I Want My Markets Back

"Indeed, “consumerism” — understood as a society in which consumption growth is the prime motivating factor for companies and individuals alike — is finally being superseded historically. Though the postwar economy saw a virtuous cycle of rising wages feeding rising consumption feeding higher wages — a rising tide lifting most boats — the long crisis beginning in the 1970s saw profits and wages no longer rising in tandem. 

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The solution that allowed much of the American “middle class” to not feel the first shocks of this long crisis was cheap credit: first with credit cards, savings and loans, then in dot-com stock market investment, then real estate debt, now, increasingly, medical and college debt. But with each successive debt bubble, the working- and middle class debtors who take it on get less and less consumption possibilities. A credit card can get you into a lot of movies, so will refinancing your house; but it’s pretty hard to go out to the multiplex on dialysis money negotiated with your hospital. Student loan cash might get you to your college town arthouse cinema, but you’ll be paying off that Revenant ticket for a lifetime. 

As a result of all this cheap credit, mass consumption didn’t collapse at the same rate real wages did, but, slowly and surely, it has collapsed. By 2012, the top 5% of earners in America accounted for 39% of the country’s consumption, while the top 20% made up 61% of total consumption in America — this is a dramatic increase from even 1990, when they did just over half of American consumption. Meanwhile, the bottom 60% of America make up less than 20% of total national consumption. Of course, that is still a tremendous amount of economic activity, but it is a proportionally small one, and shrinking. 

The idea that in the postwar period everyone could participate and be represented in consumer markets was always a myth, but it is novel that, at this point, the vast majority of Americans are actually superfluous to consumption markets. Most firms selling things in America would be committing economic folly to even consider 220 million Americans when taking their goods to market. This doesn’t mean that they won’t do whatever they can to squeeze every last penny out of the hood, the exurb, and the trailer park, but it does mean that the majority of marketers, firms, and production companies don’t even need to pretend to provide things poor or even middle-class people want. Mass consumption is no longer meaningful. Markets aren’t for you anymore."

-Not For You by Willie Osterweil, The New Inquiry