The New Frugality (Time cover.)
In the Great Depression, people lined up at soup kitchens, saved string, and gathered around the hearth.
Now, in our own “Great Recession,” Americans are clipping coupons, cancelling vacations, and also struggling to make ends meet.
These are indeed tough times. 57% of Americans now say the American Dream will be harder to achieve, according to a Time magazine poll and cover story. The magazine also found new attitudes about frugality, what we value, and what we expect – even after the economy recovers.
This Hour, On Point: the new American era of thrift.
You can join the conversation. What’s your story of thrift in an era of recession? How does it echo what this country has been through before? Tell us what you think — here on this page, on Twitter, and on Facebook.
-Jane Clayson, guest host
Guests:
Joining us from New York is Nancy Gibbs, editor-at-large at TIME Magazine, and a former professor of journalism at Princeton University. Her article, “The New Frugality,” is the cover story for this week’s issue of TIME Magazine. You can see the profiles of average people the magazine interviewed — from an organic gardener to a doggie day care owner — for the new issue.
Joining us from Berkeley, California is Martha Olney, professor of economics at University of California-Berkeley. She is author of “Buy Now, Pay Later: Advertising, Credit, and Consumer Durables in the 1920s” and co-author, with Paul Krugman and Robin Wells, of “Essentials of Economics.”
More links:
Some of the sound narratives used in today’s show come courtesy of Story Corps. You can listen to hundreds of other stories at the organization’s Web site.
The San Fransisco Chronicle recently spoke with people who lived through the Great Depression and posted some video of the interviews. Frugality and its many forms have become trendy, as The New York Times noted recently. And Federal Reserve Chairman Ben Bernanke, a long-time student of the Great Depression, spoke about the connection between then and now at a recent forum.
Tags: Economic Crisis, Great Depression, personal finance, recession
The economist is incorrect when she stated that unemployment was 10% until Pearl Harbor. It had fallen below 7% by summer and was near 5% in autumn 1941.
Posted by Hanna, on April 21st, 2009 at 10:36 am EDTWhere we’ve gone wrong is to spend our discretionary money hedonistically on ourselves. Wasting money on clothes or toys doesn’t fulfill the spirit. There are better ways to spend it. We can use it constructively on schools, charities, parks etc. That way it gets spent instead of saved, but is spent for good purposes that will improve our future.
Posted by Cheryl Siedelmann, on April 21st, 2009 at 10:37 am EDTI don’t know much, but here’s something I know for sure: 6 months after a substantial recovery, people will be demanding Hummers again.
Posted by Glenn, on April 21st, 2009 at 10:46 am EDTSome of us have been living frugally for years … we’ve had no choice.
Teachers, blue collar workers (in industries which have been sagging for decades), the real middle class who haven’t been “keeping up” since the days of Ronald Reagan. Some of the things TV etc. inspired others to aspired to, mac mansions, luxurious vacations, second homes, perfect nails, SUVs, humungous screen TVs … weren’t for us.
We knew that the way financial advisers were talking/writing didn’t include “common sense”.
I am so grateful to learning a lesson from seeing my grandparents go from upper middle class to living in church subsidized housing. They had been free spenders in the 50’s and 60’s and had lived well … cabin cruiser, trips to Bermuda. No lessons from the depression for them. But I got it.
Graduating from University during the recession of the early 70’s, was another lesson in reality. Ever since I have sewn and knitted, mended tears, grown veggies, done my own house repairs, used the library, and driven second hand cars.
The upshot is that I have retired and I am not stressed out, because I always assumed that things would get bad sooner or later. It’s a mind set, and I’ve been privately proud of being frugal.
Posted by Linda Hay, on April 21st, 2009 at 10:47 am EDTThe caller who joked that he could teach a course on frugality raises an interesting point. It would be interesting to learn tips on frugality from folks who did live through depression and war. I wonder if any cities or communities are offering these types of courses?
- mike
Posted by calanan, on April 21st, 2009 at 10:52 am EDTEverything you are talking about was the whole purpose of suddenly & astronomically raising gas prices:
Downsizing by Crashing the Economy
Consolidating Businesses & Control of Economic Sectors through Preferential Bail Outs
Cutting Away the Excess
Restructuring the Labor Market through Job Availability
Just like one big corporation…
We are being whipped, herded, separated, & corralled into a massive corporate money-labor interest-milking farm that will be known as the New America of the 21st Century. It is part of the greater vision as set forth by the UN’s founders and that Bush Sr., Clinton, & Bush Jr. have in the past called the New World Order – a term which is now openly used internationally on such occasions as the recent multi-trillion dollar IMF Bail Out. Google: Prime Minister Brown.
Posted by Felipe, on April 21st, 2009 at 10:53 am EDTAnd hear it for yourself…
The New Frugality = The New World Order
Posted by Felipe, on April 21st, 2009 at 11:03 am EDTbecause we’ll never get out of debt
when inflation rises faster than wages – the only solution to which, as provided by our government, will be more debt;
this is how most everyone will eventually & slowly become enslaved
Perhaps the Great Recession will lead us to rethink of how we define success. It’s irritating to hear the constant mantra of how success equals material wealth – as if there was no other way of going about our tenure on the planet.
Thrift, conservation, and adoption of a era appropriate values is the silver lining amidst the gloom and doom. Think of this recession as a warning shot and an opportunity to learn to live with less while contributing more.
The era of believing in eternal growth and prosperity is behind us – welcome to the restraints to be visited on us by a deteriorating environment and rapidly warming planet lest we are changed indeed.
Posted by Mark - Canton Melbourne Quebec, on April 21st, 2009 at 11:28 am EDTI’m amazed that the impact of credit cards (virtual money) wasn’t brought up. I would venture that being able to buy things without actually having the money to do so is an important piece of this puzzle.
Couple that with the fact that many people are out of phase with where they should be on saving for a rainy day. People might start saving some now but it’s not going to do them a lot of good if they have jobs, nor will it help the larger economy (as was stated on the show many times). But, when times are fat again they’ll start spending and not saving (for the coming lean times) and they’ll get whacked again.
The idea is to have the resources to not only survive the lean times, but as one of the callers said, to maybe buy some stock when the prices hit the floor.
No savings, no stock buying (unless one does it on margin).
The fact that money is now an abstraction is a bit piece of this.
Posted by Richard, on April 21st, 2009 at 4:59 pm EDTI had been listening to the second half of the On Point Radio show for April 21, 2009 and began to consider the effects of the economic downturn would have on industries whose very existence is to connect consumers to products: the advertising / marketing / creative services sector.
Langston Richardson
Posted by Langston Richardson, on April 21st, 2009 at 10:19 pm EDT