The American consumer will have less to spend on a per capita basis in the years ahead. That’s the subject of my presentation at the International Council of Shopping Centers RECON convention next Monday morning (May 23). I’m featured at the first general session on a program with the author Joel Kotkin called “It’s All About the Consumer.”

My thesis is pretty simple. Americans will have less disposable income than in recent decades. For a while easy availability of credit masked this trend. But then the credit crisis and recession hit, landing a one-two punch which exposed the harsh reality. When you’re living off credit, as many of us have been doing, prosperity or at least the trappings of prosperity seem easy to come by. Just pull out the plastic or refinance the house.  Voila you have plenty of funds to buy stuff and take fancy vacations. But take away credit and burst the inflated housing value bubble and suddenly you’re exposed for what you are—either in debt or facing a bleak future with limited savings. That’s the unfortunate plight of many Americans today.

Now face the fact that most American’s wages have at best stagnated over the past decade, pushed down by global competition and technological “productivity” advances. Add in how most people have to pay more for their healthcare and have seen their pension benefits eroded by 401K options replacing defined contribution plans. Consider higher energy costs and the inevitability of higher taxes (state, federal, local) to pay for basic services that everyone wants. And let’s not forget that interest rates will increase off of their current artificially low rock bottoms, increasing future borrowing costs.    

When you remove easy credit, deal with wage stagnation and benefit erosion, and cope with higher expenses—it all means you will have less to spend at the local mall or big box store.

Now the good news for America is that we will be growing by more than three million a year for the foreseeable future—thanks mostly to immigration. We could be Japan or Germany—their populations are forecast to shrink, the result of restricted immigration policies and low birthrates. At least, added numbers will support increased consumption here.

Now our politicians talk about green jobs and lower taxes bringing back our economy. Yes, the United States is and should continue to be the most innovative country in the world. But once some smart American invents a new product, it still will be cheaper to make it overseas where workers are paid a fraction of what they make here. And given that federal tax rates are at their lowest in 50 years and after more than a decade of Bush tax cuts, you have to wonder when those tax cut benefits really start to kick in. For now, many American pay less in taxes because they make less. And that’s just bad news in the retail world.

See you in Las Vegas.