An article in today's New York Times notes that we may be reaching "a cultural inflection point" that marks a change from a culture dominated by credit-fueled consumerism to a culture in which, increasingly, we will be forced to pay as we go. This change is not to be unexpected, coming as it does as a form of "involuntary thrift," a combination of a shrinking of the ersatz assets in stock and housing "investments" that have fueled our sense of national wealth for the past two decades, along with the contraction of available funds for loan in our profligate and devastated fiscal institutions.
Increasingly we have passed the point at which we can choose virtue over the various vices of gluttony, avarice, envy and profligacy. It is becoming increasingly obvious that we are "stuck with virtue" because we have no choice in the matter: we are being forced by circumstance to cut back on our inclination to submit to appetite and be governed by will. I have argued here that circumstances will eventually force us to act as we should be acting by choice, but that once this has happened we will not greatly benefit from this form of enforced virtue. Indeed, it is the point when we must submit to the need of going through the motions of virtue that we will know that our vices are beginning to exact their inevitable and heavy toll. The sad truth is that our involuntary virtue comes late, and will do little to prevent us from suffering the worst consequences of our vices. While it's certainly the case that we do better to spend within our means, we have come to a pass in which - rather than benefiting from our behavior of spending within our means - we will rather experience an ongoing downward spiral of the increasing anxiety and a growing sense of poverty. Rather than having the effect of making us feel more financially sound, our enforced thrift comes in a context in which even the dollars we are able to save will only slow but not stem the grinding sense of decline.
Part of this is the self-fulfilling prophecy that our economy is driven by consumer spending - roughly two-thirds of our economic activity is consumption. As we begin to cut back our spending by necessity, we don't in fact strengthen our economy by producing goods or making things of value, but reveal the deep structural flaws of an economic system built on the quicksand of debt and fleeting and universally popping bubbles. Part of this, too, is the real decline of our power to buy things of value that we can no longer provide for ourselves, but which must be supplied by increasingly hostile nations to a captive public that has built a society that cannot be run without those substances, petroleum in particular. And part of this decline that our enforced thrift reveals is induced by the fact that we are being forced to recognize that we can no longer afford what previous generations took for granted. We are beginning to import inflation from everywhere, even as our economy stagnates and deflates, and we enter a period which combines two economic nemeses that are normally at odds with one another but will increasingly be closely linked and simultaneously destructive.
We are told that we will innovate and invest our way to new energy, new technologies that will liberate us from these economic scourges and our enforced frugality. Yet we witness almost daily in our "markets" the evaporation of our national wealth, untold billions of dollars that were only notionally ours, and are just as fancifully disappearing. Whether we will have the capacity to "invest" in the future will be dictated less by any miracles that we might create than by the hard work we will have increasingly to embrace as part of what life will be like in a very different future.
We are passing a "cultural inflection point" that will force virtue upon us: the question now becomes daily more real to us whether we will embrace virtue as something choiceworthy and which we joyously enact for the many benefits it will bear - or whether we will labor and save with pursed lips and resentment, mimicking virtue while reaping none of its rewards.