By Rick Claypool
As the smiling pundits chatter incessantly to maximize participation in the traditional post-Thanksgiving festival of mass consumption this year, Black Friday is emerging this year with exaggerated significance for those who equate the health of Wall Street with the health of America’s economy.
USA Today’sWall Street-centric story today about Black Friday begins, “How frequently cash registers scream ka-ching on Black Friday and the rest of the holiday shopping season could determine if investors will continue to see profits in their stock portfolios.”
So let me get this straight. One year after the financial sector took our economy to the brink of collapse, we’re rooting for Wall Street’s success, which depends on the willingness of consumers to spend as much as they can – most likely more than they can afford, since that’s how the financial sector makes its money – during the worst economy in 26 years and while 10.2 percent are unemployed? Sounds like some seriously misplaced priorities.
USA Today continues: “This year Black Friday (and holiday) sales will have a little extra meaning,” says Timothy Vick, a portfolio manager at Sanibel Captiva Trust [note: and Warren Buffet apostle]. […] Without a rebound in consumer spending, Vick says, it will be harder to sustain economic growth and the budding recovery in corporate earnings.
Of course! How could we forget? Growing corporate wealth = climbing stock value = recovery, right? Economist Dean Baker sarcastically describes this economic climate following the recent growth of financial industry profits while unemployment continues to rise: “Everything is bright and sunny again, unless you have to work for a living.” In other words, unless you’re a corporation, don’t get too excited about the corporate recovery (and click here to stand up to increased corporate power in our elections).
What we need are strong reforms to rein in Wall Street so that financial sector’s risky wagers with taxpayer money and inevitable failures don’t destroy the livelihoods of working people. That means breaking up the “too big to fail” banks so when one topples, it doesn’t take the rest of the economy with it; creating a Consumer Financial Protection Agency to end predatory lending practices; and imposing a windfall tax on the $140 billion in bonuses and compensation that Wall Street firms aim to pay this year to encourage caution and help the government pay for the damage they caused.
The financial reform package recently put forward by Sen. Chris Dodd (D-Ct.) would do much to move us toward these significant reforms. Take action to tell your senators to support this bill. And if you’re looking for a different way to mark Black Friday, consider observing it like the folks at AdBusters: they call it “Buy Nothing Day,” and instead of taking their lives into their own hands in the mob at Wal-Mart, they do exactly what it sounds like they do. But no matter how you mark it, have a safe and happy holiday.