Spending Money In a Recession

The economic news seems more and more grim each day. The New York Times is reporting large amounts of unsold inventory. The San Francisco Chronicle attributes much of the decline in GDP to decreased consumer spending, noting that spending on so called "big-ticket items" dropped by 22.7 percent.

This is the flip-side of non-consumerism, the dirty side, that we environmentalists don't like to mention if we can avoid it. While consuming less might lead to a drop in carbon emissions, it can also lead to a loss of jobs, a decrease in the value of one's 401(k), and ultimately the loss of homes and lifestyles.

So what's an ethical consumer feeling pinched for pennies to do? Should we run up our credit cards at the nearest Target in an attempt to keep the economy afloat?

Clearly, that's not what I'm advocating.

Instead, I would argue, this is the time when it is especially important to spend your limited money at small businesses which tend to pump more money into the local economy.

Patronize your mom & pop drug store. The small hardware shop down the block. When you visit a restaurant as an occasional treat, visit the small, local business, instead of the big national chain. Instead of buying birthday presents for the kids, take them to a local theatre production.

The point is that these small businesses are incredibly susceptible to the recession. If you want them to stay alive, bypass the Targets and McDonalds and patronize small businesses instead.