It is the reality, though. Much of consumption is in the lower and middle class; luxury goods make up a smaller proportion of the economy, including the parts of the economy which are controlled by capitalist elites.
As consumption in the lower and middle class dips, the accumulation of wealth in the upper class does not fully replace the consumption of the lower and middle class. The supply and demand curves are vastly different for the goods being purchased and consumed by the upper class, and the elasticity of demand is much greater.
Put another way, a rich man buying a 10k bottle of whiskey every week will not replace the ~1,000 workers who cannot buy their weekly 100$ bottle of whiskey because of the increased wealth extraction from the working class. The rich man is already drinking as much whiskey, and as fine a whiskey, as he wishes to; more disposable income will not increase his consumption the way it will increase the consumption of the now-more-impoverished working class folk.
While anyone with a basic understanding of economics can realize this, the problem is actually that we’re missing the second illness hiding in the first. The system is bad, but it works when everyone plays by the rules. However, adding someone who is invested in their self interest instead of the system leads to the action we currently see. These people know what their doing, they know it’s unsustainable, but they also know that if they milk the system for what it’s worth they can make out like bandits and leave the wreckage for someone else.
The dumb, out of touch statements we hear from these people aren’t there to convince us, they’re there to convince their peers who are equally out of touch. It doesn’t matter if every gamer knows that subscription services are the killer of games, you just have to convince a dozen dumb rich people that people want it and you’ll get to gut the kingdom for everything and retire before you have to pay up.
This isn’t the reality. The spending shifts income brackets, it hasn’t gone away.
It is the reality, though. Much of consumption is in the lower and middle class; luxury goods make up a smaller proportion of the economy, including the parts of the economy which are controlled by capitalist elites.
As consumption in the lower and middle class dips, the accumulation of wealth in the upper class does not fully replace the consumption of the lower and middle class. The supply and demand curves are vastly different for the goods being purchased and consumed by the upper class, and the elasticity of demand is much greater.
Put another way, a rich man buying a 10k bottle of whiskey every week will not replace the ~1,000 workers who cannot buy their weekly 100$ bottle of whiskey because of the increased wealth extraction from the working class. The rich man is already drinking as much whiskey, and as fine a whiskey, as he wishes to; more disposable income will not increase his consumption the way it will increase the consumption of the now-more-impoverished working class folk.
While anyone with a basic understanding of economics can realize this, the problem is actually that we’re missing the second illness hiding in the first. The system is bad, but it works when everyone plays by the rules. However, adding someone who is invested in their self interest instead of the system leads to the action we currently see. These people know what their doing, they know it’s unsustainable, but they also know that if they milk the system for what it’s worth they can make out like bandits and leave the wreckage for someone else.
The dumb, out of touch statements we hear from these people aren’t there to convince us, they’re there to convince their peers who are equally out of touch. It doesn’t matter if every gamer knows that subscription services are the killer of games, you just have to convince a dozen dumb rich people that people want it and you’ll get to gut the kingdom for everything and retire before you have to pay up.
Hence investments in free products.