The case against thrift

In his book, Against Thrift: Why Consumer Culture Is Good for the Economy, the Environment, and Your Soul, Rutgers history professor James Livingston argues that it is through consumption, not investment, that our economy experiences prosperity. According to Megan McArdle:

Most of our recent woes, especially the housing bust and subsequent disaster, stem from excessive savings, driven by rising inequality. Rich savers with no particularly productive outlet for their capital create bubbles, he says, when society would be better off if ordinary people, and the government, had been given the money to spend rather than save. (Though "Against Thrift" is an argument against saving, it interestingly ends up in the same place as most arguments for it: with a call for greater government redistribution of incomes.)

I approve of this argument.