Were an alien to pick up our news channels, it would conclude that human civilization depended on the production and purchase of cheap plastic rubbish. First came the concern that we might talk ourselves into not spending enough, then the fear that the banks wouldn't lend us the money to spend even if we wanted to. In November, our governments borrowed money and gave it to us in the hope that we'd catch on. Are we really so dependent on consumption?
In the short run, yes. Economists worry about a sharp fall in consumer spending, because when demand for goods falls, so does demand for labor. Our desire to spend less is quickly revealed as a desire to spend less hiring each other (and our friends in China) to make things. Result: economic collapse, unemployment, misery.
In the long run, the picture is completely different. We earn—this is a very rough average—twice what our parents did when they were our age. When today's teenagers are in their 40s, there is no reason why they shouldn't decide to enjoy their increased prosperity by working less instead of earning more. Rather than being twice as rich as their parents, they could be no richer but start their weekends on Wednesday afternoon.
If this were a gradual process, mass unemployment would not result. People would simply earn less, spend less, wear a few more secondhand clothes, and spend more time reading or going for walks.
This would be perfectly possible. We are rich enough already. Even the Chinese might cope: They already devote much of their economy to making things for each other.
Here's the big question of the season, then: Why don't we do as countless moralists urge every year and focus less on money and more on leisure (or spiritual concerns, if you must)? Why haven't we all decided to work less, spend less, and consume less?
There is an anti-consumer movement with a ready answer: We're helpless, enthralled by advertisers and hooked on shopping. I've always had a slightly more optimistic view of human autonomy.
A more convincing answer is that we work hard because income is linked to our desire for status, which is collectively insatiable, because status is largely relative. A famous survey by economists Sara Solnick and David Hemenway found that many Harvard students (although few Harvard staff members) would rather have an income of $50,000 in a world where most people were poorer than an income of $100,000 in a world where most people were richer. The survey has arguably been overinterpreted in the 10 years since it was published, but it does seem to point to an important truth: It matters to us how much money other people have.
When it comes to leisure, positional concerns seem to matter less. Perhaps that is because leisure is not closely linked to status—anyone can enjoy leisure by walking out of his job. It is hard to imagine many people preferring four weeks of annual vacation in a world where most people have less to eight weeks of vacation in a world where most people have more.
This may be part of the story. The other part is that we do have more leisure. According to economists Mark Aguiar and Erik Hurst, leisure time for women has increased by at least four hours a week since 1965. Men have done even better. That may well understate the leisure gains. A hundred years ago, many people would start working at the age of 10 or 12 and work until they died. Now it is common to spend fewer than half our years working; the rest of the time we spend studying, traveling, and in retirement.
The "work less, spend less" movement is winning. It's a shame it hasn't noticed.