I found this comment a couple of days ago. It bears on whether an economic downturn can refashion consumer taste and preference. Janice Castro puts it this way.
After a 10-year bender of gaudy dreams and godless consumerism, Americans are starting to trade down. They want to reduce their attachments to status symbols, fast-track careers and great expectations of Having It All. Upscale is out; downscale is in. Yuppies are an ancient civilization. Flaunting money is considered gauche: if you've got it, please keep it to yourself — or give some away! In place of materialism, many Americans are embracing simpler pleasures and homier values. They've been thinking hard about what really matters in their lives, and they've decided to make some changes.
The trouble is Castro made this argument in 2001, on the eve of one of the greatest moments of consumer enthusiasm in the history of the American economy. Castro wasn't just wrong. She was spectacularly wrong.
We don't know what will happen as a result of the current downturn, but this time around we should avoid rushing to conclusions.
References
Castro, Janice. 2001. “Cover Stories: The Simple Life Goodbye to having it all.” Time Magazine. June 24 http://www.time.com/time/magazine/article/0,9171,156757,00.html (Accessed April 5, 2009).
She could simply have called the inflection a little early 😉
A good point, Grant. One of the biggest failings of our 24-hour news cycle world is endlessly rushing to conclusions. Perhaps we should all follow Nassim Nicholas Taleb’s model and only look at news every couple of weeks or so—the principle being that a story that survives our not paying attention to it for at least a fortnight is probably worth paying attention to.
I’ve read a lot lately about the economy permanently affecting consumer behavior. Is this a probability or wishful thinking? I’m inclined to go with the latter. The need to acquire, for status reasons or security or whatever, seems to be pretty deeply embedded. It’s a big leap from people trading down (out of necessity) and saying they “want” to reduce their attachments. What I see in my personal everyday are people waiting for life to return to pre-recession conditions. They see the downturn as a rude interruption, not a game-changer. Of course, I could be misinterpreting what I see. And maybe people will change if the recession goes on long enough. All of this is to say that I couldn’t agree more, Grant. Who really knows what’s going to happen?
Actually, if I’m not mistaken, this article was first published in 1991…
http://www.time.com/time/magazine/article/0,9171,972670,00.html
Then you do the math about what it implies for the 1990’s decade, and the plausibility of any statement of this kind. When the *real* crisis will hit the USA (with the decline of worldwide oil production, lack of mineral resources, overpopulation, and all the good things that await us within the next 10 years), the consequences are highly likely to be a disaster. (I’m from France and it won’t be much better here.)
Gabriel. Thanks! Indeed. On the other hand, new energy reserves and the return of some manufacturing and maybe someway a new political consensus and things might work out! Thanks again. Best, Grant