Going Out of Business 2008-Style.

Wickes Furniture. Levitz. Sharper Image. KB Toys. Skybus. CompUSA. Select outlets in chains such as Eddie Bauer, Ann Taylor, Lane Bryant, Fashion Bug, Gap, Foot Locker, Zales, Sprint Nextel, Wilsons Leather,Pacific Sunwear, and Home Depot. General Motors (??) The last time I Googled "going out of business sale 2008" and limited my search to the previous month, I got 1,960,000 hits. Rumors of a coming recession from three years ago have morphed into concerns about a full-on, 30's-style Depression. Besides the fact that malls nationwide are going to get increasingly desolate, the amount of jobs cut is likely to be staggering. Perhaps Walmart will take up the slack, but somehow I doubt it.

In a society with members increasingly defined by consumer "lifestyle", there are going to be a lot of lost individuals stumbling about in the coming years. It might be a good time to look for identification elsewhere. When the shit hits the fan, it's not going to matter what brand of handbag you are carrying. Forget airplane travel... if you can afford to fill your tank, you will be deemed a success- especially if you still have a job to commute to. It's time to re-establish your relationships to the simpler pleasures in life. Take your kids to the park and the library. Have a good ol' fashioned backyard barbecue. Learn to enjoy gardening. Dig a well on the periphery of your property. Install solar panels. Buy a gun and learn to use it.

Things just may get nasty this time around. People have grown up expecting material prosperity. Very few folks planned on doing worse than their parents. Our youth have been force-fed on the myths of perpetual financial growth and the promise of unfettered Capitalism. But what happens when the bulk of the population figures out that it is really a zero sum game? I hope there are some natural barriers between your neighborhood and the poorer ones. Because a significant proportion of the population is going to be severely under-prepared for the coming hardships. And they are going to be desperate, and driven by a sense that they have nothing to lose. The concept of ill-gotten goods may disappear.

Some pundits will tell you to buy gold. They will point out that the US dollar is not officially backed up by anything. For the most part this is true. The perception of value is the only thing that underscores our currency. The truth is that cheap energy (in the form of oil) has bolstered our economy for years. Foreign nations have had to keep a reserve of US dollars in order to buy oil. Now several oil-producing countries are starting to accept other currencies. Sometime during the Bush Administration the US lost its superpower status. If that weren't the case, nobody would be suggesting you invest your wealth in precious metals. What's going unsaid is that gold lacks inherent value as well. There's no reason that people should agree to consider the substance precious- besides tradition.

Food. Clean Water. Fuel. Shelter. Guns. These things will retain their value no matter what happens in the world. But perhaps we won't get to that point. Maybe this whole thing is overblown. The federal government might just tighten up and maintain basic order. However the basic assumptions within our society will inevitably have to change. For those unstinting proponents of the "free market", there's a lot of frustration coming down the pike. How long do you really expect "socialism" to be considered an evil monster by a growing underclass? Without the promise of infinite wealth, collectivism looks increasingly attractive to frustrated citizens. Taxing the rich may not remain so unpopular in the near future. We may see a "Newer Deal" within our lifetimes. Or maybe we'll cease to exist as a coherent society.

Dark Days A-Coming.

I'm not very shy about the fact that I have contempt for radio hack AM Glenn Beck. Most of what he says is tremendously easy to write off as right wing propaganda. Generally I feel that you could take the opposite of what he says, and embrace it as truth. Still there is one obsession I have that I share with this asshole- the coming collapse of the American economy. Beck is certainly not the first figure to warn of bad times ahead. Roger Waters, bassist and songwriter for the band Pink Floyd, predicted the implosion of the Western economy in the 1970's. His numbers were off, but not by much. Before the debacle of George W. Bush's administration, such concerns seemed alarmist. Now they just appear merely realistic.

So what's my response to this type of noise? How do I confront the fears of an impending depression? I mostly try to push it to the back of my mind, and prepare to enjoy the ride the best I can. After all... how long did the Great Depression of the 1930's last? A couple of decades, perhaps? Can that still happen here? Look at oil prices. Doing that very thing made me take the step of creating a personal household budget the other day. I went to fill up my foreign sedan, and noticed that prices have exceeded $3.50 per gallon. This is becoming the single biggest drain on my finances. I drive about 1600 miles a month, and the costs of refueling certainly add up quickly.

I decided that I would get a taste of the future by adding up all of my expenditures, and including gasoline at an anticipated cost of $5 per gallon. I thought that maybe my salary could absorb such a price, and still allow me to save a few bucks. When all was accounted for, I found a shortfall of about $300 per month. This reality sent my mood into an immediate tailspin. I began to realize just how close I am to the margins of insolvency. My prospective budget did include a fair amount of wiggle room. If I quit smoking cigarettes (which I really ought to do anyway), I can save about $130 a month. I can go out less on the weekends and cut another hundred out of my loss column. I could cut down on the number of iced mochas I buy every week.

But there are some expenditures that can't be negotiated. Having a kid is very expensive- more so than I had expected. Between household necessities (non-food) and stuff for regular maintenance of the baby, my wife and I are spending about $900 a month. And that number is only as low as it is because we are getting a tremendous deal on daycare. We will be paying out this money until E. is in kindergarten. Also my mortgage and car payments will remain stable. And the price of food (for which I budgeted $300) threatens to rise dramatically with the increase in oil prices. Utilities are also subject to fluctuations in the oil market. Perhaps I could get a better deal on car insurance (if I have a better driving record for a few years), but I can't count on that either.

What's especially scary is that my prospective budget does not take into account emergencies or unanticipated costs. I didn't figure in car maintenance- like inspection, oil changes and new tires. There is no accounting for clothing purchases. I didn't figure in the cost of giving gifts to family and friends. I didn't include money for replacement appliances, should something break around the house. No cash for vacation, for art materials, for art... no DVDs, music, or books. No eating out. Absolutely no luxuries. And when I look at my salary, I know that it is above average. It makes me wonder how the bulk of America is going to weather a steep economic downturn. This is going to be a very different country in the next several years. If you don't believe me, make out a budget for yourself, and see how your own life is likely to change.