Black Friday: Keeping Up with the Joneses

Spend more, join the Joneses on Forclosure Row.

Today is supposed to be the biggest shopping day of the year.  Let’s not forget what the phrase “keeping up with the Joneses” means and its ramifications.  For this we turn to Wikipedia:

The philosophy of “keeping up with the Joneses” has widespread effects on society. According to this philosophy, conspicuous consumption occurs when households care about their standard of living in relation to their societal peers.

According to Roger Mason, “the demand for status goods, fueled by conspicuous consumption, has diverted many resources away from investment in the manufacture of more material goods and services in order to satisfy consumer preoccupations with their relative social standing and prestige.”

Social status once depended on one’s family name; however, the rise of consumerism in the United States gave rise to social mobility. With the increasing availability of goods, people became more inclined to define themselves by what they possessed and the subtle quest for higher status accelerated. Conspicuous consumption and materialism have been an insatiable juggernaut ever since.  The desire to increase one’s position in the social hierarchy is responsible for much of the social mobility in America. The upward mobility over the past few decades in America is due in part to the large number of women joining the labor force. U.S. women have slowly and steadily increased their participation in the labor force from 46 percent of all women (age 16+) in 1974 to almost 60 percent in 2004.

In addition, the number of college graduates are at an all time high. Between 1995 and 2005, the number of full time college students increased by 33 percent. College enrollment hit a projected record level of 18 million in 2007. Between 2007 and 2016, enrollment is expected to increase by 14 percent.  With more people receiving higher levels of education, and more women entering the labor force, the upward mobility in America continues to climb; however, right alongside it has risen the degree to which these people want to consume things which will keep them at the same level in the social hierarchy as their peers.

One area in which “living above one’s means” has caused negative social effects is that of credit card usage. In the first quarter of 2002, total credit debt was $660 billion. By 2005, the total credit card debt had increased to $735 billion.  Americas’ average credit card debt in 2007 was $8400 per household. By the end of 2007, consumer debt in America had risen to $2.5 trillion.  According to the Federal Reserve, over 40% of households spend more than they earn.

Before you buy it… do you really need it?  The same thing applies to our Federal Government, too.

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