the war in Iraq, as the line between selling and telling disappears. Media outlets are amply rewarded with endless ad revenues hyping all the discounted goodies you can get with the Boston Globe packing no less than 43 advertising/sales supplements (down from 47 a year ago) into a paper that had wall to wall Macy ads, including some offering $10 coupons to bribe you the stores. Marketing is what the media does best.
The only negative note was the fear among some that toys might be unsafe because of lead or other dangers. Some 26 million toys have been recalled this year, assign that the regulators were asleep on this front in the economic wars as they were on Wall Street. The real danger may not be lead in the toys but another type of lead in our heads that leads to denial on the part of millions that we can go on with addictive well-cultivated crazed consumption habits.
Bill Bowles writes about this on his CNI Blog:
"The problem is that many of us have been force-fed with a diet of nothing but passive, uncritical consumptionism, indeed, we are addicted to the stuff; breaking such powerful habits is what this is all about; it's about getting people to think critically again about what's going on and why and what, if anything, we can do about it."
Bowles also ties this cultural affliction sometimes known as affluenza back to our dependence on a media system that won't really allow other voices to be heard:
"It would be an understatement to say that the world has changed almost beyond recognition in the past two decades, we appear to have re-entered the age of the dinosaur, gigantic creatures stomping across the planet, 'guided' by pea-sized brains. So ... we have increasing concentrations of powerful media--media that is actually an entire raft of processes critical to the survival of capitalism--either in the hands of vast corporations or the state (which in any case is now openly in bed with the big corporations)..."
Were most media outlets connecting any dots between the annual shopathon and the "severe recession" that many economists are forecasting? Were there any warnings to the public to save their rapidly inflating money for the expected hard times? Was there any explanation of how prices have sharply risen and, thus, the discounts--often "teaser" rates just like the ones offered sub-prime loan victims---are really not all they are cracked up to be?
What about the larger trends? Yes there has been reporting on how bad things are--but this reality was largely NOT depicted in the 'shop now, be happy' coverage. The Globe did run a story in the B Section where the business news is buried. At the very end of the AP report (not theirs) you read this:
"Last year, retailers had a good start during the Thanksgiving weekend, but many stores struggled in December and a shopping surge just before and after Christmas wasn't enough to make up for lost sales.
This year, analysts expect sales gains to be the weakest in five years. Washington-based National Retail Federation predicted that total holiday sales will be up 4 percent for the combined November and December period, the slowest growth since a 1.3 percent rise in 2002.
Holiday sales rose 4.6 percent in 2006 and growth has averaged 4.8 percent over the last decade."
Where were the stories alerting us to this coming calamity on the front pages? They weren't there. It is not in their interest to carry them, clearly a big No No. It gets worse. MTV pointedly rejected an ad from the Cultural Jammers Network urging a "Buy Nothing Day." The network complained, "The station that markets itself as the voice of hip youth has censored the burping pig."
But why? "Their advertising standards representative, Elisa Billis, said that "the spot goes further than we are willing to accept on our channels." Too radical for MTV which routinely carries military recruiting ads with no qualms.
The Globe did carry a cartoon lampooning local sports mania in a town with winning teams. In its last panel, set in a mortgage office, a fan is being told he will be able to pay off his Red Sox/Celtics/Patriots tickets in just a few decades.
Many of the shoppers this season are charging it even though all the credit card companies have jacked up rates driving the real cost of shopping higher, and even though credit balances are at an all time high. The companies are just waiting for them. The day after Christmas, VISA will report on how much business was done. In years past, they called it "disappointing."
And then in January, the returns will start as the bills come due. Experts--including former Treasury Secretary Larry Summers--are warning that the credit card system may be the next to fall.
Writes economist Robert Samuelson:
"The spectre of the subprime debacle is that it's just a start. Huge amounts of auto loans, credit-card debt, commercial mortgages and equipment leases have also been securitised. If similar problems emerged, it would shake confidence in the securitisation model and, by magnifying investors' losses, threaten to turn the credit crunch from a slogan into a reality. A broader crisis, though a long shot, can't be excluded."
Thanksgiving this year fell on the anniversary of the John F Kennedy assassination. The New York Times predictably marked the event with one more op-ed article -in a long line -- assuring us that there was no conspiracy. (Even as 80% of the public continues to believe that Lee Harvey Oswald did not act alone.)
While they discredit suggestions of a past conspiracy, they seem to be ignoring a current one. That involves the steady decline of our economy thanks to illegal practices through white collar predatory lenders backed by our biggest banks and hedge funds, as well as the inability regulators to regulate and a complicit media to blow the whistle, caused a multi-billion dollar economic crime that is still in progress. It has already defrauded millions of investors, and homeowners and the squeeze will only get worse.