Some years ago the concept of peak oil captured the imagination. The world would start to find less and less of the black gold; supplies would dry up; prices would rise and we'd all have turbines in our gardens or on our roof to supply the power we'd so desperately need. It never happened. New technology delivered new sources of oil (think horizontal drilling, Canadian oil sands, subsalt layer finds off Brazil and of course shale oil, which has returned the US to vying for the trophy of the largest oil producer in the world). The market delivered a solution...at least for now.
So what about a new thought that has been emerging? That the developed world is now approaching peak stuff? This is the intriguing concept that perhaps one of the reasons, maybe the reason, for the slow pace of economic growth is the saturation of the western consumer with consumerism. Maybe we've just got enough stuff?
After all, the rise of self-storage is a symptom of our collective mania. We spend money to rent space, to put stuff into storage that we don't use in order to free up space in our homes to buy more stuff that, guess what, we don't use. Tyler Durden, the lead character in the film Fight Club put it neatly, if a little crudely. 'We're all doing jobs we hate to buy stuff we don't need' (except Tyler didn’t use the word stuff, but you can work it out).
Economists, rational as they are, don't like this theory. All their training stems from the premise that we always want more. Faltering growth is simply a story of too much debt, a lack of confidence stifling our urge to spend (as consumers), or invest (as businesses), and illiterate fiscal policy. We are failing to take a once in a lifetime (once in many lifetimes) opportunity to invest in our infrastructure with the free money that negative or near negative sovereign yields offer.
Well maybe that's right. But maybe there is also a story here of economic stagnation brought on consumers by simply having enough of what they need? No? You don't buy (sorry, believe) it? Consider this little snippet...
A few months ago the Office for National Statistics released the remarkable news that the average person in the UK used just over 10 tonnes of material in 2013 (it’s most recent data) compared to 15 tonnes in 2001. Remarkable in many ways. I suspect your first reaction was a bit like mine. ’Well, I don't use 10 tonnes.’ But this data includes all biomass (crops, livestock feed, livestock), coal, oil, gas, metal and construction materials etc. If you can get your head around the fact that you, Mr or Mrs Average, uses 10 tonnes of materials a year, then start to think about the decrease since 2001.You use a third less material now than you did then.
At first this seems an incredible reduction but let’s start to think about it. We use renewable fuels more than we used to. Our domestic appliances use less metal than they used to. We no longer buy video recorders, CRT TV's (it took two burly guys to get rid of mine a few years ago) or hi-fi. That little slab of glass and metal in your pocket or bag right now contains our libraries, our music collections, our hi-fi (especially blue-toothed to a little speaker), our photo albums, our address books, our diaries, our toys, our games, our consoles, our fitness monitors, our TV. Oh, and it’s a phone.
It goes wider. The plethora of car manufactures desperate to get into bed with the car sharing economy is because of a fear that the next generation will look on a personal hunk of expensive to buy, depreciating and costly to run metal that sits idle 97 per cent of the time as some kind of crazy delusion that their elders suffered from. Those rows and rows of empty black cabs waiting forlornly outside mainline train stations across London now are a testament to our new more efficient ways of using resources. I don't have the details but I'm pretty sure in terms of time on the road taking passengers, an Uber car is utilised more heavily than a black cab.
We're all trained now to reduce, reuse, recycle. Admit it. When asked if you'd like a bag with that, you suffer a little shiver of guilt if you say yes.
So if as a result of all this progress we're buying less stuff, what does this mean for our economic development? Well it doesn't mean our economy stops. We're still consuming but we're consuming experiences, places, services, did you know for example there is a business called Puppy Poop Pick-up? Much of our consumption is now digital (music, news, books, movies, TV and games); much else is travel, entertainment, communication etc. Polls of the patronisingly termed millennial generation consistently point towards stuff being less important than before; 26 per cent of household spending was on physical goods a decade ago; today that is 21 per cent.
Perhaps I wonder, is our economy really growing more slowly after all? Is this simply a question of measurement? Measuring stuff is (relatively) easy. Measuring services, experiences, the quality of our taxi journey, our reading or music enjoyment in its new forms, is a little more tricky. Maybe peak stuff is a factor in our stagnant economic data but maybe only through the failure of how we count progress.
Maybe we need more accountants?
The boss will like that one.