An illustrative tale about holiday spending in inflationary times
Total consumer spending accounts for more than two-thirds of US gross domestic product, so economic forecasters watch spending trends on major holidays like a hawk – and for good reason. The 2023 version of Black Friday reported a record $9.8 billion in Black Friday online sales, up 7.5% from 2022, not accounting for inflation. On Cyber Monday consumers spent $12.4 billion, a 9.6% increase from 2022.
If you want to get a clear understanding of what these massive numbers represent, here’s what retail sales would be in terms of what the Grinch might steal from all of us at Christmas. Imagine the Grinch hauling the entirety of Whoville’s Christmas goods up Mount Crumpit.
You’ll remember this story from Dr. Seuss’s “How the Grinch Stole Christmas” and The Credit Review provides the numbers that translate the classic children’s tale into a 2023 economic story that asserts that, if the Grinch stole Christmas in 2023, it would be worth $14 million in Whoville goods
The story
Imagine the Grinch hauling the entirety of Whoville’s Christmas goods up Mount Crumpit.
Fast-forward to today in 2023, with inflation, Christmas spending higher than ever, and the fast-approaching holidays, the personal finance experts at The Credit Review wanted to know — how much would the Grinch’s Christmas haul have been worth today?
To figure it out, they defined a few key pieces of data:
- Where is Whoville? Legend has it that the fictional Whoville from Dr. Seuss’s How the Grinch Stole Christmas! was modeled off of Easthampton, MA. In 2023, the small city has a population of just about 16,045 people, according to Census data.
- What did the Grinch steal? From the story, “All the presents, the food for the feast, and even the Christmas tree.”
- How much? According to a survey from the National Retail Federation, the average consumer plans to spend $875 on Christmas-related goods in 2023 (which includes gifts, food, holiday decorations, and other holiday goods).
Multiplying the population of our modern-day Whoville by the average core holiday spending numbers, The Credit Review found:
In 2023, the Grinch would steal $14,039,375 worth of holiday goods.
Ironically, Dr. Seuss was inspired to write the book in 1957 because he was annoyed by the commercialization of Christmas.
It turns out that commercialization has increased substantially since then.
The Credit Reviewcalculated that consumers have spent an additional 3.3% yearly on holiday goods since 1957 — a compounding of holiday spending on top of inflation increases. This calculation comes from a breakdown and deeper analysis of data from 24/7 Wall Street’s historical spending report.
The Credit Review Team also found that while spending has increased 3.3% annually, per capita income has only increased 2.1% across the same period.
Using these findings, The Credit Review found that if the Grinch were to steal Christmas in 1957, the year the book was published, he would have stolen the equivalent of $1,198,854 in holiday goods (in 2023 dollars).
Even after adjusting for inflation, American incomes and holiday spending patterns were much smaller in 1957 than in 2023.
In 2023, Americans spend 8.75 times as much on core holiday goods (gifts, food, holiday decorations and similar) than in 1957, and that’s not even accounting for holiday travel and additional costs.
In the end, the Grinch returned all the goods, so the citizens of Whoville could celebrate Christmas after all.
But Dr. Seuss and his estate never had to return the millions they’ve made from his numerous beloved best-selling books.
Nearly three decades after his death, Dr. Seuss’s estate earned an estimated $33 million before taxes in 2020. This landed him at #2 on Forbes’ ranking of the Highest-Paid Deceased Celebrities for 2020.
Dr. Seuss claimed the Grinch was based on himself, as his wife’s illnesses and dismay with the commercialization of Christmas frustrated him around the time he wrote the book.
The Grinch may have returned all of the presents in the books and movies, but Dr. Seuss and his descendants made quite a bit more money, money that they’ve kept thanks to his classic tales and modern streaming service royalties.
Methodology
- The Credit Review used estimates from the National Retail Federation findings the average consumer plans to spend $875 on Christmas-related goods in 2023. (It’s worth noting we used this more conservative retail estimate to focus on “consumer” spending rather than the recent poll from Gallup asking about American’s spending perceptions).
- Whoville is said to be modeled off of Easthampton, MA, which has a 2023 population of 16,045.
- Multiplying these two numbers, The Credit Review arrived at a total of $14,039,375.
- To adjust for 1957 data, The Credit Review calculated the growth of consumer spending between the years of 1957 to 2015 using data from 24/7 Wall Street. They found that since 1957, there has been an average 3.3% compound annual growth rate in increased spending every year, on top of inflation changes. This increase in spending encompasses the entirety of holiday spending, including travel and other spending.
Sources
