New Commanding Heights
By Arnold Kling
Michael Mandel breaks down the change in consumer spending over the past year. While other categories declined, spending on education, health care, and recreation increased. Nick Schulz (who pointed this out to me) and I call these areas “the new commanding heights.” Nobel Laureate Robert Fogel sees these as the long-term growth areas for the economy.
Mandel asks why food consumption fell. I suspect that our statistics include spending in restaurants, and that when people eat out less that shows up as a drop in food consmption. Whether people reduced calorie intake will depend on whether food they eat at home has fewer calories. I suspect that on average it does.