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American Sociological Association: 2004 Press Release
ASA Press Releases
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Phone: (202) 247-9871
EMBARGOED: August 15, 2004
During the 2004 ASA Annual Meeting (beginning at 1:30pm on Aug. 13 through 3pm on Aug. 17), reach ASA's Press Office (415-923-7542, 415-923-7544 (fax)) at the Hilton San Francisco Hotel.
August 15, 2004
U.S. Economy Slows as Global Consumer Debt Rises
San Francisco, CA — The U.S. Presidential candidates George Bush and John Kerry promise very different economic policies. But research sociologist and consumer debt expert Robert Manning argues that the expansion of the global consumer economy will necessarily lead to the diminished economic power of the United States, including slower economic growth due to higher interest rates and excessive public and private debt burdens. Manning, a professor at Rochester Institute of Technology, finds that if the U.S. model of credit is adapted globally, it can be expected that household savings rates will plummet while credit card market penetration will continue to soar and average consumer debt will continue to rise.
In a presentation at the American Sociological Association Annual Meeting, Manning will discuss globalization and the international expansion of consumer debt. He argues that “the reconfiguration of the international ‘Neoliberal’ trade regime fueled by consumer debt—with downward pressure on wages, corporate taxes, and public services—will lead to greater economic power of regional trading blocs and the rise of U.S. capital borrowing as a major foreign policy issue.Hence, if current US economic policy is not dramatically changed, the United States faces diminished political influence and a lower overall standard of living.”
Manning’s research finds that even with record deficits and tax refunds, the U.S. economy is rapidly decelerating. Last month saw the sharpest decline in consumer spending since the recession and there has been ominous wage growth stagnation in the last year and a half along with large trade and national deficits.
Manning’s paper examines the role of globalization, as a world-historic process, in the expansion of international household consumption. He shows how the structural tendencies of the Neoliberal trade regime produce underconsumption trends that lead to increasing consumption in the developed countries while reducing wages and effective demand for exports in developing countries. His research has found that the United States cannot maintain its long-term share of global consumption, which has been falling since 2001, due to a low savings rate, modest job growth since the end of the recession, massive public-sector indebtedness, slumping wages, and falling corporate taxes.
The key question concerns how future growth in global exports will be absorbed at the systemic level. Manning’s research asks, “What is the debt capacity of Western developed countries like the United States and how long can they sustain massive levels of foreign imports?” His research examines how U.S. structural economic change, together with banking deregulation, produced an enormously successful mass marketing campaign in the late 1990s that dramatically altered American attitudes and behaviors toward consumer credit and debt. His research proceeds to examine how the European Union is responding to surplus capacity problems and low levels of household indebtedness. He concludes by considering whether the primary threat to the Neoliberal trade regime is continued industry “protectionism” or cultural resistance to Western attitudes toward credit and debt.
Manning, who frequently testifies before the U.S. Congress, will be available to answer questions about the economic policies of the two presidential candidates as well as on the larger issue of the role of the globalization of consumer debt to the dominant international trade regime at a 10:30 am media availability at the San Francisco Hilton on Monday, August 16, at the Annual Meeting of the American Sociological Association (see contact information below). (For background information, visit www.creditcardnation.com.)
Journalists are invited to attend Annual Meeting events. The ASA Annual Meeting will take place August 13-17 in San Francisco, CA. Press facilities will be located in Union Square Rooms 1 & 2 on the 4th floor of Building 3 of the Hilton San Francisco (tel. 415-923-7542). During the meeting, for more information, contact Johanna Ebner or Lee Herring (202-297-3149, cell) (email@example.com), or after the Annual Meeting at the ASA Public Information Office in Washington, DC (202-383-9005 ext. 332). During the meeting, Manning can be reached on his cellular phone at 301-237-5599 or by e-mail at firstname.lastname@example.org.
About the American Sociological Association
The American Sociological Association (www.asanet.org), founded in 1905, is a non-profit membership association dedicated to serving sociologists in their work, advancing sociology as a science and profession, and promoting the contributions to and use of sociology by society.