Current Mood: left
Okay, I am sick of talking about money and you are probably sick of hearing me talk about money but this is more important than all the money bullshit I have previously written put together.
Current Music: daft punk - Technologic
Money is power. The more money you have, the more you can get other people to give you things or do stuff for you. That $20 bill sitting in your wallet right now? Everyone wants it. Bed, Bath, and Beyond wants you to give it to them in exchange for towels. Guitar Center wants you to use it to buy guitar strings. Barnes and Noble want you to spend it on books. Until it is gone, folks are going to try to persuade you to give them that money, and the more money you have, more of them are going to try harder to persuade you. If it is clear that you are not going to give them money if they do not change their behavior they will change their behavior. This gives you a tiny amount of control over the institutions you do business with, and is the entire point of voting with your wallet--buying free range eggs, boycotting Coca-Cola, refusing to buy anything with meat on it, and so on. Big corporations may not give a shit about your opinions but they have to listen to the market. And every dollar you spend, in theory, has an effect on the market that, in aggregate, industry cannot ignore.
The problem with this approach is the worth of a currency is relative to how much of it exists in the market. Right now, as I understand it, the vast majority of American dollars are being held in the hands of a very small minority. It does not matter if every American and every one of our trade partners who buys American decides to stop buying eggs, for example, if Bill Gates one day decides he wants a ten billion egg omelette. Granted, that's a silly example. But you see how this is problematic for things like lobby groups, luxury goods, and industrial pollutants. Sure, you can vote with your dollars--but what's the use if you have a couple thousand votes and your rich neighbor has twenty million? It's not any more democratic than an election in a banana republic. Add shareholder activism and hostile takeovers into the mix, and you have a market almost exclusively at the mercy of the rich. In recent years, the only thing your money has been good for is keeping yourself fed.
All that has changed with the recession. Fortunes have shrunk, the market has imploded, dollars are hemorrhaging in people's bank accounts instead of being circulated through the economy. CNBC today (always on where I work) did a human-interest spot called the Shrinking Billionaire's Club. Everyone across the board is worried about job security and no one is spending money. Prices have taken a nosedive. Sure, the distribution of wealth is still an L curve and the guys on top still have absurd amounts of money to use as market power. The big thing, though? They're not spending it. Or, they're spending it on settling their debts, or trying to steer Wall Street back to sanity, or fixing the recession.
This presents the dwindling number of securely employed middle and upper class Americans with a unique opportunity: If you have money you are willing to spend right now, it is worth more than it has ever been.
Think hard on the repercussions of this. In the pre-2007 economy, what happens when you buy an ice cream cone at Ben & Jerry's? B&J take the cash, put it towards getting new ice cream machines, maybe starting a new factory or a new franchise. What do the profits on a $5 pint get them? A new ice cream scoop, maybe. Wages for their workers. Whatever it takes to run a B&J's, and keep them competitive with Haagen-Dazs across the street. Now let's say it's post-2007, and for the sake of simplicity, let's say the price of ice cream hasn't change--folks are still going to eat ice cream in a recession. It's cheap, it's a low-end luxury, you can buy a cone on minimum wage. But operating costs have gone down in the recession, because ice-cream making machines are the kind of investment companies are less likely to make if they're doing poorly. You get a cone at B&J's , suddenly they can use the profit to buy two ice cream scoops--if you your friends get one too, and you keep coming back, maybe they can hire a new dude. Their business grows more with the same amount of money. Also, let's say that thanks to the recession there is suddenly only a market for one ice cream store in your area. You get a cone from B&J's instead of Haagen-Dazs, B&J's invests the profit into making better ice cream, Haagen-Dazs can't compete. Haagen-Dazs closes, and B&J's is now the leading ice cream chain in your suburban mini-mall. This is what your money does.
Let's say we're not talking about ice cream. Let's say we're talking about, say, the Red Cross. Or Doctors Without Borders. Or Common Ground's free clinic in New Orleans.
Remember how UNICEF's junk mail always says things like, "A donation of $10 will buy tetanus shots for one impoverished child. A donation of $50 will buy a water generator for a small African village. $200 will buy shelter for a week for a family of four..."
That junk mail was based on pre-2007 prices for those goods. Think about how much that same amount of money could buy now.
If you are one of the few Americans out there who are fortunate enough to have a steady income and live within your means--if you have any amount of disposable income, beyond what it takes to keep you fed and sheltered and happy and sane, beyond what is saved in your bank account for a rainy day--that disposable income, even if it is a tiny amount compared to what the rich have stored away in hedge funds and equities, bears more market power now than it ever has, and more likely ever will once the recession is over. That same share of market power, pre-2007, could have been used to buy a Ferrari. Or dumped into a campaign fund to get someone's buddy into Congress. Or invested in a flashy new LED display outside the AIG building. You hold that market power now--at least, for the first time, a meaningful chunk of it. What will you choose to do with it?
Sure, you might not have enough money to fix the recession. Sure, you might not have enough money to buy and sell corporations at a whim, or corner the stock market, or even sit in at a stockholders meeting and make your voice heard. Getting us out of the recession is still the domain of the rich. But big things are afoot in corporate America right now, and giants are falling. Today's market belongs to the rich, but tomorrow's market belongs to us.
2,773 companies enter. How many companies leave? How many will survive the contraction of the market? The rich can buy and sell and merge these companies all they want, but after the dust settles, if and when we come out of recession, which ones die and which ones stay afloat is ultimately up to us.
Are you vegan? Are you an opponent of the military-industrial complex? Are you against nonrenewable energy, cruel practices in the meat-packing industry, genetically modified organics? If so--this is the time to make your voice heard. This is the time when your money can best bring about change in this country.
Or, if you're like me, and you distrust the corporate system altogether--you can do even better. You can take that money out of the trade in goods and services altogether, and give it, unilaterally, to those who need it most. Take it out of the free market and put it into bread. And medicine. And shelter. And civil rights, and alternative energy, and protein folding and One Laptop Per Child and social justice and textbooks. If you must get something for your money, go see a local theater production. Buy drinks at a place where a musician friend is playing. Order some T-shirts from a webcartoonist. Spend it on anything you want the post-recession world to be.
By the time Wall Street has settled its debts and is ready to play poker with the market again (and I assure you, it will), it will have to do so on our terms.
My friends--if you are worried about making ends meet, paying health care costs, keeping up your cost of living, cutting out luxuries like movies and comic books just to get by, I implore you, spend the money on yourself. That money is best spent on you. But if you, like me, are looking at a steady paycheck once a month, and you've got a rainy day fund and few debts and fewer obligations, and you consistently come out at the end of the month with more money than you started with--bear in mind that that money, which you were going to take to the mall and spend without a second thought as to where it will go once it leaves your wallet--that money has, for the duration of this recession alone, the power to change the world.
If you know other reputable, societally beneficial organizations (not necessarily charities) that could benefit from a donation-fueled recession spending spree right now, please list them in the comments.