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You have decried lack of savings by Americans, but many people are following the signal given by their government. The big screen TV is taxed very little by the federal government,

I am sorry if my post was unclear. I did not decry the lack of savings as much as lack of investment in ourselves: learning new computer skills, a technology adjacent to our own, a foreign language, etc. --- all this make one more competitive. We gave children terrific education up until 1950s-60s, when feel-good orientation replaced results-oriented approach. We even deal with illiteracy now. How do you think illiterate people can compete?

were a family to forgo consumption by sticking with their older TV in favor of savings what happens. The interest they earn, already low, is taxed at the highest rate they pay.

This is only a part of equation. The family that does not save still wants medical care. It demands it from the employer. The employer says "no" be not hiring them. What is the cost of that TV? Was it better to save to spend on that TV.

And that is what appears to happen now. People want to have their cake (big-screen TVs, big houses, etc) and eat it too (gimme health care, education for my kids). These demands make our, American labor more expensive, and the jobs go elsewhere.