Moral revulsion at the shallowness of America's consumer culture has been a staple of intellectuals and theologians for more than a century. Today, in the wake of the recession, public scolds are lambasting this nation's runaway culture of debt and profligacy with an I-told-you-so righteousness. The most recognizable of the new frugalists is David Ramsey, the Scrooge of excess whose Financial Peace University promises liberation from the bondage of personal debt.
And now: The backlash. Apologists for consumerism are reasserting themselves. In an economy driven by consumer spending, we are reminded, the unemployment rate will not fall until shoppers get back to the business of spending, or better put: overspending. But few have attempted to defend consumerism with the panache and bravura of James Livingston, a history professor at Rutgers University who specializes in U.S. cultural and economic history. In "Against Thrift: Why Consumer Culture is Good for the Economy, the Environment, and Your Soul," Livingston contends that consumerism improves life in every way imaginable, from the physical to the intellectual and the moral spheres.
Among Livingston's claims: Consumerism and advertising drove the civil rights movement and helped bring about the downfall of communism. These great social upheavals were, in essence, retail revolutions.
19th-century news
"The new Puritans, those 'frugalistas' who believe that a sustainable model of growth requires a 'return to thrift' - less consumer debt, more saving and investment, and so on, in keeping with the common sense of our time - are peddling nineteenth-century news," Livingston writes. "We have reached a point where we have to confront our fears about consumer culture, because the renunciation of desire, the deferral of gratification, saving for a rainy day - call it what you want - has become dangerous to our health."
The crux of Livingston's argument is that consumerism arose out of 20th-century trends that fostered greater freedoms and spending power. The expansion of government led to a boom in government hiring, and the rise of labor unions led to better pay for non-government workers. Thus living standards kept rising with the government tide into the 1970s. Subsequently, when private sector wages stagnated, consumers increasingly financed their buying habits through debt.
Before the 20th century, the mass of humanity had been focused on basic necessities, not on leisure time and discretionary spending. In this country, the shift to consumerism happened around 1919, as a result of the productivity gains made possible by machines. China and India are just now transitioning from a culture of scarcity to a culture of surplus, nearly a century after the United States made the leap. It is an evolution from an Industrial Age economic system based on exploiting labor to a more benign paradigm, one in which the interest of workers and the interest of business is aligned, or should be.
Corporation as foe
In this morality tale, the consumer has a mortal foe: the corporation. Whatever cash-on-hand corporations don't spend on employee wages and benefits, Livingston argues, they will tend to hoard as surplus capital. All that extra money will blindly seek an outlet, and, lacking productive investment options, a global savings glut will flow to speculative markets and investment bubbles, endangering social stability. In recent decades, that would explain such investing frenzies as the hostile takeovers of the 1980s, the dot-com bust of the 1990s, and the real-estate bubble of the last decade.
Put another way: Corporate America has more money than it knows what to do with, and, for lack of viable options, the money is too often dumped into a cesspool of false promises. Spending on employee salaries and benefits, however, would be the wisest course of action because it would perpetuate consumer spending and spread the benefits all around. That would empower financially secure workers to buy more and more stuff, which in turn would generate manufacturing and production and finance.
Livingston is not an economist and doesn't acknowledge the remotest possibility that bloated organizations can't compete in a global market. He doesn't offer a policy prescription on how a society might equitably redistribute wealth, other than giving a general shoutout for the hidden blessings of taxation.
Livingston seems to be saying: Let go of your hang-ups, have a little fun sometime. But under closer scrutiny, what is true in "Against Thrift" is not particularly new, and what is new in it is not entirely true.
While Livingston cites pretty much every major economist from Adam Smith to Alan Greenspan, and includes an appendix of graphs and charts to bolster his conclusions, his sweeping overview is as much cultural as it is economic, sprinkled with cultural allusions to Freud, Marx, Nietzsche, Whitman, Kierkegaard, Aristotle, Poe, Machiavelli, Melville and Mad Men.
Nonetheless, "Against Thrift" lacks the spunk of superior pop-culture books of its type, such as "Freakonomics" or pretty much anything written by Malcolm Gladwell - which seduce with their inventiveness and originality, even if we find ourselves in disagreement with the authors. Pages and pages of Livingston's prose read like so much academic padding, no doubt the consequence of Livingston's immersion in the dense, plodding texts of social theorists he cites throughout his own book.
Put another way: What Livingston's book sorely lacks is consumer appeal.
