The phrase “Black Friday” has a double meaning today. It has become the description for the day after Thanksgiving, when hordes of shoppers charge to — and charge at — stores to buy Christmas presents or to find bargains for themselves. For many retailers, this day marks the point in the calendar year when their bottom lines begin tipping toward black with profit, the first time since the previous year’s Christmas season. It’s an oh-so-critical few weeks for retailers.
But in this recession era, Black Friday also invokes a darker meaning. The worst of the economic crash is probably behind us, but its memory haunts shoppers from Wall Street to Wal-Mart.
Despite the federal stimulus package, extended unemployment benefits, the cash for clunkers program and government efforts to ease access to credit, the economy remains weak. Our leaders want Americans to spend again, while at the same time they warn them to avoid the practices that led to many personal credit crises.
Sitting around the Thanksgiving table yesterday, grumpy old Uncle Harry may have lamented the passing of the good old days when Americans made things that were sold around the world.
It’s true that American products like autos and electronics no longer dominate the global marketplace as they once did. But for many decades consumer spending has represented the bulk of the gross domestic product.
The GDP has trended toward a consumer-spending reliance at a more rapid pace in recent years. Consumer spending as a percentage of GDP held steady at about 63 percent until 1980, when it began to grow. In 1990 it was 66.2 percent, in 2000 it was 68.6 percent and in the last three years it has held steady at about 70 percent.
The remainder of the economy is linked to business investment (16 percent), government spending (19 percent, a third of which is defense spending) and net exports. In the last year, the trade deficit has declined, one silver lining to the weak U.S. dollar.
It’s not time to throw in the towel on making things here. Alternative energy, such as wind, tidal and solar power, offers the very real possibility of spurring manufacturing. The hardware associated with each needs both high-tech and mechanical expertise. There is no reason those components cannot be made in Maine.
Surveys show that Americans are more inclined to save, or at least spend less recklessly, than at any time in recent history. A recent poll showed that 93 percent of Americans planned on spending less or the same amount as last year in the period between Thanksgiving and Christmas. That remains a mixed blessing: good for the long-term security of the economy, but bad for the short-term.
So as Mainers embrace the kick-off to the Christmas shopping season, it seems prudent to urge them to shop, but shop prudently. Maybe we should hope for a Gray Friday.