The Fine Art of Selling Air... and How the "Economy" is MUCH Worse Than People Think

It's no news to anyone that the economy is a bit dodgy in most corners of the world. For some years, economists and commentators talked about the danger of the "real estate bubble," and aired their fears that a collapse had to come. Which, of course, it did.

TL;DR Version:
Economic systems are we know them are likely to collapse-- maybe sooner, maybe later-- because what they need to sell is increasingly based on "nothing" rather than "something." Our addiction to "growth" and "more" will eventually cause the downfall. Maybe our best chance to have a "soft landing" (economically speaking) is to embrace "enough" and stop our addiction to accumulating "more."

Selling AIR? Whatcha tawkin' about, Willis?

"Bubble."

"Air."

Whereas these airy phrases have mostly been used in the context of real property or stock markets, it strikes me that almost everybody seems to be selling air in some way, or at least trying to. 

And frankly, it annoys me... and, as fate would have it, I end up surprised at how often it annoys other people that it annoys me.

I get called a "communist" and "un-American;" sometimes people insist that I am part of what is "wrong with the system" because I actually question the system.

I've questioned the so-called "system" for a really long time. 

College Daze Predictions

Back in the early 1980's-- as a young college student at the University of Texas-- I used to get into long heated debates with my Finance professor (yes, I went to business school!) over what I perceived to be the inevitable collapses of the world's primary economic systems.

I made no bones about sharing my belief that both Iron-Curtain communism and US style capitalism were doomed to collapse, because both seemed unsustainable to me... albeit for very different reasons.

Professor Olm often ended up calling me a "closet Red" and a "socialist," and would get quite fired up during our discussions. 

The man was quite brilliant, but what always struck me as odd-- even at age 22-- was his relative inability to think in the long term. He never quite could wrap himself around my assertions that long term economics were more psychologically driven than monetarily driven... along the lines of which I argued that communism was doomed because it worshipped "the collective good" at the expense of individual recognition, while capitalism was doomed because it worshipped "the individual" at the expense of the collective good. 

He bought into the communist demise end of the equation more readily (because he was conservative and "hated commies"), but defended capitalism as this "great thing" that could never die. 

And he would get deeply offended when I insisted that-- in the very long term (100+ years) capitalism was little more than a Ponzi Scheme doomed to collapse.

History reveals that communism-- as it once existed-- only lasted another seven years, on a large scale. Capitalism, meanwhile, teeters at the edge of its life as it grows increasingly supported by nothing but AIR.

So What is "AIR," Anyway?

"Air" is many things. I'll offer up some random examples.

"Get the secret to long life, only $19.95!"

Well, actually....

For $19.95, you actually get a link to a web site that talks about how to find the secret of long life, and if you enroll in their $5,000 program you might get longer life. The $19.95 is just "air," with no value of its own.

It's like those crafts shows where they charge $6.00 admission so you can get into a building where you can spend more money. More air.

"Get rich on the Internet-- secret plan just $49.95!"

Of course, the "secret plan" isn't actually a plan, it's the process of talking others in to plopping down $49.95 of their hard earned cash for the right to persuade yet others that they can have "the plan" for just $49.95. There actually is no real thing there, just a circle jerk promise.

Many airlines charge for checked bags, now... even though luggage on airplanes is not a new concept. 

Banks charge for bank statements, and for even having bank accounts. Some banks even charge customers for counting cash.

Stock brokers charge inactivity fees AND activity fees.

Ridiculous Air

One of the most offensive cases of charging for air I have encountered in recent times was a bill from my propane provider, Ferrellgas. It was a $299.00 charge assessed because I didn't get the tank filled, during the previous year. 

WTF, over? 

The world is all concerned about rising energy costs, conserving resources, green energy, low consumption appliances and zero emissions... and you want to charge me for not using the gas you're actively encouraging me to not use? 

Needless to say, an "unpleasant" conversation with customer service followed, in which I hinted that the local ABC TV affiliate's "troubleshooters" team would have a field day with this charge. 

The charge mysteriously vanished from my subsequent statement.

Repackaging normal business practices and reselling them as bullshit?

So I got to thinking: Somehow, it has become de rigueur for businesses to charge for what once was simply considered part of "the cost of doing business." And it is just another layer of "air."

Some would argue that "air" is simply a sign of the times, and simply a matter of "repackaging" something that has always been there. United Airlines charges $50 to handle my suitcase, so I can fly to Los Angeles for "$179" instead of "$210." 

The Universal Bank of Asshats charges me $5.00 a month to send me a statement, so they can offer "interest bearing checking." 

My $19.95 garden clippers (As Seen On TV) in reality cost $4.85 to ship to me, but the "shipping and handling" charge is $11.95.

People get all whiny and cry about "The Economy." I find that if you truly poke around in the history of the economic trends that lead us to the current recession/depression, you'll find a lot of AIR. 

AIR as a hidden upcharge

Sometimes air is hidden and added to the cost of things, to make us believe it doesn't actually exist.

Investment brokers who charge a $200 fee to simply move your money from one account to another-- done with a couple of keystrokes in a fraction of a second... no actual WORK involved. 

Real estate is a particularly good place to "bury" some air. If you take a moment, you can calculate that the land+building has an intrinsic value of $200,000, and we can give the builder and realtor a "fair profit" to make it $300,000 and yet the selling price is $500,000. There's $200,000 worth of fresh air, right there!

Medical devices and procedures are another good source of air. 

I remember once talking to a sales rep for a medical supply company about the rising cost of healthcare, and he "sort of" confessed that hospitals were being charged $2000 for equipment that cost $80 to make. When I asked why such a high markup the answer was "because we CAN," with the follow up that if a patient has a choice between a permanent disability and paying $10000 for a procedure (that actually COST $1000) what do we think they'll choose?

Celebrity Air, and More...

Then there's "Celebrity Air." You know sneakers that cost $25 to make, but mysteriously get to be sold for $200 because Michael Jordan once said "these are cool." A $5 t-shirt that-- because some famous person put their name on it-- suddenly sells for $40.

"Investment Air" is perhaps a more serious problem

It seems to me that the idea behind "investment" is basically a pretty good one.

If you have some capital, you let someone with an idea use it, and you get a bit extra back in the form of "interest" when you're done. I dig that. 

But we can end up with a bit of a problem. 

The Rise of the "Investor Class"

The "investor class" is very attached to getting high returns on their investments... which is how so many public corporations end up being far more concerned with "pleasing shareholders" than "pleasing customers."

So we have this thing called "the economy," and maybe it grows at 2-3% a year, when things are going "well." But then we have these investors who expect to get a 6-7% return on their investment in these companies that operate within this thing called "the economy." 

Bit of a problem there... more AIR... the gap between the actual 3% growth rate, and the 6% cost of money. It has to come from somewhere, because it sure as $hit isn't just gonna fall out of the sky. This is part of where I ended up starting to think of the capitalist economy as a potential Ponzi Scheme... in the very long run.

Understanding this thing called "The Economy"

The talking heads (the so-called "experts" on TV and in the news) go on and on and ON about how we must "sacrifice," so we can stimulate the economy to make things go back to how they were before. Time and time again, I hear commentators here in the US say things like "Well, we don't want to become EUROPE," and "We don't want to become SWEDEN."

Having grown up in somewhat of a post-consumer society (Denmark) I find myself asking "WHY?"

And I find myself pondering why a society in which the pursuit of "enough" and "sustainability" (as representations of "happiness") is somehow less desirable than-- and seen as inferior to-- one centered around the eternal pursuit of "more."

Well, isn't MORE also BETTER? Our toxic love affair with MORE.

The only two concepts that come to my mind are "greed" and "a sense of entitlement." 

Somehow, we have been "trained" (in the US of A) that "enough" isn't "good enough." And even though we're a childless couple in our 40's, we "should" have a six-bedroom, 5,000 square foot house, and three cars. It doesn't matter whether we "need" them, we "must have" them, or we're failing at living "the good life."

The problem with perpetual growth and "more" is that we're going to eventually run out of steam (no pun intended). 

The Unsustainable World

If we project 5% growth in "stuff" out 100 years, the problem is that I am not going to suddenly have a need to own 7 cars. Or 11 toaster ovens. Or whatever else I would need to acquire in order to support the "required growth rate."

Sure, we can point to a growing population... but there's a problem. In highly industrialized nations, population growth is becoming stagnant, or even reversing. The population of Spain started declining in 2012 and other European nations are expected to follow. Japan is expected to shrink by 20 million people, by 2050. 

From where I am sitting-- and I grant you I am not an economist, nor an economic historian-- I see a very distinct parallel between the current economic issues in the US, Europe and elsewhere, and a very different historic event of only some 25 years ago. In the late 1980's, Communism got its comeuppance, as the Berlin Wall fell and a system of forced egalitarianism collapsed. 

And now? I fear rampant uncontrolled Capitalism is getting very close to having its own moment of reckoning... in part fueled by an "old guard" of asset-oriented leaders dying off and increasingly being replaced by generations of experience-oriented Millennials and beyond.

Whereas I certainly have compassion for those who have lost their jobs and their houses in foreclosure, along with their healthcare, I am very hopeful that the world-- and the US of A, in particular-- is (crossing my fingers, here) moving towards a more moderate approach to living.

I'm not suggesting anyone needs to give up the quest for a "good life." I'm just suggesting the time has come where we embrace the notion of "enough" and don't relentlessly pursue an 11th million, once we already have ten million. 

I'm also talk talking about government interference and legislation-- I'm talking about people having a voluntary epiphany and setting aside their fears of never having "enough," and embracing that we really have it pretty good.

What do YOU think? Is our desire to always "grow" (especially in the US) eventually going to cause our demise? Of you already have a good life, would you want to keep making it BIGGER? If so, why? Steemit-- in a sense-- is a "gift economy" where our actions benefit others-- do you think there are elements of that structure that can be applied in the outside world? If you were already "rich," would you be happy... or would you keep trying to get "richer?" Why? Or why not? Leave a comment-- share your experiences and feedback-- start the conversation!

(As usual, all text and images by the author, unless otherwise credited. This is original content, created expressly for Steemit)
Published 20170630 17:55 PDT