Reverse Chic and the Fall of Empire

There’s a growing body of articles this weekend mulling over the nation’s imminent financial slowdown. And with them, some dark little metaphors.

A summary, and true enough: We spend what we don’t have; we support tax breaks instead of budget surpluses; we gobble down cheap imports from China and can’t understand why eventually the dollar starts to so dramatically weaken.

The metaphors, then: We are the next British Empire, unaware of its long-term decline. We have a viral case of imprudence that threatens to unbalance the world economy. We are little duckies fattening our livers only to be eaten ourselves.

What amazes me is the extravagance of the metaphors. I’m leaning a little toward the economic alarmism myself, this holiday season. But I do wonder what sort of effect (if any at all) these images are supposed to create. Who’s their intended audience: the center-left, the newsmagazine middle class, the Ron Paul and Chuck Norris libertarian ticket?

The best of the recent bunch:

Michael Hirsh in Newsweek

One has to wonder now whether the American superpower is also experiencing a terminal illness, with its decline marked by the dollar’s downward drift. The one difference being that there is no successor on the horizon (the Chinese have a long, long way to go), and the currency that is replacing the dollar, the euro, is backed not by an emerging superpower but by the feeble cacophony of voices that is the European Union. Yet the signs of imperial decadence are unmistakable. The world is losing confidence in the dollar, in no small part because it has lost confidence in America’s strategic judgment and in its sustainability as a great power in the face of record budget and trade deficits, which are forcing the United States to borrow ever more money from future rivals like China and Russia.

Peter Goodman’s sharp, succinct commentary in today’s New York Times on the financial trends.

The most telling passage begins with a reference to the (fiscally) invigorating pleasures of pain and ends with Americans being cheerfully force-fed by Asia (fatty liver! didn’t we read Hansel & Gretel?):

To grasp what may at first seem perverse — pain required to get back to gain — it is worth recalling the genesis of our current predicament.

A decade ago came a financial crisis in Asia. As losses rippled around the globe, credit dried up, threatening the willingness of consumers to spend and businesses to invest. With the health of the global economy menaced, central banks lowered interest rates, fueling a wave of spending that, for the most part, has kept things rolling along.

In the United States, cheap credit added momentum to the boom in technology. That story ended badly, of course, with many companies extinguished along with tens of billions of shareholder dollars. But it did not deter the American consumer, whose spending amounts to 70 percent of the American economy. The Federal Reserve again opened the taps of cheap credit. Spending went on.

As Americans have carried home mountains of goods manufactured in Japan, China and elsewhere, they have sent trillions of dollars across the Pacific to pay for them. Asian central banks have taken these winnings and parked them back in the United States, buying up Treasury bills, stocks and property. In so doing, they have kept American interest rates low and the dollar stronger, ensuring that consumers have the wherewithal to keep buying.

— Finally, against this backdrop, behold the shameful cost-cutting of the Washington elite, as observed by the wryly incredulous Ashley Parker in the Times’ Fashion section. Oh, ignominious Costco, can it really be that your five-pound pretzel bag and the desperate fashion of Pabst shall sustain us through the dark winters and cocktail parties? Are we reduced to bulk caviar?

Against the backdrop of an unpopular war, rising oil prices and a subprime mortgage crisis, a certain thriftiness seems to have crept into the city’s dining rooms.

“I don’t think anyone would dare serve caviar as a first course today, and instead of filet mignon, there are a lot of other beef dishes,” said Letitia Baldrige, the etiquette writer who was Jacqueline Kennedy’s social secretary. “Embassies don’t have the pocketbooks they used to. And to have these opulent menus for these parties here, it looks bad.”

In that sense, catering by Costco is a style statement, like drinking Pabst Blue Ribbon beer.

“Reverse chic is a very powerful phenomenon in status-oriented circles,” said David Kamp, the author of “The United States of Arugula” (Broadway, 2006), a book about the American fine-food revolution. “I think Costco is the same thing. It gets discovered.”

Reverse chic, the most powerful metaphor of all. And lo, irony shall save even the rich.

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