Cheap Thrills: In this economic climate, bargains come at a price

from The American Prospect:



Cheap Thrills
In this economic climate, bargains come at a price.

Noreen Malone | July 9, 2009


I recently threw out a pair of versatile black ballet flats that I have worn exactly eight times. They only cost $12, so the price-per wear was less than I pay for coffee each morning. I'm not angry that they fell apart so quickly; in fact, I can pick up another identical pair from Target. I've known a lot of ballet slippers in my life, but none have cared to stick around too long. It's easier on my budget to buy four or six or even eight pairs a year rather than purchase one nice pair that might last longer but is destined for the same trash heap. Buying more is the way to economize: Clearly, this is not my grandmother's downturn.

Cheap is having a moment. Each day since the financial collapse brings a new story about the countercyclical discount sector. Dollar stores, Wal-Mart, McDonald's -- all are going great guns. But it's not just acceptable to pinch a few pennies these days, it's downright fashionable. Magazines like Vogue, tone-deaf to cost in the prelapsarian recent past, have creakily bent their editorial stance to include new features on low(er)-priced clothing. The too-cute-by-half buzzword "recessionista" has entered the common lexicon (alongside the William Safire?approved "frugalista"). Google the very word "cheap" and (at the time of this writing) the fourth hit is a guide to the new low-rent lifestyle by New York magazine, a publication previously distinguished by its slick, housing bubblicious commodity fetishization.

This new moderation might be bad news for the broader American economy, but it is perversely good news for Ellen Ruppel Shell, an Atlantic reporter who's just released Cheap: The High Cost of Discount Culture, an exploration of the ways we've been seduced by low prices into forgetting our best interests. The book treads some familiar ground for anyone acquainted with the anti--Wal-Mart movement, which criticizes the mass retailer as the apotheosis of exploitative labor practices and inferior goods. But Ruppel Shell's aim is to synthesize those invectives into a larger argument, one that eventually builds to blame the economic meltdown on our "fixation on all things cheap."

It seems like a long leap from the Dollar Menu to mortgage-backed securities, but it's also, in a way, an obvious connection. We are naturally susceptible to the thrill of a bargain. Ruppel Shell draws heavily on the work of behavioral economist Dan Ariely to show the many ways that we allow ourselves to be exploited by marketing and conditioned to crave that feeling of getting more for less -- like, say, more house for less money down. You know how that story ends.

But I didn't buy a house, much less one I couldn't afford. So what does my habit of buying $12 shoes have to do with the financial mess we've found ourselves in? Because the only way to make something that cheaply, of course, is to underpay workers, who themselves become squeezed and have no choice but to buy low-end goods. This locks in the discount market still more solidly and widens the chasm between what's truly affordable and what's presented as necessity. (It's not just low pay that's stretching these workers, nor is it merely the oft-blamed American spending addiction: Ruppel Shell cites the amazing statistics that in 2003 we spent 32 percent less on clothes and 18 percent less on food than our parents did in the early 1970s but 76 percent more on mortgages and 74 percent more on health insurance.) ..........(more)

The complete piece is at: http://www.prospect.org/cs/articles?article=cheap_thrills