By Tom Kando
Today, my wife and I went shopping for a new refrigerator. We got
a miraculous twenty-four years out of
our existing refrigerator, but it’s dying.
So we drove to the usual places - stores such as Sears,
Lowe’s, Home Depot, RC Willey. These are all massive, nationwide
chain stores that sell furniture, appliances and other things. When you
enter Lowe’s, the building is so gigantic that you can’t see where it ends. The
floor is larger than a football field. Same with RC Willey.What I want to tell you about today is how things looked, while we were out shopping.
We first drove to the Galleria shopping mall. To most of the two and a half million people of the
Sacramento metropolitan area, the Galleria is probably the finest
local mall. I has about 220 upscale
stores and it was built about a decade ago.
But the Galleria is just the beginning. The growth beyond it is flabbergasting!
It is now a small fraction of the hundreds upon hundreds
of additional new businesses that stretch out to the horizon in
all directions. As we drove in search of
RC Willey, we passed acre upon acre of
new business and residential growth.
We drove through gigantic shopping areas
too fancy to be called strip malls, much more resembling veritable
shopping malls..
There were of course all the
familiar fast food chains, but also
excellent restaurants such as Pasta
Pomodoro, Chipotle and many
others. There were the giant outlets I
already mentioned, plus countless other
ones - Target, Costco, Kohl’s, Best Buy, specialty stores such as Sports
Authority, Petsmart, Petco, Barnes & Noble,
Gap, Lord & Taylor, BevMo, upscale giant grocery stores like Whole
Foods, Winco and Trader Joe’s. A dozen
Starbucks of course. Also innumerable hotels - Marriott, Courtyard, Hampton
Inn, Holiday Inn, you name it, suggesting that the area may be a shopping destination like Minneapolis’ Mall of
America.
And then, there are the vast new
residential developments - places with
names like Stanford Ranch and Sun City.
The houses look luxurious. Their sizes
probably range upward from 2700
square feet The three-car garage is becoming the norm.
This is just one of many such
areas around Sacramento. There is also Palladio,
and Town Center and Serrano, and Rancho Murieta and other ones, many of them with 16 to 20-theater multiplexes, some with their own golf courses, all built in
that festive, attractive golden Tuscan architectural style they use these
days. In the Sacramento suburbs of
Rocklin, Folsom, Roseville, Lincoln, El
Dorado Hills, Elk Grove and elsewhere,
these vast shopping, residential and
recreational areas sprung up like
mushrooms after rain - at least
until the great recession hit. And frankly, it doesn’t look like it’s
slowed down since!
I don’t get it. How is this
economically viable?
It is clear that we, Americans,
are expected to continue to consume at an insane pace. But who are the investors? Where does the
money come from for this continuing suburban explosion? Who owns these millions
of stores, shopping malls, golf courses, upscale tract houses?
Foreign investors? I suppose that’s
part of the story. According to the Wall Street Journal (June 20, 2011), foreign investment increased from $153 billion in 2009 to $228 billion in 2010 - an increase of $75
billion, or 49%. 7-Eleven is Japanese-owned, Trader Joe’s is German, Budweiser is now Belgian, Shell has always been Dutch, etc.
According to the US Department of Commerce, in 2010, the five largest
foreign investors in US companies were
Switzerland, the United Kingdom, Japan, France and Germany (in that
order). Surprisingly, China wasn’t even in the top 10, nor were any of the
filthy rich Middle-Eastern oil states.
Also, the true investment - be it
by foreign or American investors - is
primarily in the real estate, which is
then leased by the stores.
One thing is for sure: without
us little people spending money there,
the lavish malls become ghost
malls. There has got to be trickle-up,
not trickle-down.
The global economic system OVER-produces. Production is
not guided by need. It is the opposite:
consumption is promoted to match
production.
So, is everything okay this way?
Probably not. There is obviously plenty to worry about - environmentally,
economically, politically, morally. But the masses who live, shop, eat out and enjoy themselves
in these endless Disneyland-like suburbs are not millionaires. At the most,
they are upper middle class. And the restaurants are fine, the houses are
beautiful, the hotels are comfortable, and the merchandise is inexpensive. As they say, you “get value for your money.”
