Hamish McRae: Christmas isn't just about what we spend

Most of us now have enough stuff, what we don't have is the time to enjoy it
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The Independent Online

It seems to be another "good" Christmas - good, that is, in economic rather than religious or moral terms. But how we spend our money at Christmas now is very different from the ways we spent it even a decade ago, and that tells us a huge amount about our changing society.

We are, in a nutshell, spending less on goods and more on services, as we do throughout the year. But whereas goods can be stored in advance, services can't. Thus, most children's toys now come from China and were made months ago. But if you want a pre-Christmas restaurant meal or a flight out of Heathrow, the people who create that service have to do it now.

Of course, shops do still stock up for Christmas and we still buy physical presents. A few years ago, we wised up on sales and a large part of the Christmas spending season sifted to afterwards. Then the retailers realised what was happening and brought forward the sales. That applies to the online retailers too. If you go online to buy a book you get pre-Christmas discounts.

But if you want to book a smart restaurant in London before Christmas, there is no question of getting a discount. Indeed, there is no question of getting a seat, for apparently all the posh ones are booked solid. They simply cannot increase the supply to meet the demand.

So the world of goods is very different from the world of services. Only about one-third of our family spending is on goods and it falls proportionately a little bit more every year. That is partly because goods are becoming cheaper: prices in the shops are lower now than they were five years ago. That is largely because of what might be called the China syndrome. Either our goods come from lower-wage economies in East Asia and eastern Europe or the pressure from the possibility that they might is pushing down the prices of the things that are still made here.

But it is also because of changes in taste. Most of us now have enough stuff. What we don't have is the time to enjoy it. So we spend more on our leisure hours to try to improve the quality of that time.

A parallel example of this shift in the way we spend money is the retreat from DIY. That market has hardly grown in the past three or four years, despite the strong housing market and despite the overall rise in living standards.

The reason seems to be partly that if people are working harder they have less time and energy to spend on doing DIY, and partly that the supply of professionals who will do it for you has increased - the Polish carpenter or decorator. We are shifting the balance of payment towards buying the service (someone to put the shelves up) rather than spending on the goods (because shelves themselves have become cheaper).

All this might seem a reasonable response to changing economic realities and in a way it is. Insofar as Christmas is still characterised by a splurge of present-giving, you could almost say it has become a celebration of globalisation.

But there are two problems, one of which stems from the fact that most services cannot be stored. So the whole idea of our present commercial Christmas, a winter festival when people exchange gifts on a particular day, is harder to sustain.

Now you may think that a huge relief. We could get away from the over-commercialisation of Christmas and bring it back to its roots as a religious and family celebration. People would still give presents but these would increasingly take the form of something to be enjoyed over the rest of the year. If that were to happen it would be great, but getting from here to there will take time.

The other problem that becomes particularly apparent during the Christmas spending spree is the widening of differentials of both income and wealth. You don't have to be a very acute reader of the press to note that Christmas bonuses this year, for those who get them, have been the largest ever. If Christmas highlights the different ways we are spending our money it also highlights the different amounts we are earning of it.

Put the two together, the desire to buy services and the money to do so, and you get the burst of conspicuous consumption we are seeing now. It is, however, a burst of consumption that highlights the differences between us rather than bringing us together: a Christmas of greed rather than a Christmas of conviviality.

So what is to be done? Well, writing from an economic perspective, I think the first thing we should do is to reflect on the benefits that the world economy has delivered and that are so evident this festive season. This is not just the fact that children's toys are cheaper and better than ever before, though that is not a bad start.

It is also that improved communications make it possible for families to come together to an extent that would have been almost unthinkable a generation ago. We can travel much more, even if British airports are not a lot of fun this week. We can also use the new technologies to communicate electronically for a fraction of the cost even a decade ago.

If the family and communications element of the Christmas festival has been made much easier by these great global economic changes, so too have some of charitable elements. Insofar as it is for many people a time to reflect on what one might do to help others, the practical possibilities of helping directly are much greater. There are many more organisations that use the Christmas period to generate support for charitable ventures. It is not just that it is easier to give by a text message than it is to write a cheque; new communications make it easier for donors to see that, for example, more mosquito nets are going to Africa as a result of their support.

The more disturbing aspect our modern Christmas seems to me to be not so much the commercialisation of the festival - what is new there? - but the excess.

Let's not be hair-shirt about this. This is a festival of celebration, the birth of a child, and celebrations do get out of hand. But insofar as Christmas magnifies existing trends in our society, we need to think about the less attractive of these trends, and in particular those that undermine the fabric of our society.

This is not something that will be solved from the top down by politicians. Nor is it just about money. It is more about behaviour: how people might use their wealth to try to do good as well as enjoying themselves. It is about Christmas as a celebration of consumption, sure, but also about the desire to nudge the world towards a more balanced society.