About Nick: i am an economist based in malaysia. I write about development economics, while sneaking in a pop culture reference or two.

Thanksgiving, Black Friday and a High-Income Nation

Published in The Edge Malaysia, December 2017.

On the fourth Thursday of every November, the United States celebrates Thanksgiving Day. In my years in the United States, Thanksgiving Day was my favourite holiday. It was not just about the food, although the food plays a major part in Thanksgiving. Turkey, cranberry sauce, stuffing, mashed potatoes, apple cider – Thanksgiving is typically the biggest meal of the year. Yet, more so than just a pretty glorious feast, Thanksgiving came to represent, for me and I am sure for many others, an occasion in which to be thankful for what you have, to appreciate the people around you and to build deeper bonds with friends and family alike. It is essentially camaraderie, goodwill, gratitude and a sumptuous dinner, all packed in one.

The very next day, all of this just basically gets blown to smithereens.

The day after Thanksgiving is called Black Friday in the United States. On Black Friday, retailers rejoice as crowds and mobs of shoppers storm shopping malls, retail outlets and commercial stores, turning the year’s bottom line from red to black, and as such, giving the name “Black Friday” to the day after Thanksgiving.

The reason for this mad rush is that, on Black Friday, retailers typically provide massive discounts – even up to 90% - on goods making them too cheap to ignore, relative to their original prices. These goods range from simple calculators to clothes to Playstation consoles to even a 50-inch plasma television costing only USD799. Shoppers tend to queue not for hours, but for days. Some are incredibly prepared, showing up with tents, ice coolers, generators, televisions and everything they would need to brave the three, typically cold, nights that they would be camping outside the stores.

And on Black Friday itself, some of the stories are terrifying. If you have the time, and indeed the stomach, just search for “Black Friday mob” on Youtube. You will see people fist-fighting, trampling over one another as they stampede into stores, grabbing things out of other shoppers’ hands. Some stories are even more insane – in 2011, a woman in Southern California turned herself in to authorities, having pepper sprayed video-game shoppers in a Walmart on Black Friday. An 80 year old woman tackled and then bear-maced another woman over fleece fabric. Two elderly women raced, gladiator style, when they found out that there was only one USD5 calculator left in the store (normal retail price: USD10).

This all sounds totally warped. A collective nationwide day of total gratitude and camaraderie, followed by a collective nationwide day of total materialism and extreme Darwinist survival-of-the-fittest battle royale. I don’t think it is possible to find starker representations of the human condition than Thanksgiving and Black Friday, which take place every year over two November days. At the very least, Alibaba’s November 11 “Singles Day” sales, which recently saw total sales of over USD25 billion, does not follow from a national day of gratitude.

In Malaysia, Black Friday has also become an event of sorts. On the 24th of November, storewide Black Friday sales were held across the country, with Malaysians swarming these stores to grab heavily discounted – some up to 70% – goods. Of course, the frenzy does not match the bloodlust of the American Black Friday gladiator matches, but it may one day if more stores latch on to Black Friday and even bigger discounts are given. Who is going to resist, for instance, a Samsung Galaxy S8 note for RM1,500 instead of the RM3,200 that it currently retails for?

Going back to the United States, when the Black Friday stampedes are placed side-by-side with Thanksgiving Day, I cannot help but ask, “What is the point of having a day just to give thanks for what you currently have if the ugliest side of materialism is going to show itself the very next day?” It seems bizarre to me – of course, one could say that those who celebrate Thanksgiving and those who go for the Black Friday gladiator matches are totally different groups, but this is a stretch. It also seems, to me, to totally miss the point of what’s important; is a USD5 savings on a calculator worth fighting with others for? Or, to take it another way, is a heavily discounted Playstation 4 worth getting bear maced for? Some people may think so, I do not share those sentiments.

And perhaps I do not share those sentiments because I can afford to buy a USD10 calculator and not have to fight it out to save USD5. Perhaps some of those shoppers at Black Friday sales can only really stock up on clothes, diapers, and food for their children during Black Friday sales. Perhaps only on Black Friday can consumers actually purchase necessary home appliances for their homes. It can be difficult to distinguish between real need and absurd materialism.

Similarly, this line between real need and absurd materialism needs to also be drawn when we think of Malaysia’s goal to be a high-income nation, achievable by early next year according to some sources. It sounds great, of course, just like a USD799 50-inch plasma television sounds great, but we need to dig deeper. As the Malay saying goes, indah khabar daripada rupa. What is the point of being a high-income nation if, as a recent Merdeka Center survey reported, 15% of Malaysians skip meals to make ends meet, and 27% do not have RM500 for an emergency?

Becoming a high-income nation will tell us something about our economy, but not much. It says that, on average, an individual Malaysian has an annual income akin to that of a high-income economy. However, that is the problem with averages – ten people making RM50,000 have the same average income as one person making RM499,991 and nine people making RM1. It may feel great to be that one person making RM499,991 but there is a 90% chance that a given person makes just RM1. Therefore, when it comes to this notion of a high-income economy, I would urge that Malaysians hold ourselves to a higher standard than that, and if people tell us that it is great that Malaysia is now a high-income nation, we say, “Okay, great, but so what?” Having a high-income nation status is a bit like buying that USD799 50-inch plasma on Black Friday, but it is rather meaningless if you had to stampede through people and bear mace others just to get it.

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