Newsweek?s cover story for Dec. 6 asks a good question: ?Why can?t Americans stop spending?? They did for a while, spooked by the Great Recession. They paid down debt and started saving. But it didn?t last long.
?Frugality fatigue? is what market analysts call it. Americans, fed up with the New Austerity, are beginning to splurge on such non-essentials as face-lifts, nose jobs, and fancy cars. One Las Vegas cocktail waitress portrayed the attitude succinctly: ?You stop spending and you stop living.?
Another anecdote courtesy of consumer Hope Good:
Before the recession, Good, who lives in Palm Beach, Fla., ?had no problems buying 12 pairs of shoes at one time,? dropping $400 a week on shopping and entertainment on a $33,000-a-year accountant?s salary. In June 2009, she was laid off and had to take a lower-paying job, and so she started staying away from the mall and trying to reduce her $7,000-credit-card debt. But in August of this year, she got hired at a real-estate law firm, and her salary nearly doubled to $40,000. She has since gone on two vacations, to North Carolina and California, and is planning one to London for next year. She says she spends up to $300 a week on entertainment now. The shoe shopping is back, too.
It reminds me of the renewed religious fervor following the 9-11 terrorist attacks. For a few brief weeks, America as a whole was interested in God again. They sought Him in prayer. ?God bless America? became a continual refrain. But it didn?t last long.
On the positive side, Americans as a whole are saving more, but nowhere near levels needed to get our fiscal house in order. So, my question: Why should we expect our elected officials to cut government budgets when we won?t cut our own?
