Consumerism again

Heath and Potter find Thorstein Veblen’s critique of consumerism much more persuasive, “far more penetrating than any of the theories developed in the 20th century.”

Veblen argued that while poor societies devote every increase in production to meeting basic needs, richer societies can devote increases in production to “honorific” goods: “Clothing becomes more ornately decorated, houses become larger, food preparation becomse more elaborate and jewelry begins to make its appearance.” The key is that all these luxury goods serve as badges of social status.

Veblen described these outputs as “wasteful,” but was careful to explain what he meant by that term. He said that the word “implies no deprecation of the motives or ends sought by the consumer,” but rather it’s wasteful because when everyone consumes these badges of social status, the end of the game is identical to tbe beginning.

Heath and Potter use the example of a doctor who wants to project the image of success by driving a BMW rather than a Honda. That only works to attract customers if some doctors don’t drive BMWs: “If every doctor runs out and buys a BMW, then patients still have no basis for choosing one doctor over another. The situation is the same as when they were all driving Hondas, except that now everyone is saving less and spending more on their car payments.” Soon, the Bimmer is seen as nothing more than “an entry-level car,” and some doctors start drive Mercedes or Jaguars, but others have to do the same to compete, and soon everyone is again back where they started.

This dynamic is clearest among people who spend a lot of their time and energy climbing the social ladder or seeking high social status. But even those who aren’t interested in that kind of social climbing end up in a similar situation, as they strive to maintain a “respectable” standard of living, which requires them to spend more year in and out: “Their consumption takes the form of ‘defensive consumption,’ since they are for the most part just trying to avoid humiliation.”

Heath and Potter claim that “when it comes to explaining the nature of modern consumerism, Veblen obviously hit the nail right on the head.” Yet, the 20th century critics of consumerism resurrect Marx’s false theory and resist Veblen. The reason, they say, is that Veblen “commits one cardinal sin: he blames consumers for consumerism .” Even more seriously, he says that consumerism is “maintained by competitive consumption among all classes of society .” Workers are not oppressed by capitalists and advertisers; workers participate in the system voluntarily and actively.

In fact, Veblen’s theory explains why it is a fact that the poor are more apt to spend than save than the rich: “Social status, like everything else, is subject to diminishing marginal utility – the less you have of it, the more you are willing to pay to get some. Thus lower-status groups are willing to dedicate a greater percentage of their income to competitive consumption than are high-status groups. People in the upper class already have so much status that they’re not willing to make any great sacrifices to obtain more of it. The lower classes, on the other hand, are.” Veblen’s theory not only fails to blame the rich; it tends to place responsibility for consumerism on the classes that for Marxists are the oppressed.