Bah, humbug! This is the expression of Ebenezer Scrooge, the primary character in Charles Dickens’ classic, A Christmas Carol. As a miser, Scrooge represents greed and stinginess, which are the antithesis of the values of Christmas, namely, charity and goodwill for all. 

A Christmas Carol is the story of Scrooge’s transformation with the help of four spirits or ghosts, namely, the three ghosts of Christmas (past, present and future) and Scrooge’s repentant partner, Jacob Marley. 

Unlike the alleged ghost projects of the Department of Public Works and Highways (DPWH), these ghosts lead to redemption and not corruption.

While we know of Scrooge as being a cruel person, even to those who hold him dear, what defines him the most is his contempt for Christmas because he deems the spending that comes with the season as reckless. If you are a Christian, you would say that he does not get it. It is a season of joy and merrymaking, and it is natural to give gifts, sing and feast.

But Scrooge may not be entirely wrong. 

While inflation is currently below the target range of the Bangko Sentral ng Pilipinas (BSP) of 2 to 4 percent, consumers are still dealing with elevated prices from the inflation of prior years. At the current trend of GDP growth, incomes are still catching up with the cumulative increase in the cost of living. 

Consumers in provinces negatively affected by the typhoons over the past five months are likely concerned about how to balance their wallets as they recover during Christmas time. 

While part of our consumption is supported by overseas workers’ remittances that are enhanced by the weak peso, we also need to consider that jobs in the US and the Middle East are affected by changes in trade policy, renewable energy and fossil fuel prices, the growth of artificial intelligence (AI), inflation and interest rates, and federal budget cuts. 

Why then do we spend so much during Christmas despite these economic challenges? 

In their undated paper on commercial pressure on gift giving during Christmas, Sofie Damen and Dmitri Mortelmans discuss two key points on Christmas, namely: 1) it is a commercial celebration of capitalism; basically, it is a man-made marketing opportunity; and 2) it is a social ritual performed through consumption. 

In some cases, these cyclical rituals have deviated from their intended meaning. One localized ritual is when kids approach their ninongs and ninangs on Christmas day for their “aguinaldo” or “pamasko.” Ever hear of a 30-year-old married individual still visiting his ninong to receive his annual pamasko? We have one of those. 

You can also say that it is all about money. One reason we spend so much during the Christmas season is because of the availability of funds from the mandated 13th-month pay. In economic terms, the 13th-month pay expands one’s budget line and allows the employed folks to spend a little extra — at least temporarily.

While there is a case to be made that consumers may be irrational in spending recklessly during Christmas, Scrooge is also not entirely right. In cases such as the typhoon-hit provinces, where productivity and incomes are in bad shape, this seasonal altruism from different sectors can help optimize welfare.

In other words, help from everyone, even if it’s seasonal in nature, can lift the living and socio-economic conditions in places where climate change and man-made disruptions have created a yawning gap. 

Beyond welfare support, spending during Christmas, whether reckless or not, is a driver of economic output. In his 2002 paper, Yi Wen, currently an economist at the Federal Reserve Bank of St. Louis, found that seasonal swings in consumption, such as during Christmas, are powerful explanatory factors behind business cycles. 

Since economic policies such as central bank decisions on interest rates are dependent in part on understanding business cycles, the ability to assess the strength or weakness of Christmas spending is like maximizing the ghosts of the past and present to predict the future of the economy.

Ebenezer Scrooge was both foolish and wise. Like the old Scrooge, we must realize that times are tough for everyone and next year could be tougher, hence, when we spend, we should spend wisely but fairly. 

But like the reformed Scrooge, we need to open our wallets, buy the fattest goose to help not just the likes of the impoverished Cratchit family but also to ensure that our firms grow and employ more each year. 

And probably like Scrooge, we should still “honor Christmas in our hearts and live in the past, the present and the future, not shutting out the lessons that they teach.”