On Wed, Feb 4, 2009 at 1:38 PM, Charles Brown <[email protected]> wrote: > CB: This is a good question David, and actually I have been > thinking about it from discussions elsewhere on this. > > I believe the answer is sort of right there in front of us. > Not being able > to afford something is the same as poverty or restricted > consumption relative to the something you want to buy. The > credit papered over this fact for a while.
Charles, I think it is necessary to make a distinction here that is very important: a certain kind of consumerist over-consumption is entirely consistent with and can co-exist with under-consumption in the same society (maybe even the same family?). Suppose a homeless person takes out a no-doc mortgage on a small 2 room apartment so that he can put a roof over his head; or an unemployed person taking out a home equity loan to pay for medical bills because of no health insurance. I don't think David would characterize these as over-consumption; indeed these are examples of *under-consumption*, where people are unable to obtain basic necessities of life. On the other hand, suppose a middle income family takes out a home-equity loan to buy a large flat-screen plasma TV, or uses a credit card to pay for an SUV. That *is* overconsumption. Which type of consumption was predominant during the recent housing bubble is an empirical question. The media likes to portray the stereo-type of people taking home equity loans to buy expensive consumer goods, but is that accurate? Or is it just more PR like the infamous welfare queen driving a Cadillac? -raghu. -- In Soviet Russia, the television watches YOU! _______________________________________________ pen-l mailing list [email protected] https://lists.csuchico.edu/mailman/listinfo/pen-l
