Consumer spending is failing to pick up in the US despite a slew of fiscal measures like tax cuts and increased government spending. Martin Feldstein identifies a fall in home prices and the consequent reduction in home owners’ wealth as the key factor responsible for an increase in the rate of savings, preventing sustained growth (“Why has American recovery stalled?” October 28). I would like to go one step ahead and point to the feeling of insecurity caused by the competitive spirit in those less able to compete as the culprit. The fear of failure is the obverse of the American worship of success. And the recent experience of double-dip recession only serves to exacerbate this fear in those who experienced failure or something perilously close to it. What is needed to bring back the “feel good” factor is more, not less, social security measures like Obama’s health insurance policy. Though the idea is anathema to the champions of free enterprise, the feeling of being free men and not slaves at the mercy of market forces can, at this juncture, only be fostered in the common man by a more, not less, paternalistic state.
Swagata Majumdar, Kolkata
