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Ralph Nader > In the Public Interest > Luxury and Excess

Thorstein Veblen — the turn of the (nineteenth) century social scientist who coined the term “conspicuous consumption” — would blush if he were to witness today’s consumption patterns.

Luxury and excess have been taken to new flights of fancy, and have become the object of desire for an ever greater portion of the population. In her recent book, Do Americans Shop Too Much, Harvard Professor Juliet Schor points to a “new consumerism,” the centerpiece of which is “upscaling of lifestyle norms” irrespective of ability to pay.

Much of the luxury buying is of course being done by newly minted millionaires, as the Reagan-Bush-Clinton regime features the ever greater concentration of wealth in the hands of the few at the top. But Schor’s important point is that even those who haven’t benefited from the boom at the top are engaged in a flurry of frivolous spending.

Driving the current luxury and other excessive consumption binge are the marketing mavens — the consumer product companies, the Madison Avenue advertising firms, the new marketing consultants, and the hypercommercialism the marketers and their clients have entrenched in the cultural landscape.

The credit card industry, for example, sends out 2.5 billion solicitations each year; credit card advertisements urge consumers to, simply, spend. The result has been a sharp upsurge in credit card use in the last decade — and a simultaneous increase in consumer debt. Does anyone doubt that the credit card industry’s aggressive marketing efforts have fueled the skyrocketing provision and use of credit cards?

Or consider pharmaceuticals, where the drug industry’s investment indirect-to-consumer (DTC) advertising has risen from $25 million in 1988 to more than $225 million in 1994, $610 million in 1996 and more than $1 billion in 1998. The purpose of DTC advertising — which appears on television, in magazines, over the internet and in any other forum the industry can use — is to convince patients to badger their doctors to prescribe brand-name drugs — drugs which they may not need, drugs which may be unsafe, or drugs for which there may be better or cheaper substitutes. No one, least of all the pharmaceutical industry, seriously questions that DTC advertising bumps sales.

To the marketing push, Schor adds other social factors as contributing to today’s luxury fever. She argues that an increasingly skewed income distribution has stretched out the consumer-comparison hierarchy. Those aspiring to emulate those one, two or three notches above them on the income ladder must now reach higher, because the space between rungs has expanded in the last two decades.

Meanwhile, television programming has delivered portrayals of the lifestyles of the wealthy into homes of every social group. Along with the breakdown in neighborhood cohesiveness and the entry of women in the workforce, she contends, the television factor has led consumers to shift their point of reference from their next-door neighbor (likely located in the same income group) to the increasingly remote upper income groups.

The trend of ever more conspicuous consumption will not be reversed through a series of individual choices. It will require a shift to a culture of civic engagement, a seeking of value and purpose in a realm other than things. This shift will not just happen. It will require, among other things, a revitalized consumer movement built on institutional arrangements that encourage consumers to reorient their buying practices.

Independent consumer organization will give rise to new values, new modes of analysis and new policy ideas — and generate the political momentum for new policies.

Some of the forms of consumer organization that require nurturing:

+ Banding together for group buying: Wholesale group buying operations — where tens, hundreds or thousands join together to negotiate bulk purchases and lower prices — exist in patches around the country, especially in home heating oil markets.

+ Banding together for group information sharing and complaint handling: The internet offers unprecedented opportunity to create clearinghouses of consumer-generated information on product quality, defects, billing frauds, etc., with equally promising opportunities for victimized consumers to negotiate as a group for redress.

+ Banding together for group negotiating: Voluntary, mass-based consumer policy organization could remake the terrain of consumer-seller interaction. Utility consumers in Illinois, for example, are able to join a consumer group that has saved them billions of dollars in electric bills. In conjunction with state government mailings, consumers receive a notice asking them to join a membership organization, controlled by dues-paying members, that advocates on consumers’ behalf before utility regulatory bodies. This model, based on a simple solicitation insert in mailings that would otherwise be sent (and therefore add no postage costs) needs to be replicated around the country, and for many other industries — cable, banks, insurance, auto companies, etc.

These and other forms of independent consumer organization would work not only to redress specific consumer demands, but to help create a consumer culture that places value on quality, good value, ecological and social considerations in production processes. Banding together as consumers broadens horizons, creates countervailing political power to oligopolistic sellers, and contributes to a shift in the buyer paradigm from conspicuous to conscious and conscientious consumption.