Trickle Down Economics, or Since My Job Went Away
Since my job went away:
- I spent about half as much as I otherwise would have spent this past Christmas.
- I have gone from eating out 2 or 3 times a week to eating out about once every other week.
- I occasionally order takeout from my favorite restaurant instead of dining in and having to leave a tip.
- I have postponed indefinitely paying a local artist to paint a baseball mural on my son’s bedroom wall.
- I have turned down at least 7 or 8 offers from unemployed men looking to earn $10 or $20 to shovel snow from my driveway and sidewalk.
- I have stopped buying meat from my local butcher, buying instead a cheaper product from the grocery store.
- I have put off purchasing a new car to replace the 1999 Ford we drive with 93,000 miles on it.
- I am drinking much more tap water, less soda, less beer, and less wine.
- I did not renew membership in my university’s alumni club.
- I did not renew my subscription to National Geographic.
- I am postponing indefinitely the purchase of new living room furniture which we desperately need.
- I did not give my regular donation to the American Foundation for the Blind, a charity I have supported every year for at least 20 years.
- I did not send one last contribution for the year to the American Cancer Society.
- I did not respond to the most recent solicitation from the American Heart Association, another charity I have supported every year for at least 20 years.
I don’t know if the company I work for did the right thing when it announced major job cuts last month. I have an opinion, but it is only an educated guess based on assumptions that may or may not be correct. Maybe the company did exactly what it had to do. Maybe.
What I do know is this: As a result of its decision to release me from its employ, an awful lot of big corporations, local businesses, charities, and people in need are receiving far less from me than they would have if my position had not been eliminated.
Another thing I know is this: The United States economy lost at least 2.4 million jobs in 2008. Look at all of the cuts I have made in spending and charitable contributions, and multiply that by 2.4 million.
Welcome to trickle down economics.
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Matt Paust
Travelight32
PoliticallyIncorrectDonna
Just Thinking...
Jeanette DeMain
LadyMiko
Salon.com
Comments
you're right though. when companies decide to make further job cuts (and as you say yours may have had no choice) it just adds to the snowball effect of economic destruction that's taking place. i hope i'm wrong but my gut tells me that things are going to get a LOT worse before they get better. rated for timeliness.
al, I'm not against capitalism at all. It isn't perfect, but we haven't come up with much better, I'm afraid. Of course, we don't have a true capitalist society, either. What we have is capitalism infused with government supported oligarchy and plutocracy. I agree with your implied sentiments on that.
Instead, those at the top divide the world into two classes; shareholders and “inferiors” (consumers). Noam Chomsky has some interesting points on this:
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www.chomsky.info/interviews/20070402.htm
At a shareholder's meeting of Allianz AG, major shareholderHans-Martin Buhlmannn expressed the view that there is only one limit to the increase of the dividend: "The inferiors must not be bled so much that they can no longer consume. They must survive as consumers."
There was a famous case called “Dodge v. Ford.” Some of the stockholders of the Ford motor company, the Dodge brothers, brought Henry Ford to court, claiming that by paying the workers a higher wage, and by making cars better than they had to be made, he was depriving them of their profits – because it’s true: dividends would be lower. They went to the courts, and they won.
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Dodge brother were able to sue Ford for depriving them of their “dividends” by paying employees better wages and for building a better product? WTF? Not much has changed except for having continued to proceed in that same direction, I think.
You seem to feel as we do, that cutting back on giving is the worst pinch. Especially now that it's obvious that more and more people need help; our local food bank is getting swamped with people, but unfortunately not with food.
I can only send you best wishes, and add that I hope you can continue to make posts here. Your contributions are among the best on OS, and help all of us think more clearly about a lot of things.
Rick, as usual, you bring a pithy perspective, and thank you for that. The case you cite is really incredible, in every sense of that word.
kestral, what a kind thing to say. Thank you. All the best to you in this new phase of yours and your husband's life! BTW, as long as I feel like I have something to say, I'll keep posting!
I may be a catastrophist, but seeing what's happening on a global scale, I can only conclude that the entire species is going to be forced to fundamentally alter the way we interact with each other economically.
Production and Consumption for their own sake have just proven unsustainable.
Thank you for this post.
It's terrifying.
Biblio, what distresses me more than anything is the effect situations like mine will have on worthy charities, and on the man that has to support his family waiting tables with far fewer patrons, or the small businessman whose customer base is disappearing. I don't bemoan the loss of McMansions or grotesquely conspicuous consumption. But as you know, the problem goes well beyond that, now.
Hope someone slaps their own head real soon and realize what good you can do for them.
You know, the first time I heard "trickle down economics" was during the Reagan administration. It made me mad then, it still makes me mad. What it is is code for greed and selfishness--"I get mine and then maybe you can feed on the crumbs."
Larry, I will be on your post later tonight, when I have time to really absorb what you have to say. I'm looking forward to it. Thanks for stopping by.
It's never worked. The only trickle we feel in the middle and below is the trickle of piss from the pricks above.
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Good luck and I'm thinking about you on your search my friend.
All the best, Steve. May this new administration get things going for the better.
Capitalism, like communism, is an interesting economic theory. But just as no one has ever practiced communism on a national scale, neither has anyone ever practiced capitalism on a national scale. What we practice is corporate cronyism, and that is just as evil as fascist communism.
Any system that allows a few to make millions (or even billions), while allowing others to starve, is no system to boast about or try to force on other nations.
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Greg, trickle down is happening, but not in the way Reagan's boys envisioned it!
Lea, things will get better. It may take a while, but it will improve. And I suspect we'll all be stronger when it does.
Tom, Senator Harkin is a wise man! And you are correct. Capitalism, as it has been practiced in America, infused as it is with oligarchy and nepotism, is a sick beast, made all the worse by the greed that produced the illusion of wealth built on a house of cards. And the bigwigs continue to rake their $20 million salaries while they lay off the people who produce the goods and purchase the end product.
Is this some kind of hardship joke list?
I am truly sorry you lost your job and wish you the best. But most of the cutbacks you mentioned strike me as out-and-out luxuries when compared to people I know here who're out of a job and may be out of their homes, have only rice to eat, are taking buses to low paying jobs, can't afford shoes for their kids ... please, give me a break here.
I know this comment will twist the shorts of almost everyone here, and I'm sorry for that. It's unintentional But the list and the accompanying sympathy for the loss of things like "new furniture" suggests that you're all out of touch with the really poor who've been living most of their lives drinking tap water. The sense of entitlement here is eye-ball level.
And couching it in all as some proof against so-called trickle down economics is political bullshit and diminishes the truth of people who are living in real poverty.
Steve, again, my best wishes for you and your family. I've been out of work and it ain't fun. But get back to us when you're in a bread line, selling apples on the street or stuffing old newspapers in your shoes.
If you think this post was to lament my personal experience, I'm sorry I must not have done a very good job of getting my point across.
It's the people I know who have played by the rules their whole lives, and are now being let go callously, after years of exemplary service to a company, that are in shock that the system isn't what they thought it was. It's the people who are discovering there is no longer a safety net who are rethinking their "conservative" politics of the last three decades.
John Boni mentions the truly poor, and his point is well-taken, too. But -- and I'm certainly not excusing the way the poor are either ignored or mistreated in this country -- but, it's ironic that in some ways they will be less dramatically affected precisely because they had so little to lose.
In my book, I made what some considered a perverse statement, but it is factually correct. FOr many here in the mountains of Appalachia, the Great Depression passed by all but unnoticed because it did not change their lives much. As always, they struggled by with subsistence farming and little or no money.
I'm no so sure hard times will pass so easily in these environs this time, however.
And by the way, the picture you present, lucid as it is, is not even the complete picture, since even people who are still working are, if they're wise, cutting back in order to prepare for the possibility of being in your shoes... Few of us are immune, it's just that some of us have been so far lucky.
My family has cut back on eating out, but we try to still go once in a while to the restaurants so the ones we really care about will still be there, and as a way of supporting the local economy. We're also trying to watch the “Made in” labels on things and make sure that what dollars we spend go to local producers (even in cases where it costs a little more) on the theory that this keeps people employed and generates tax revenue. Buying locally grown foods is another way to contribute to the local economy, not to mention to help the planet a bit since less transportation cost is involved.
One way to address the charity issue is to give to a charity on behalf of a friend. I'd much prefer someone did that rather than go to Wal*Mart and buy some piece of imported plastic junk I probably don't even need... Raising your kids to think this is a cool idea would be a great contribution to society.
We too, had to decline donations at the end of 2008, and it makes me feel like a stinker, but I tell them the truth when they call. Husband was laid off, collecting unemployment now---things are just too tight. I end up feeling a little guilty about it.
I live in a place where people act like this isn't happening. It makes me sick. They think the entertainment industry is recession proof---I've taken to asking, "How about Great Depression proof? "
Lu&Phoeb & Toni, it's the impact on charity that I find most distressing. That, plus the impact on those who are working, but in very low paying service sector jobs, who will lose income they can't afford to lose when people like me cut back. I feel for them, and it is sad.
Lisa, one gets the impression the government is a tad out of touch, huh!
Kent, I'm glad you stopped by. We are apparently living in the beginning of a new era of frugality, even among those still employed. To your last point, I really like it when people who are not lacking ask for charitable contributions instead of a gift.
Catamite, thanks...I'm glad you stopped by.
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Its true, the butterfly effect.
thanks for the honesty & moving post.
My premature post mis-understood the point of yours and on rereading it, I get the context in which you wrote, which I should have got the first time around. So for my surly comment, I apologize. The point that your job loss has consequences is a valid one and I jumped past it in my quickness to respond.
I don't think you're right in referring to it as "trickle down" economics, which rings unnecessary political bells (as evidenced by the Reagan mentions in subsequent comments) and isn't accurate regarding that particular economic philosophy.
Of course a belt-tightening for one means a belt tightening for those once included in the first belt, and so on. But this is the nature of economics, period, the nature of survival.
Again, sorry for the loss of your job and for my original comment.
Your point is well taken as to the use of the charged term "trickle down economics" -- I could have elaborated a bit on that to make it clear I was not speaking of it in the Reaganesque sense, but in the sense that individual spending cuts trickle down throughout the economy.
I've been musing on all this in the blog I started the day I was let go: firedfornow.com
Yes, we are writing about it :)
Your bio suggests you aren't even actually unemployed, but got a layoff notice last month and have "three weeks left". And after that, maybe six months of severance pay and health insurance, and then NINE months of unemployment pay -- right? And let me guess: your wife works at a decent job still, you have money from an employment savings plan or maybe a small inheritance. You can't be seriously worried if one of your FIRST sacrifices is a "baseball mural on your son's bedroom wall".
There are people out there who don't have anything to eat, or who will be evicted in the New Year and out on the street. They'd give anything to have a '99 car with less than 100K on the odometer -- because then they'd have something to live in. It wouldn't even have to run!
You are awfully smug. I guess it's nice to feel that secure, to be able to lecture people about "only eating out every other week", when many of us can't eat out EVER.
You are living in a dream world, where this actually seems like deprivation. Maybe you are lucky and nothing seriously bad will ever happen to you! I certainly hope so because you clearly haven't a clue about what "cutting back" really entails.
Do we really need to be destitute and living out of our cars before we are allowed to be absolutely *pissed off* at how the last 30 years has altered this country's wealth distribution? Must we be living under a bridge before we can scream and holler that the middle class is disappearing?
I think we all realize we here at OS are fortunate compared to others who can't afford a computer or who don't know how to blog. But that doesn't mean we shouldn't discuss how this is all effecting us, even those of us who are still employed .
Steve can take care of himself, but I had fallen into the same trap your post suggests. It's not that Steve is complaining about what he can or can't buy, enjoy or can't enjoy, only that he is pointing out that by NOT buying the mentioned items, giving to charities and cutting back on certain things, other people's jobs and well being are being affected because of it, e.g., the tips a waiter would be getting from him from eating out several times a week. Multiply that by other Steves and the waiter might be himself out of a job, or unable to pay his rent or whatever.
Does the person with insulin-dependent diabetes less deserving of our understanding than the blind person with the working dog?
Does the person with restless leg syndrome not even deserving of acknowledgment next to the person in a wheelchair?
All of our experience is relative as is sacrifice and hardship.
As for Laurel962, she posts letters under the same name at Salon.com, and there's a long and rich seam of hostility to people whom she perceives as being over-paid, frivolous, or otherwise not hardworking midwestern volk - especially coastal zone inhabitants who have the audacity to suggest that public transport and other alternatives to the car are a good thing, but that's hardly her only area of scorn.