- The U.S. has recently seen consistent economic growth that has been fueled by strong consumer spending from average Americans.
- To sustain this level of consumer spending, Americans are draining their savings, spending more than they are bringing in as their wages stay stagnant or decline, according to experts who spoke to the Daily Caller News Foundation.
- “The high probability of recession in the near term is very troubling when coupled with the decline in savings,” E.J. Antoni, a research fellow at the Heritage Foundation’s Grover M. Hermann Center for the Federal Budget, told the DCNF. “People need more savings today than ever to cope with the higher cost of living, and instead, many families are headed into the next recession with less savings and more debt.”
(Daily Caller)—Under President Joe Biden, economic growth has been partly sustained by Americans spending through their savings on everyday goods, according to experts who spoke to the Daily Caller News Foundation.
Gross Domestic Product (GDP), a measure of economic growth, has remained persistently high, coming in at 2.1% for the second quarter of 2023, even as the Federal Reserve has attempted to tame growth through hikes of its federal funds rate. The main contributor to U.S. GDP is consumer spending, which has managed to notch consistent increases at the expense of the savings of average Americans, experts told the DCNF.
“Consumption is about 70 percent of GDP growth, so naturally any additional consumption by households and businesses is going to add to GDP,” Ryan Ellis, president of the Center for a Free Economy, told the DCNF. “But to the extent that consumption is fueled by one time windfalls from the government, it’s basically bringing future consumption into the present. Eventually, the lack of real income to justify the higher consumption will catch up with the households and businesses.”
The Personal Consumption Expenditure, a measure of the amount Americans have spent on consumer goods and services, as a percentage of GDP has stayed slightly elevated since the second quarter of 2022, staying around 68%, while a number closer to 67% has been more common over the last decade, according to the Federal Reserve Bank of St. Louis (FRED). In the second quarter of 2023, it made up 68.1% of GDP.
“In this case, it’s the excess savings,” Ellis told the DCNF. “Those are still being worked down. People are drawing down those savings to counter inflation increasing their core goods and services faster than income growth.”
Personal savings have declined in recent months, falling from over $1 trillion in May to just $794.1 billion in August, paling in comparison to the nearly $6 trillion Americans had saved in April 2020 at the early stages of the COVID-19 pandemic, according to FRED.
Inflation remained high in September, rising 3.7% year-over-year for the month, following the same rise for the month of August. Core inflation, which excludes the volatile categories of energy and food, was even higher for the month of September, rising 4.1% for the year.
Inflation, as measured by the personal consumption expenditures (PCE) price index, peaked at 7.1% in June 2022. In August, PCE inflation stood at 3.5%. Are there risks that might cause PCE inflation to take longer to drop or potentially heat up again? https://t.co/AAjkTqcCxn pic.twitter.com/7PhZwGugIU
— St. Louis Fed (@stlouisfed) October 20, 2023
“In the last three months for which we have data, the growth in consumer spending has outpaced income growth,” E.J. Antoni, a research fellow at the Heritage Foundation’s Grover M. Hermann Center for the Federal Budget, told the DCNF. “Consumers have been using savings and going into debt to fuel their spending. That’s providing a temporary boost to GDP but the decline in savings is also throttling investment, the key driver of long-run economic growth. Savings have been trending down for nearly the entire tenure of the Biden administration because that’s precisely the period in which we’ve had inflation above the pre-pandemic trend.”
Real wages have declined 2.1% from the first quarter of 2021 when Biden took office compared to the third quarter of 2023, according to FRED.
The Biden administration has repeatedly insisted that the economy is in good shape, pointing to the president’s signature economic policy, “Bidenomics,” as the reason. Despite the insistence, many experts have pointed to the high-spending policies at the core of Bidenomics as the cause of the recent sustained high inflation.
“Alas, the U.S. savings rate has plunged back down to normal low levels today,” Chris Edwards, the Kilts Family Chair in Fiscal Studies at the Cato Institute, told the DCNF. “The low savings rate is a concern because it may indicate that Americans expect the government to bail them out if a recession or another crisis hits.”
The Fed has been keen on trying to avoid a recession, even as it keeps rates at a 22-year high. Despite this, Jerome Powell, chair of the Fed, noted at the end of the September Federal Open Market Committee meeting that an economic soft landing, meaning a slowdown in market growth without triggering a recession, was not a “baseline expectation” for the Fed.
“The high probability of recession in the near term is very troubling when coupled with the decline in savings,” Antoni told the DCNF. “People need more savings today than ever to cope with the higher cost of living, and instead, many families are headed into the next recession with less savings and more debt.”
Household debt shot up to a new high in the second quarter of 2023, with Americans collectively owing $17.06 trillion, with $1 trillion of that being held just in credit card debt.
“The notion one often hears by left-of-center analysts is that savings are bad for the economy, but this is based on faulty Keynesian theories,” Edwards told the DCNF. “Savings are hugely positive for the economy because they are the corn seed of growth. Savings fuel capital investment and expansion.”
The White House did not respond to a request to comment from the DCNF.
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How to Prepare for Food Emergencies if You Don’t Have a Homestead or Bunker
In an unpredictable world, where supply chain disruptions, natural disasters, or economic instability can strike without warning, having a reliable food supply is more than just smart—it’s essential for survival. Whether you’re a “prepper” or not, we all know the golden rule: self-sufficiency is key. But what if you’re living in an apartment, working long hours, or simply don’t have the land to turn into a thriving homestead? Don’t worry; there’s a practical, effective way to build your food security without needing acres of soil or a fortified bunker.
The Ideal Prep: Building Your Own Food Empire
The ultimate dream for any serious prepper is controlling your own food production. Imagine waking up to a sprawling garden bursting with fresh vegetables, fruits, and herbs—tomatoes ripening on the vine, potatoes ready to harvest, and greens that provide nutrition year-round. Add in livestock like chickens for eggs and meat, and you’ve got a self-sustaining system that keeps your family fed no matter what chaos unfolds outside.
This approach isn’t just about calories; it’s about resilience. A well-maintained garden can yield hundreds of pounds of produce annually, while a small flock of chickens might produce dozens of eggs weekly. It’s empowering, cost-effective in the long run, and teaches invaluable skills like crop rotation, animal husbandry, and preservation techniques. If you have the space, time, and resources, starting small and scaling up is the best path to true independence.
The Reality Check: Not Everyone Can Homestead
But let’s face it—not all of us are in a position to go full homesteader. Urban dwellers might be limited to a balcony or community plot that’s far from sufficient for long-term needs. Busy professionals juggling jobs, families, and daily life often lack the hours required for daily tending. And for those in apartments, condos, or regions with harsh climates, raising livestock or maintaining a large garden simply isn’t feasible. Factors like zoning laws, soil quality, water access, or even physical limitations can make this ideal out of reach.
That’s where the frustration sets in. You want to be prepared, but without a homestead or bunker, how do you ensure your pantry doesn’t run dry during a prolonged crisis? The good news is, you don’t have to sacrifice your preparedness goals. There’s a smart, accessible alternative that bridges the gap: investing in high-quality, long-term storage food.
The Smart Alternative: Long-Term Storage Food from Heaven’s Harvest
Long-term storage food is designed for exactly these scenarios—providing nutrient-dense, shelf-stable meals that last for decades without refrigeration or special conditions. It’s the perfect solution for preppers who can’t rely on fresh production but still demand reliability and variety in their emergency stockpile.
At Heaven’s Harvest, they specialize in premium survival food kits that make preparedness effortless. Their products are crafted with the prepper mindset in mind: non-GMO, made in the USA, and packed with real ingredients that taste like home-cooked meals, not bland rations. Whether you’re stocking up for a short-term blackout or a long-haul SHTF event, our kits offer:
- Extended Shelf Life: Up to 25 years of storage, so you can buy once and forget about rotation worries.
- Nutritional Balance: High-protein entrees, fruits, vegetables, and dairy alternatives to keep your energy up and health intact.
- Ease of Preparation: Just add water, and you’ve got hearty meals like beef stroganoff, chili mac, or cheesy lasagna ready in minutes—no garden weeding required.
- Customizable Options: From individual buckets to family-sized kits, scale your supply to fit your needs and budget.
- Peace of Mind: Sealed in durable, waterproof containers that protect against pests, moisture, and light.
Unlike generic store-bought cans that spoil quickly or lack variety, Heaven’s Harvest focuses on quality and sustainability. Our food is freeze-dried or dehydrated to lock in flavor and nutrients, ensuring you’re not just surviving but thriving. And for those concerned about allergens or dietary preferences, we offer gluten-free and vegetarian options to keep everyone covered.
Why Wait? Secure Your Food Supply Today
Preparing for food emergencies doesn’t require a homestead or bunker—it requires action. By choosing long-term storage food from Heaven’s Harvest, you’re taking control in a way that fits your lifestyle. Start small with a 72-hour kit to test the waters, or go all-in with a year’s supply for ultimate security.
Visit Heaven’s Harvest today and use code “PATRIOT” for an exclusive discount on your order. Don’t let limitations hold you back; build your resilient future, one meal at a time. Your family will thank you when it matters most.