We Don't Go Out to Dinner Very Often - The Limits of Common Sense
“We don’t go out to dinner very often.”
This is a phrase that most of us have heard many times from people extolling the virtues of their household budget. They may not be making that much money, but they don’t spend a lot on the luxury of eating out so they are in good fiscal shape. These statements are often made with just a bit of patronizing pride in the tone of their delivery. But, these comments miss the point, reducing spending on restaurants is actually pretty unhelpful when the larger picture of the health of the American economy is taken into account. If one cares deeply about the future of the American economy, then eating out at restaurants is one of the best things that they can do with their money. Restaurants provide jobs, lease lots of commercial real estate, and purchase lots of American made goods – from meat and grains to natural gas and furniture.
A large portion of America’s current economic troubles are caused by the nation’s very large trade deficit which was most recently valued at $53.1 Billion for the month of June. If monthly Gross Domestic Product is estimated to be $5 Trillion then the deficit is 10.6% of the American economy. This is a very large figure, and it means that Americans are exporting about 10% of their wealth every month. The large trade deficit has a negative effect on the value of the American dollar and, in turn, the American standard of living. It should be imperative for every American to reduce their demand for imported goods. As a simple illustration, the American trade deficit has been estimated to be about 50% oil and 50% cheap crap from China. If a family wants to be fiscally responsible, these are the goods that they should try to reduce spending on, not restaurant meals.
Restaurants are an important part of the economy. Restaurants employ a lot of people and most of their products – fruit, vegetables, grains, meat, and of course beer, are produced in the United States, and many locally owned restaurants also try very hard to source their products from the “local” or immediate region. Restaurants are also physical locations and can not be displaced by e-commerce and internet based businesses. The owners of the buildings where restaurants are located must continually invest in their depreciating assets and they also pay property taxes. Restaurants and small commercial property owners are also some of the most likely business people to utilize local banks and advertise in local media. All of these are positive spin off effects to a local economy from spending money at local restaurants.
As opposed to cutting household spending on restaurants, American families should instead focus on reducing their consumption of gasoline and imported consumer items from East Asia, which are usually found in discount retail stores. Spending on these items, while generally thought to be frugal, is not good for the American economy in the long term. This spending does not create many jobs, keep money in local economies, or strengthen the American dollar. American society needs to rethink the ethics of household spending. Some spending, like on restaurants, should be reconsidered as a good moral use of dollars, other spending, like that on gasoline and big box products, should be reconsidered as detrimental to our economies long term health.
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