Black Friday 2011 Turns Freaky for Economists, Politicians: View

Happy Black Friday! That’s the name the financial world has given to the day after Thanksgiving, which marks the opening of buying season. A fifth of all consumer purchases this year will be made between Thanksgiving and Christmas.

These weeks may be thought of as the Western answer to Ramadan, which is for Muslims a monthlong period of self-denial, reflection and prayer. For Christians and Jews and Muslims in the U.S., the next few weeks will be a period of self-indulgence and heedless consumerism. Some find the traditions of this holy period -- particularly shopping -- offensive and exhausting, but we should honor the indigenous culture of the West, of which Christmas shopping is a deeply ingrained part.

Black Friday is similar to another important Western holiday, Groundhog Day. The difference is that instead of a rodent emerging from the ground, taking a sniff and determining whether there will be six more weeks of winter, you’ve got economists and demographers going to the mall, taking a sniff and determining whether there will be six more months of recession.

Black Friday 2011 is especially fraught for several reasons. First, the future is more uncertain than usual. We don’t know whether we’re emerging from the deepest recession since the Great Depression or about to plunge into a “double dip.” Second, the 2012 elections are approaching, and both the White House and the Senate, now in Democratic hands, are very much up for grabs. Historically, the state of the economy is the most important factor in determining the winner of the presidency.

Third, it’s not even clear what we should be hoping for in the Black Friday sales figures, when they start pouring out tomorrow. Our every instinct is to hope for brisk sales and record highs, signs of what’s charmingly called “consumer confidence.” The consumer has been the engine of past prosperity, and consumption has always played a large role in America’s particular style of the pursuit of happiness. Economic recovery depends on whether the consumer has got his or her confidence back. Some fear that we are losing our taste for things -- that the recession may have taught us what we don’t really need. Others, of course, applaud this same development.

So should we hope for big numbers today? Should we, perhaps, even do our own bit by ducking out of work early and heading to Costco? That depends not only on whom you talk to, but also what kind of mood they’re in.

Ask a Democrat -- a traditional, liberal Keynesian -- and she will probably say, “By all means step up and buy. We’re still recovering from a severe recession and the more stimulus the better.” More customers buying more stuff means more jobs in retail and throughout the economy. On the other hand, liberals are more likely to take aesthetic or even moral offense at the orgy of consumerism that occupies the U.S. during the month of December. Many of them read John Kenneth Galbraith’s “The Affluent Society” in college and believe that we should spend our money on social necessities like infrastructure repair, rather than consumer gewgaws like a Blu-ray player.

Ask a Republican -- a modern, tax-cuts-all-the-time conservative -- and he will say, “Hell, yes -- it’s your money. Spend it before the government takes it away from you.” On the other hand, Republicans don’t believe in the need for a Keynesian stimulus -- or apparently they don’t, or they wouldn’t be putting deficit reduction at the top of their (and the nation’s) agenda. They do believe that what caused the recession was over-easy credit, and can’t be completely happy to see all that plastic being waved around again.

In the middle somewhere are mainstream economists, who believe that we need more stimulus for a while to make sure the economy recovers, and then -- at some unspecified later date, well after Black Friday 2011 -- we need to reverse course and cut both public and private spending in order to reduce the national debt. The notion that Americans could ever perform such a U-turn from extravagance to frugality explains why they are economists and not political scientists.

Looming over all of this, of course, is the Internet, which is eroding the predictive significance of Black Friday by allowing people to start shopping the day before -- Thanksgiving itself -- and to continue shopping online until Christmas and beyond without even getting near the mall.

Best holiday wishes, and happy Black Friday in particular, from us at Bloomberg View to all of our readers.


To contact the senior editor responsible for Bloomberg View’s editorials: David Shipley at davidshipley@bloomberg.net.