|Carrol Cox wrote:
> > Has anyone in those previous discussions made the point that both
> > "overconsumption" and "underconsumption" are nonsense [terms]. There is
> > only consumption, and it is merely a personal prejudice of an observer
> > that can speak of that consumption being "over" or "under." Your
> > proposition is neither correct nor incrroect. It is literal non-sense
> > (or empty).
That's bull. This suggests that "underconsumption" is merely a moral
term (and, in addition, there are no moral standards available here --
but I'll ignore that point).
In economics, the definition of "underconsumption" depends on one's
conception of how an economy works. For me, "underconsumption" is
defined in terms of the relations between sectors required to maintain
stable growth of the economy (say, as measured by real GDP) to prevent
rising unemployment. This might be defined using Marx's schemes
describing expanded reproduction in CAPITAL vol. II.
In the simplest possible terms, if consumer spending does not rise as
a percentage of GDP, it must be replaced by other, often less stable,
components of aggregate demand. That means that stagnant consumer
demand (again as a percentage of GDP) implies either increasing
instability or a growing role for government purchases in the economy
(with the private sectors falling into the sheltering arms of the
More completely, in recent decades, the US has seen stagnant wage
income (as a percentage of ...), which (all else equal) would cause
stagnant consumer demand and a stagnant economy. I call this an
"underconsumption undertow." It's an undertow (rather than a
phenomenon on the surface) because the actual path of consumption may
move out of step with wage income, due to rising consumer credit.
(This is what actually has happened.) Further, the economy can be
boosted by bubblish investment booms (as in the late 1990s) or
government deficits (as currently).
In these terms, "overconsumption" would involve consumer spending
_rising_ as a percentage of GDP, which has a different effect (likely,
squeezes on profit incomes, leading to stagnant fixed investment).
However, we might also define "overconsumption" in different
completely terms, i.e., rising consumer debt relative to assets. (In
fact, this definition jibes more with current popular usage.) In this
second sense, the "underconsumption undertow" has been largely
canceled by "overconsumption," i.e., consumers accumulating debt.
Doug's discussion and those that followed are about the _reason_ why
overconsumption of the second sort has occurred, i.e., due to rising
medical costs (due to the gross inefficiency of the private medical
sector) and the like rather than due to consumer profligacy.
> > It is obvious (if one is to use these non-sense words) that most of the
> > world's population are underconsumers of leisure. It is also obvious
> > that most of the world's population (including Americans) are
> > underconsumers of health care. But of course these propositins are as
> > empty as the cotnraries would be.
It is "obvious" (to use a nonsense word) that the meanings of "over-"
and "under-" consumption depends on the context. It is also obvious
that the meaning of (almost?) all words is based on convention.