Econophobe

The Luxury Bubble

Things are out of balance. In a column entitled “Depression and Democracy” in the New York Times, Paul Krugman wrote  the other day that we should call the current economic situation what it really is: a depression. Yet Amazon is selling one million kindles per week, and big screen TV sales have not slowed. Every month, thereʻs good economic news, but its always followed by grim disclaimers that we should not get our hopes up; most recently, unemployment is down, but itʻs because there are more who have completely given up. Itʻs true that a recovery requires a lot more than 120,000 new jobs per month, but why turn good news into bad? Itʻs because ultimately Krugman is right, though not in the way he thinks.

What weʻre seeing is a cultural depression more than an economic one. And it is an economic depression – Iʻve long felt that when you add the prison population (2 million), the homeless, and other marginalized groups, we have about a 30% unemployment rate: the definition of a depression. But even more we are addicted to bad news. So much so that we create it. Publicly. Privately, we create a bubble of comfort, of luxury. It is as if we, unable to face the harsh realities of our society, retreat into a private sphere of comfort foods, furniture and fantasy, which is the opposite of whatʻs needed. This explains the continued sales of electronics, ultra-luxury couches, cars and “foodie” lifestyles that we canʻt afford.

Even in Hawaiʻi, where it was just reported that only 8% of middle class salaries can pay for a two bedroom apartment, we luxuriate in fine automobiles on which we carry a debt equal to half a yearʻs total earnings ($14,000 to be exact). Local people have been described by former Honolulu mayor Mufi Hanneman as having a “subtle inferiority complex.” The flip side of this is a blatant status complex. The previous mayor Jeremy Harris didnʻt realize when he promoted bus rapid transit the local aversion to riding the bus. It was only economic in that if you could afford not to ride the bus, you didnʻt. It was a cultural aversion that was the result of decades of second-class citizenship.

By examining our irrational economic behaviors, perhaps we can begin to do whatʻs right for our economy and society – driving less, buying less, growing and communing more. That way we can weather the depression, which, apparently is not coming, but which is already upon us.

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