Central London: 5 pm, Friday night, December 9.th.
A Jamaican steel drum band had set up across from Marble Arch at the end of Oxford Street, one of the major shopping boulevards in London. They were performing their version of “Hark the Herald Angels Sing.” The sidewalks on either side of Oxford Street were packed. Stretching as far as the eye could see toward Oxford Circus were this year’s overhead illuminated “festive season” (the politically correct designation for this time of year) decorations. The repeated pattern included gift boxes, umbrellas and a large iconic stylized star which bore a striking resemblance to the logo of the Chrysler car company. The fronts of stores were also alight with streaming displays of colored bulbs and glittering trims.
Just past Selfridge’s, one of London’s most famous department stores, on a side street, a team of men were off-loading stacks of orange plastic traffic cones. Overnight, their task was to secure inroads into Oxford and Regent Streets, (which intersect at Oxford Circus) so that kiddy rides and platforms and all manner of food and entertainment stalls could be set up for the weekend’s – pedestrians only – shopping fair. The idea was apparently to celebrate holiday shopping for what it has become – a real circus.
Yet this street fair echoed a tribute to various Christmas villages which spring up all over Europe during the holidays, some for as long as three months. They are tourist draws cum retail attractions, luring many with fantastic displays of lights, food, song and treasures.
But behind all these displays of cheer, this December there are deep fears. Like villagers with brightly burning torches, everyone seemed determined to scare away the economic monster which was overshadowing what will come after Christmas in Europe.
Early on Friday morning, the British Prime Minister, David Cameron, had derailed the latest meeting of European Union members by using his veto to reject a proposed new fiscal union which overreached the EU’s legal authority. Pundits had predicted that failure to reach an agreement at this summit (as opposed to all the ones before and those still scheduled) would bring on “Euro-gedden,” a financial apocalypse. Some said it would leave Britain isolated from the European Union. Others slyly agreed saying, “yes, as isolated as the person who missed sailing on the Titanic.”
This prediction is not without merit which might well explain much of the “eat, drink and be merry, for tomorrow we die” attitudes across the UK and Europe, where consumer confidence levels sunk to their lowest levels in October.
Responding to questions from a reporter, a group of women in a Berlin bar said: “We don’t want to talk about the eurozone crisis. We are here for the shops and now it’s time to get drunk.” Upon hearing this, cheers went up at nearby tables. This was not a universal sentiment.
While budgets for holiday season celebrations and decorations were up, albeit modestly, in Germany, France, Spain, Belgium, Luxembourg, Finland and Poland, consumers in the Netherlands, Ireland, Italy, Portugal and Greece told researchers that they would be cutting back on Christmas spending.
This dichotomy of the spend now, pay later outlook is nowhere better illustrated than in the UK, where diverse factions and factors are in play.
Food: The major supermarkets chains across the UK (and in other EU countries it must be said) are engaged in a price war. A two page Sunday national UK newspaper article spread out the categories of traditional holiday fare, posted along with their ratings by food tasters, and the price variations on offer among the stores. The idea behind this competition is that in order to save money people will be staying at home to feast on both Christmas and Boxing Day (Dec 26th) and, therefore, the store which offers the best prices will attract the most customers looking for deals. While this may be a great idea for food stores, restaurant and pub owners are complaining that they cannot offer the same sweeping discounts and will lose customers. It was also noted that more nights at home meant decreased sales of fancy party dresses for the ladies.
Travel: The famed Thomas Cook Travel empire has been hit hard financially as the sort of exotic holiday trips for which the British are famous were postponed or canceled. Closer to home, members of the union which controls more than half of London’s Underground Tube network are threatening to walk out on either (or both) Christmas Eve and Boxing Day. They are demanding triple pay for working on those days. A strike ballot will be cast on December 14th. And last but not least, courier services have warned that they are already swamped with orders since trust in the Postal Service has deeply declined. The industry expects to deliver 4 million parcels per day, but if there is bad weather leading up to Christmas, deliveries will be put at further risk and delays will be inevitable.
Weather: Speaking of bad weather, several leading economists have suggested that a White Christmas might push late buyers and gift exchangers into doing business in January, thereby saving Britain from a double-dip recession, defined as two successive quarters of negative growth. Betting firms (which are legal and have walk-in operations in every town) are shifting the odds for a White Christmas with every long range weather forecast.
Internet sales: Doing well in this category. With mobile phone aps which allow both comparison shopping and “Click and Collect” services, European internet sales were expected to rise by 20 percent for the two months leading up to Christmas and 30 percent for the “click happy” Britons. “Click and Collect services save vast sums for participating shops as they eliminate the need for shipping.
The Meaning of Christmas: President Obama is not the only world leader who has tsars/czars. The British PM has appointed one too. Reg Bailey is the new Childhood Tsar, tasked with protecting British children from commercial pressures and over exposure to “sexualised images” in advertising. To that end, Bailey set up www.parentport.co.uk so that parents can easily lodge complaints.
As the Festive Season approached, Mr. Bailey went into action with a campaign to encourage parents not to buy too many toys for their kids. Now this seems counter-intuitive when retailers are desperate to make sales and stay in business and, indeed, a hue and cry from retailers went up once this plan was launched. So did promotional signs offering 50 percent off everything in their stores.
But Mr. Bailey, who also serves as Chief Executive of The Mothers Union, an international Christian Charity, was determined to strike a blow against the commercialization of Christmas. He told parents not to succumb to the pressure of “pester power,” those endless calls of their children to get for them what their friends have and thus ensure that it will be harder to make ends meet in as another economic recession looms.
Consumer Debt: There is a curious lack of regulation on interest rates for consumer loans in the UK. Some of them are as high as an annualized 4,000 percent (yes, Four Thousand) on what are known as short-term “pay-day loans.” These are typically loans taken out for between £50 and £300 and are used to pay for gas and electricity bills, as well as for over indulging in Christmas gifts, are generally paid back within 45 days. When they are not, with such astronomical interest rates, the results can obviously devastate a family’s finances. Sources indicate that as many as 3.5 million Brits will be forced to take out pay-day loans or, worse, turn to outright loan sharks to get out from under Christmas debt.
The Outlook: The German Society for Consumer Research is predicting a surge for that nation’s retailers this Christmas, but pollster Klaus-Peter Schoeppner was quoted as saying that this spending spree is a “flight from the real world” from which people will awake next year with a consumer debt hangover.
In Monday’s edition of The (UK) Daily Mail, a headline story gave a very gloomy forecast, assembled from the predictions of top economists: “UK recession will be far worse than we thought, admit experts. British economy to shrink by 1.3per cent next year.”
In another attempt to forestall the inevitable, the British government announced it will flood the economy (again) with billion of Pounds in hopes of easing “the exceptional stresses in financial markets.” But this may be just more futile torch lighting among the villagers who are hoping to frighten away the economic monster. For its part, the monster is waiting for the village Christmas lights to be extinguished as the darker days of winter draw near.
Susan Easton is the International Correspondent for OfficialWire. She holds an MA in Theology and Religious Studies. She is an author, poet and can be found in London, San Francisco or otherwise roaming with an eye for untold stories.