Laying It Out: This Christmas, imagine something better than this
By Scott Schmidt on December 4, 2021.
As the Holiday Season arrives, it feels like a number of people are putting emphasis on tighter budgets. Whether due to financial strain, or simply finding truer meanings behind the occasion, living with COVID-19 has seemingly changed how a number of people view this time of year. Predicting collective behaviour is difficult, so it’s entirely possible the result of December 2021 is record sales in retail stores and restaurants. But in the interest of making a point, let’s look at a hypothetical world where slashed Holiday budgets is a ‘new norm.’ Generally speaking, one of the best economic decisions an individual can make is to not spend money. The more you don’t spend, the more you have, and we can all agree more money is better than less. Sure, there are ways to make money from spending — a world monopolized by the privileged — but for this exercise let’s centre “spending” around the non-essential products and services that make up the bulk of our economy. And, let’s face it, when it comes to things we don’t actually need, no time of year is quite like this time of year. But while we can all agree saving money is a smart decision for the individual, if everyone did it at the same time, it would be detrimental to the economy. Just look at businesses deemed non-essential when COVID restrictions were in place — without customers, we all saw the negative effect on sales, jobs and employers. A lack of spending devastated the economy so much that a portion of the community — including our MLAs at times — were willing to risk human life to stop the bleeding. And so, the question becomes, how can something viewed as intelligent individual management of finances be so bad for the economy? The answer, unfortunately, is that’s how this system works. Money in your savings account is not in the economy, and while individuals might think about returning that money during retirement years, for example, it isn’t doing the rest of us any good until they do. In fact, the more you save, the bigger an economic problem it becomes — when money goes out, it needs to be replaced. Of course, the process of money leaving the economy is never ending, but much to the chagrin of the ruling class, you aren’t the problem. I touched on this in a recent column, but the system has evolved to a place where most people simply return to the economy all they earn — it’s called living paycheque to paycheque and the number of Canadians doing it grows every day. The annual BDO Affordability Index in 2019 (before COVID made everything worse) showed 53% of Canadians living from one cheque to the next, with 27% unable to make ends meet, 57% carrying credit card debt and 40% with non-mortgage debt topping $20,000. In Alberta, which leads the nation in consumer debts, non-mortgage debt averages close to $30,000. With about 3.5 million adults in the province, that’s roughly $105 billion (but please, keep pretending provincial debt is our problem). The point is, we are already conditioned to spend what we earn (don’t forget, buying things will make you happy) and we are so married to the idea, millions of Canadians have sacrificed their golden years to do it — 40%, by the way, have no retirement savings, and the bulk of those who do are already there. Most Canadians coming up behind are in big trouble when they can no longer work, and you better believe the public spending needed to deal with that will be immense. The real kicker is, if we hadn’t racked up that $105 billion in debt, what would that have meant for our economy? What would that have meant for Alberta’s business owners? Or its workers, for that matter? Can the strength of our economy really be this reliant on debt? The answer, of course, is yes. Capitalism isn’t just reliant on debt, it is debt. Money begins as debt and remains as debt, regardless of who ends up owing — our economy just happens to be constructed in a way where all that truly ‘trickles down’ is the onus of it. Meanwhile, so much hoarding of wealth goes on at the top that the mega wealthy have lost all tangible ways to even attempt to put their money back in the economy (do a search for ‘metaverse’ and try to wrap your mind around digital yachts for $650K, or imaginary plots of land for $2.5M). Call me a “leftist nut” if you must, but capitalism has been a completely unchallenged system for 30 years and while a very select few have hoarded so much profit they aren’t able to stop even if they try, more than half the people in the richest countries on earth are in actual financial crisis — never mind those who live outside developed nations. If pointing out this fact makes me the problem, feel free to email me with an explanation as to why inevitable growing inequality and crisis of personal debt is a good thing. Again, we tell each other that personal restraint is all one needs to make it, but it’s clear the economy can’t exist if everyone actually did that. The good news in all this is we created the economy this way, and if we so desired we could fix it. Sadly, we are also conditioned to be afraid of real systemic change, and anyone who dares mention the insane level of inequality is dismissed with conversation-stopping rhetoric about ideology. Meanwhile, labelling voices like mine as simply “leftist B.S.” conveniently keeps the discussion from ever reaching the one place it should always start: our economy is not constructed for the people. And that’s really dumb. Scott Schmidt is the layout editor for the Medicine Hat News. He can be reached at sschmidt@medicinehatnews.com, or follow him on Twitter at @shmitzysays 24-23
