"When U.S. corporate profits are unusually high, it’s typically an indication that households and the government are cutting their savings and going into debt." Pretty much one of the reasons why I dislike the current economy and what I mean by treating people as "consumers" to be extracted from. This has been a problem since the 1970s.
BTW, the way the current economy works is also why revenue of for example Sun and Novell declined quickly. I have an entire paragraph about that in the essay.
I mean treating people as consumers to extract more and more money from. Note that I am just saying that the current economy encourages such a culture too.
Consumer culture was created really at the dawn of the 20th century. The elites realized that in order to keep 'growth' going they had to get people to continuously 'buy stuff'. Hence consumer culture has been systematically promoted since then.
I once visited a friend in London, his family had a really nice property, worth millions for sure. And then in this kitchen some really funny ancient oven and toaster stuff. It still worked fine. So why replace it? North Americans just keeping buying new, we're the epiphany of that culture.
But at some point in your career you might connect the dots and realize you need people to 'buy buy buy' in order for your sales to remain healthy and for you to keep your job so you can support your family etc. etc..
It's a weird vicious/virtuous circle and I don't thin UBI etc. will solve it. There are innumerable actual innovations and advancements that come out of the rat race :).
> Consumer culture was created really at the dawn of the 20th century. The elites realized that in order to keep 'growth' going they had to get people to continuously 'buy stuff'
This reverses cause and effect. For most of human history, real productive capacity didn't change from generation to generation. Elites fought to sit on more stuff; there was no point bringing peasants into the mix.
The industrial revolution (and the Black Plague, in Europe) changed that dynamic. Real economic growth became a thing. And workers needed to be competed for. That gave them bargaining power in the economy, which they converted into re-tooling it away from solely making toys for the elites and towards producing goods and services for the masses.
It's always comforting to imagine some disembodied "elites" calling the shots and making a plan. In reality, our systems are more chaotic.
If so, the parent post couldn't have chosen a more ironic example. AGA cookers are a ridiculous Veblen good, regardless of age.
If the AGA is new (within the last decade or two), those people spent tens of thousands of dollars on a freaking oven. That's more than most people would spend on an entire kitchen remodel.
If the AGA is not new (from before 1990 or so), it's horrendously energy inefficient. A modern sub-$1,000 oven would pay for itself in energy savings in no time.
Note that what I mean is that it is not just to buy stuff, but also to extract as much profit as possible. And commodities where that isn't possible tends to be outsourced to other countries like China, making our trade deficit worse.
