Virginia Postrel argues that our accumulation of stuff is easing the pain of the recession:
In today’s sour economy, however, what once seemed like waste is starting to look like wealth: assets to draw on when times get tough (and not just because of all those ads promising top dollar for your gold jewelry). Material abundance, it turns out, produces economic resilience. Even if today’s recession approached Great Depression levels of unemployment, the hardship wouldn’t be as severe, because today’s consumers aren’t living as close to the edge.
Take clothes. In 2008, Americans owned an average of 92 items of clothing, not counting underwear, bras and pajamas, according to Cotton Inc.’s Lifestyle Monitor survey, which includes consumers, age 13 to 70. The typical wardrobe contained, among other garments, 16 T-shirts, 12 casual shirts, seven dress shirts, seven pairs of jeans, five pairs of casual slacks, four pairs of dress pants, and two suits—a clothing cornucopia.
Then the economy crashed. Consumers drew down their inventories instead of replacing clothes that wore out or no longer fit. In the 2009 survey, the average wardrobe had shrunk—to a still-abundant 88 items. We may not be shopping like we used to, but we aren’t exactly going threadbare. Bad news for customer-hungry retailers, and perhaps for economic recovery, is good news for our standard of living.
It’s a fair point. There’s something to be said for the idea that a rising tide lifts all boats. Even in a society with lots of inequality, it’s better to be poor in a wealthy society than in a poor one. And there is an argument to be made that the whole notion that it is “better” to spend one’s excess income on memories rather than things doesn’t runs headlong into this problem. At least if you spend the money on shoes, the shoes will be around when you lose your job while the trip to Italy won’t.
But the more I think about it, the more wary I am of buying into the notion that the accumulation of stuff is a virtue in itself. To take Postrel’s shoes example, yeah it’s nice that you have these shoes so you don’t need to buy them later. Forgive me for making the perfect the enemy of the good, however. If she had simply bought six pairs of shoes and saved the rest, she would have the money for an additional pair of shoes or two and then have some extra money to, I don’t know, eat and stuff.
The hardest part about being unemployed is not the sporadic expenses. You can often timeshift and downsize those. When I am unemployed and need to get some clothes, I can go to the thrift store. Or Walmart. Or I can decide that my older clothes will do just fine after all until I get a new job. I can’t unpurchase the stuff I’ve already got. And rent needs to be paid. I can move to a cheaper place, but even that is going to require a fair amount of money - particularly if I have a lot of stuff.
The thinking involved in this is awfully tempting, though. I’ve found myself, when about to be unemployed, thinking along similar lines. If I buy a laptop now, it will last me through the unemployment! See, it’s not a dumb purchase to make after all. Sometimes I even give into this logic, but I am rarely proud of myself afterward.
I say this as someone that does have an excess of stuff. My wardrobe is actually bigger than my wife’s. In my own defense, part of it is a preference for quantity over quality. I don’t buy high-end laptops, so I can have more of them. I don’t buy nice clothes, so I can go three weeks without doing laundry by virtue of having more cheap stuff. But it’s hard to say that I would not have been in a better financial position if I simply went with one or two weeks worth of clothes and a single laptop. This is when I say that we shouldn’t make the perfect the enemy of the good, undermining my previous argument a bit.
Cars are another issue where this comes up. Part of me is sympathetic to buying a new or late-model used car on the basis that if I buy it and if we high-tail it out of Callie to somewhere else in three years, at least then I won’t have to worry about replacing the car at that point. Logically, though, I can buy an old used car, save the money, and replace the engine or transmission down the road if required and the chances are better than not that we will still end up ahead financially*. If we go with a newer car, it will be because we want a newer car and the features and intermediate reliability that comes with it. From a purely financial perspective, it’s hard to make a very strong case for it.
* - I’ve done the math on this. Essentially, we get a car that’s 6 or 7 years old, we end up ahead even if we have to replace the engine or the transmission. If we have to replace both we end up slightly behind… but we will be driving a car with a new engine and transmission and a shelf-life that’s going to last longer than if we buy a new car today.