The economy needs shoppers

I heard "what we need is customers" several years ago from a local business owner interviewed on the news. He had everything he needed to run his business - the store, the merchandise, the employees. Everything except customers. He had survived the crash of 2007-2008 and was holding his own for the moment. But for how long?



People should never have run up high credit card debt in the first place, and those who can do so are wise to pay it down. In the short term that will not help retailers, but in the long run it will help them as people waste less on interest and have more to spend.

If you don't have the money to pay for something, then don't buy it. Remember how people used to "save up" for things? Molly and I use credit cards all the time, but when the bills come at the end of the month they get paid in full and they get paid promptly.

The reference to credit cards didn't mean people weren't using them. It meant that people are paying down debt rather than buying new things - as you said, "the economy is going without consumers."

To pay your credit card bill every month, regardless of how large or small your income may be, you need to live within your means. As I put it above, if you can’t pay for it, then don’t buy it.

Now, obviously, people may suddenly find themselves without any income, or may have large unanticipated expenses. Then you do what you have to do to survive, and running up your debt may be your only option. Emergencies aside, you need to stay out of debt and save money if you possibly can. There are exceptions, of course, like a mortgage on a house or a loan for a major item like a car.

Spending, which keeps the economy going, does include groceries and household goods. But deficit financing of day-to-day expenses is a really bad idea.



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Minimum wage has not kept up with inflation. People at the bottom are effectively making less than they were making decades ago. People in the middle may be holding their own, but there seem to be fewer of them every month. “The rich get richer and the poor get poorer.” How anyone can believe the economy can survive over the long term when large numbers of people are experiencing a declining standard of living, or do not even make a living wage, is incomprehensible to me.

U.S. Department of Labor – Minimum Wage Chart
www.dol.gov/whd/minwage/chart.htm
Federal Minimum Wage in 1974 = $2.00
Federal Minimum Wage since 2009 = $7.25

U.S. Department of Labor – Bureau of Labor Statistics – Inflation Calculator
www.bls.gov/data/inflation_calculator.htm
$2.00 in 1974 is equivalent to $9.48 in 2013

Dollar Times inflation calculator
www.dollartimes.com/calculators/inflation.htm
$2.00 in 1974 is equivalent to $9.94 in 2013

There are those who think the official inflation figures are kept artificially low – much lower than the real figures – by changes in how they are calculated.
www.shadowstats.com/article/no-438-public-comment-on-inflation-measurement

A start might be to kick the minimum wage up to $10 with annual adjustments for inflation (even at the allegedly unrealistically low official rate).

It's not that wages are too low, it is that prices are too high.