Deficits, inadequate stimulus packages, the looming threat of China may all play a part in our economic woes, but the pink elephant is consumer spending — or, more accurately, the acute lack of it.
The economic statistics are telling: The auto industry is predicted to sell 28 percent fewer vehicles in 2011. Sales of stoves and ovens are projected to be at their lowest level since 1992.
This bad news brings me back to a point I’ve raised time and again in this forum: the growing American preoccupation with leaner, more sustainable lifestyles — the challenge of doing more with less — and the role Cooperative Extension educators can play at all levels and in all disciplines in pointing the way toward these new ways of living and working.
Mind you, I’m not just talking about environmental sustainability. In these lean times, sustainability is now a term used liberally, not only to stress the need for federal and state fiscal prudence but also to foster healthier personal and family finances.
As the New York Times’s Roger Cohen argued in a column several years ago, the shock that followed the 2008 market crash put Americans into a “different mental place.”
It is small wonder why, considering in retrospect how unsustainable the old consumer mindset was. As Leonhardt observes:
In past years, many of these consumers could have relied on debt, often a home-equity line of credit or a credit card, to tide them over. Debt soared in the late 1980s, 1990s and the last decade, which allowed spending to grow faster than incomes and helped cushion every recession in that period.
Sooner or later, Leonhardt stresses, a newer, more sustainable economic model inevitably will take its place — a model that lays considerably greater emphasis on investment and production.
One thing is certain, Leonhardt stresses: “The old consumer economy is gone, and it’s not coming back.”
While house and car sales eventually will surpass their old highs following economic recovery and population increases, levels of consumer spending will not return to their old levels, he contends.
Why? Because it was driven by money that people didn’t have.
“The choice, then, is between starting to make the transition to a different economy and enduring years of stop-and-start economic malaise,” Leonhardt writes.
This hard reality presents Extension educators with a tremendous opportunity. A breach has formed within the American psyche, one that we are primed to fill.
Americans are taking their first tepid steps toward this new, considerably more sustainable model — steps that will require a rethinking of the way they conduct their lives both at work and at home.
No other public or private entity is better equipped than we are to fill the deep psychological breach that has formed during the Great Recession. Likewise, no one is better equipped to help Americans undertake the initial steps toward a new economic model.
As I see it, this presents an even bigger opportunity than demonstrating our continued relevance. It is also an opportunity to undertake a much-needed organizational transformation in the way we conceive and deliver our programs.
Are we up to the challenge?