>In the Florentine woolen industry of the 17th century, the wage earner was
>tied to his employer by debts and a whole set of laws was introduced in
>order to compel him to do overtime. With our culture of minimal math
>skills, many of us took on more and more consumer debt, even as the
>interest rate rose from 7 to 15% and beyond. Now in order to hold back the
>powers of compound interest, workers are finding themselves in no position
>to look for better jobs, to fight cuts or intensifications. The consumer
>debt crunch has not stabilized capitalism by propping up effective demand.
>It surely has not sacrificed savings for consumption (as Harless and
>Medoff bizzarely argue in The Indebted Society)--in order to pay off
>that debt, workers are saving ever more of their income. What the consumer
>debt crunch has done is induce the American proletariat to accept more
>social degradation; capitalism has thusly been strengthened as it always
>is by a higher rate of exploitation.
Eh?
* The voluntary quit rate in the U.S. is the highest in years; workers report jobs the easiest to find in the 20-some years the Conference Board has been asking the question as part of their consumer confidence survey.
* Consumer credit accounts for about 1/4 of the growth in consumer spending in this U.S. business cycle expansion; if that isn't a prop to demand, I don't know what it.
* The U.S. personal savings rate in 1997 was the lowest since 1939, and the rate seems to be falling further in 1998.
* I'm not sure what consumer debt crunch you're talking about, but I'd argue that VISA cards have helped stave off social degradation, or at least material degradation, not to mention a political reaction against stagnant or falling real incomes.
Doug