What You Can Do

Economist James Kwak offers some excellent holiday suggestions:

On one level, recessions are about numbers, like the post I just wrote about the November statistics. On another level, recessions cause enormous hardship and misery to real families. I know most of us have less wealth than we did a year ago, since two major sources of household wealth – stocks and housing – have fallen steeply in value this year. But even if you don’t feel like you can afford to donate as much as usual to charities, there is still something you can do.

Most middle- and upper-income American households have lots of stuff. Many of us, particularly adults, have lots of clothes and other things we rarely or no longer use. You can think of this either as a behavioral phenomenon (people don’t like to get rid of things, even if they cause more disutility by taking up closet space than any utility they will ever provide) or as a market failure (it’s too much of a hassle to get rid of things, so we keep them). But if you just take a day, identify the things you will never use again, put them in bags, and drive them to a local shelter, you can help allocate those goods to the people who value them most. Or, as non-economists put it, you can help people. And, of course, you can get a tax deduction (the shelter in my town recommends using the Salvation Army valuation guidelines), which is itself probably worth more to you than those clothes you will never wear again.