Death Tax on Stuff

The Obsolescing of Planned Obsolescence Economies

In an effort to stem the frugality of the populace during the Great Depression, Bernard London wrote a compelling piece on “Ending the Depression Through Planned Obsolescence.” His thesis ran something like this… if the public doesn’t spend, the economy can’t recover… therefore, we need the public to spend more… therefore we must punish a person who possesses or uses a product longer than its statistical life and actually begin to tax continued use after depreciation had run its course. This concept and phrase – coined in 1932 – was popularized by the great Industrial Design engineer Brooks Stevens who, in 1954, claimed to have coined the term. A tiny irony captured by the fortunate documentary work of my dear friend Chip Duncan (www.duncanentertainment.com) who had the foresight to interview Stevens before his death.

Brooks Stevens (and his ignored muse Bernard London) lived in a time when two consequences of his admonitions were either unconsidered or relegated to infinite improbability. Both men failed to realize that, in promoting a public good where consumers seek something “a little newer, a little better, a little sooner than is necessary,” the drain on natural resources and energy must be viewed as relatively infinite and of nominal cost. Further, they failed to acknowledge the axiomatic imperative that consumers actually purchase with wages, not credit. The ignorance of both of these implicit assumptions has portended the end of their reign of indifferent, immoral consumerism. In Duncan’s interview, Stevens makes the statement that no company would be so “diabolical” to actually create cheap or inferior products to pass along to customers so that they would have to constantly buy more stuff. Does anyone see an irony in the fact that Stevens made this assumption around the same time as a little retailer of cheap stuff was getting off the ground in an anonymous corner of America – Bentonville Arkansas?

On July 9, 2009, the last of my Phase I forecasts for the collapse of the current economic system came into sharp focus. The realization that credit card debt – the cloaked specter that has been luring the public and politicians alike to try to solve a faux “real estate” crisis – has finally hit the collective consciousness. Congratulations – it only took a few years from my Arlington Institute “House of Cards” speech to discover what has been known and reported since the late 1990’s. U.S. banks are acknowledging that they stand on the precipice of massive consumer credit default exposures just in time for the summer holidays. And, at the same time, the People’s Bank of China lent almost 25% of the country’s GDP in new credit issuance within China fueling a gross domestic product growth which could top 8 percent this year. The difference between Chinese borrowing and U.S. borrowing is that the U.S. debt was actually being purchased by international interests – the Chinese debt is being recycled into their economy. China, the producer of last resort for the London Stevens Maelstrom of consumption, is now inverting its economy having built manufacturing and energy infrastructure financed by the excesses of the West. They have optioned energy, agriculture, water, and other resources from Tonga to Timbuktu and have out-maneuvered the U.S. and Europe at every turn. And now, they are ready to make their next bold move…

What if their friend and gold miner extraordinaire Robert Friedland suggests that, with China’s abundance of gold reserves and mineral reserves, it adopts an actual or synthetic gold standard to back the Renminbi? Could the Asian Century that Friedland has forecast have it’s auspicious beginning this year and has the Bretton Woods dollar denominated consumerism just met its phantasmal end in accordance with the London Stevens Maelstrom? Watch Ivanhoe Mines and ask yourself, what if….?


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