Like many of you, I have lived and worked through the economic stagflation of the 1970s and the recessions of the early 1980s, 1990s and the oughts. We’ve seen the Dow plunge, unemployment rise, bankruptcies flourish and GNP sag. But this time, for me at least, the speed, breadth, depth and reasons behind this particular economic debacle have made it much more, shall we say, engaging.
I’m not saying it’s happening yet, but there’s nothing like an imminent global economic collapse to remind us of how powerless we are as individuals. In aggregate, we dominate the world, but we remain pretty pathetic little hunks of meat when we perceive our personal livelihoods as threatened in ways over which we have no control.
Our instincts are to curl up around what we have, hoard it and protect it for the benefit of our immediate families – those closest to us and dearest to our hearts. It’s a fine instinct for surviving a drought or famine, where food or water is scarce. There’s only so much to go around and once it’s gone, it’s gone. No need to help the weak — better that the fittest survive to ensure continuity of the species.
But those instincts have no place in our industrialized society, where the very definition of “survival” has come to mean plenty of gas in the tanks of cars to drive on smooth roads among well-stocked supermarkets, centrally heated homes and workplaces, where our efforts are appreciated and rewarded with riches beyond the imagination of anyone who battles the elements for subsistence.
If we want to survive this recession, it means emerging not just alive, but with a support system of suppliers, service providers, distributors and OEMs with the resources and personnel we need to flourish in the vacuum created by our less wise, failed former competitors.
Projects and plans that made sense before the banks ran aground are still likely to be solid winners as soon as things pick up. During the past few weeks we’ve spoken with leaders of many major manufacturers who understand this and don’t intend to curtail the investments they planned for improving their products, efficiency, growth potential and competitiveness.
Personally, I’d be foolish to stop my home remodeling projects designed to improve energy efficiency, or suspend my investments in raising and educating my children, or run my car on worn-out tires just because my retirement account has tanked.
Simply put, those of us who are still solvent must not stop spending, even if we easily could. Instead, we must disburse our funds carefully, with an eye to how our investments will support our fellows and the economy we want so much to turn back in the right direction.
For me, that means an emphasis on services, because dollars spent there are likely to help the most people. Next come locally produced goods and those with significant labor content, then the businesses whose failures I believe would be the greatest losses to me and my community. I put a higher value on domestic goods, but I also plan to buy imports that are the strengths of their countries of origin and don’t compete with local products.
Think about how your dollars not only can make their way locally from your wallet to your local suppliers, their employees, the market and back to you by being used to buy your company’s products, but also can go around the world, help many people, and then come back to you.
It’s also a good time to remember the local food banks and charities that will allow those who have lost their jobs to remain in the community so they will be available to help you when times turn better.
I see it as extending my family in this time of need. Instead of focusing just on myself and blood relations, I need to consider how every expenditure can do the most to help others weather the economic storm and, in turn, feel confident enough to do the same for their extended families.
From where I’m sitting, it looks like the best way out.
E-mail Editor in Chief Paul Studebaker at email@example.com.