I have recently had conversations with people in my life about what money and class mean to them, and what an individual’s relationship to and perception of money and class means for an individual’s spending habits, philanthropic giving, etc.. To say the responses have been varied would be a understatement. These conversations have me thinking about a very complex topic: economics.
Disclaimer: Although I did achieve an “A” in both micro- and macroeconomics, I am fully aware that I have a limited understanding of the things I will discuss next and am no way an expert on the topic. Bear with me.
Back to economics. We all know that unemployment is “high” in comparison to, say, 15 years ago. I hope we all know that unemployment is always higher for minority groups. If you didn’t know that check this link. It turns out society and mainstream media don't really give a shit until the unemployment affects the “average white male.” Anyway, I digress.
Econ. Lately we’ve been fed this fallacy that the rich are job creators, and if we tax them they will stop creating jobs. As it turns out our economic system is designed so that the only thing to create jobs is demand, and the rich don’t consume 60% more just because their incomes are 60% higher. Don't believe that? Ask Stephen King. If I were a business owner (rich or not) I wouldn’t hire because my taxes were cut; I would hire when demand reached a point that made an additional employee necessary to maintain a level of customer satisfaction that would ensure continued consumption of my good or service. The way to increase demand is to empower the middle class to consume, but consumption requires money. When wages are stagnant and inflation is anything but the middle class consumes at a slower rate. All of that to make a few points: 1) The rich are not job creators just because they have more money or pay a lower tax rate and 2) We as a society teach and are taught that we will be happy when we consume. This desire to consume (and be “happy”) is what keeps our economic system alive, creates jobs, creates an upper class and middle class, and so much more.
We as humans are happy when we consume. The more that we consume the more jobs there are for the ‘middle class.’ When there are more jobs for the ‘middle class’ said class has more money. When the ‘middle class' has more money it desires to consume more.
Does consumption really make us happy? If not, how do we go about creating sustainable jobs? Hoarding money isn’t the answer, but buying a bunch of shit has never made me truly happy either. Philanthropic giving can only create so many jobs. We must be more than mice in a wheel, right?
