• Sunday, September 21, 2014

US economy thrives on wastage!

Abdul Matin

Most Americans buy food in crates and stock them for future consumption. Periodically, they discard the ones with expired dates and buy more food. During sales, they buy clothes, towels, linen, etc. which they don't need. At restaurants, they order more food than they consume and grab napkins by dozens while they need only a couple. They enjoy throwing leftovers and unused napkins into the waste bins!
A USDA study released in February 2014 reveals: “In the United States, 31% -- or 133 billion pounds—of the 430 billion pounds of the available food supply at the retail and consumer levels in 2010 went uneaten. The estimated value of this food loss was $161.6 billion using retail prices.” The amount of wastage was enough to feed the entire population of Bangladesh for more than one year!
“Why do Americans waste so much?” I put the question to a professor of economics.
“This is very simple. The American economy is based on wastage.” He replied enthusiastically and added: “Wastage increases demand. When demand increases, a chain reaction takes place. It increases production, sales and profits. When profits increase, share prices become bullish. This makes Americans very happy as most of them own shares of different companies. This encourages them to waste more for further capital gains on shares!”
Since I am not an expert on economics, I could not contest what the professor said. “Your argument is very convincing, Professor, but isn't wastage bad for the economy?” I asked naively. “Aha! That's classical economics. Americans have re-written the rules of economics to their advantage.” The professor replied confidently.
“Oh! Excuse my ignorance. What would happen to prices if demand increases?” I asked again innocently. “Prices will rise, of course, and may even exceed the purchasing power of the people.” The professor replied.
“How will the Americans then buy goods to waste?” I asked. “That's a good question.” The professor said and added: “Unfortunately, they won't be able to buy even their essential goods at that time.”
“What will happen then?” I asked impatiently. The professor took a long breath and said: “Hmm. The economy will most probably collapse.”
“Collapse!” I exclaimed and asked: “Why should the Americans do something so stupid? Do they not think about their future?”I asked again. “Now, you have come to the point,” the professor said with a broad smile on his face. “Don't you know that the Americans care very little for tomorrow? What matters to them is today.”
We ended the conversation there. I thanked the professor for giving me some of his valuable time and an insight into the US economy.

The writer is a former chief engineer of Bangladesh Atomic Energy Commission.

Published: 12:00 am Sunday, June 29, 2014

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