The Haves and the Have Nots

There’s one good indicator of just how Bush has impacted the economy of the United States, benefiting the rich and hitting hard on the working class. This Christmas season, upper echelon retailers like Tiffanys and Nieman Marcus are doing a boon, with customers characterizing their purchases like, “I’ve spent a lot of money this year”, while WalMart and KMart shoppers, strapped for cash and extended credit way beyond their means, are saying, “Things are tighter this year”.

And how many of these WalMart shoppers are Bush supporters? They’re okay with tax cuts for the rich?

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Tale Of Two Christmases
Dec. 18, 2004

It’s a Charles Dickens Christmas — a Tale of Two Economies.

High-end retailers such as Neiman Marcus and Tiffany are thriving, while discount chains such as Wal-Mart are suffering, reports CBS News Correspondent Trish Regan.

Recent sales figures from the nation’s largest retailers underscore the growing gap between the haves and the have-nots.

Wal-Mart missed its November sales numbers, posting a meager seven-tenths-of-a-percent gain over November, 2003. The company had expected 3 to 4 percent sales growth. City saw a 3 percent decline in sales last month, and K-Mart’s sales are likely to drop 10 percent.

“You have wealthy consumers spending in unprecedented proportions and the cash and credit starved consumers are suffering,” says retail analyst Burt Fleckinger of the Strategic Resource Group.

Why are lower income consumers suffering? Gas prices and home heating costs are up 30 percent from last year, Regan points out, taking $1 billion from Americans’ pocketbooks every week. And with interest rates at their highest level in three years, consumers are feeling the pinch.

One K-Mart customer told Regan, “Things are tighter this year.” Another said, “I’m watching what I spend.”

“Consumers are tapped out,” Fleckinger says. “They’re spending about 20 percent more to cover their credit interest rates. They’ve spent the money on home refinancing and they are not getting several hundreds dollars back from the government this year.”

With those extra cash infusions such as tax rebates gone now, it’s only the wealthy who have real spending power, Regan observes.

One Shopper at Tiffany summed it up simply to Regan: “I’ve spent a lot of money this year.”

Thanks to high-end shoppers, overall retail sales are expected to increase 4.5 percent this year, to $220 billion — good news for luxury stores, but this year, just coal in the discounters’ stockings.

©MMIV, CBS Broadcasting Inc. All Rights Reserved

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