More than 100,000 families - many of them amongst the poorest in Britain - put money aside for Christmas gifts and other seasonal treats in a savings club called Farepak. It wasn't a bank, and it wasn't great value for money... and it went bust. Kids went without toys, and festive dinner tables were left bare.
Why would someone put their hard-earned money into such a scheme? And what does it tell us about how we often view Christmas as a time for frenzied spending?
For a full list of sources used in this episode visit Tim Harford.com
CAUTIONARY TALES RETURNS 6 JAN, 2023. HAPPY HOLIDAYS AND SEE YOU IN THE NEW YEAR.
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12/09/22 • 35 min
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Cautionary Tales with Tim Harford - The Company That Cancelled Christmas
Transcript Summary
In this thought-provoking episode titled "The Company That Cancelled Christmas," delve into the story of Susie Hall, a single mother who lost her Christmas savings due to the bankruptcy of the Christmas savings club, fair Pack. Explore the enlightening research of economist Joel Waldfogel, who reveals how gift-giving often leads to wasted money. Discover how fair Pack customers, trapped by limited options and no interest on their savings, faced uncertainty about compensation and even resorted to borrowing money for gifts. Uncover the startling statistics that show the hefty post-Christmas debt of two-thirds of December spending and the estimated $20 billion wasted in the US and $50 billion worldwide every year. Reflect on the implications of this immense wastage on climate change and the emotional toll it takes on those who can't afford extravagant gifts. Learn about the importance of thoughtful gestures over expensive presents and receive suggestions on how to create a more meaningful Christmas. Join this episode to gain profound insights into the economics and societal impacts of Christmas, challenging our perspectives on the holiday season and inspiring a shift towards more heartfelt celebrations.
Transcript
Pushkin. It was Friday the thirteenth, and some people would have expected bad luck. Susie Hall didn't. She knew, of course, that life could deal out some hard knocks. A decade before, when she was twenty eight, she was attacked in the street in her home city of Edinburgh by three men who took her purse, her car, and her peace of mind. Now in her late thirties, she was still being treated for depression and anxiety, trying to keep it all together
The Company That Cancelled Christmas Top Questions Answered
How much money do Americans spend on Christmas each year?
Americans spend $100 billion on Christmas each year.
What is the estimated global amount wasted on Christmas gifts?
An estimated $50 billion is wasted globally on Christmas gifts.
How does bad Christmas gifts contribute to climate change?
The deadweight loss of bad Christmas gifts results in the wastage of real resources, such as energy, which contributes to climate change.
How long has the commercialization of Christmas and gift exchange pressure been around?
The commercialization of Christmas and the pressure to exchange gifts has been present for a long time.
What does Harriet Beecher Stowe's stories highlight about expensive gifts?
Harriet Beecher Stowe's stories highlight the disconnect between expensive gifts and their sentimental value.
How do bankrupt companies like Fair Pack affect their customers emotionally?
When a company like Fair Pack goes bankrupt, customers often lose a significant amount of money, causing emotional distress.
Why do some people feel ashamed if they cannot provide proper gifts at Christmas?
Some people feel ashamed if they cannot provide proper gifts at Christmas, which contributes to pressure and isolation.
What do studies show about the perspectives of gift givers and recipients?
Studies show that gift givers and recipients have different perspectives on what makes a thoughtful gift.
How can individuals redefine the Christmas culture to spend less but think more?
Instead of canceling Christmas, individuals can have conversations with loved ones to redefine the Christmas culture and spend less but think more.
What lessons on gift-giving are demonstrated by the reformed Scrooge from A Christmas Carol?
Reformed Scrooge from A Christmas Carol demonstrated a meaningful and practical approach to gift-giving by focusing on genuine needs and personal attention.
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