Is mass consumerism a choice?

Floris writes*

We all know we live in a consumerist society, but what are its origins and did it develop naturally? This post explains the surprising influence of Freud on our consumerist society. It all started at the 1929 Easter March in New York when a group of women lit their cigarettes— an act publicly unacceptable at the time, and even considered rebelliously feminist. For many, including the women, the lighting of their cigarettes seemed to indeed be part of a greater struggle for power; the Women’s Liberation Movement. However, few were aware that the actual intention behind the action was for the American Tobacco Company to increase cigarette consumption among women. These women were paid by Edward Bernays, Sigmund Freud’s nephew, to light their “torches of freedom”— the cigarette became symbolic of women’s freedom. I argue firstly that this event marked only the beginning of the implementation of Freudian psychoanalysis as a tool used to promote consumerism in America, and that still today, we are living in a society full of passive consumers.

In part one and part two of the brilliant documentary The Century of the Self, we see how Freud’s ideas were employed in order to create a mass consumption society. Freud believed that humans are irrational, governed by their subconscious fears and desires. Bernays, through his work as a Public Relations Counsellor to American corporations, applied these theories in his advertisements. These ads appealed to people’s innermost desires, leading them to consume more. For example, Bernays suggested to remove an egg from an instant cake mix which consumers had to add in themselves. He believed this would help eliminate the sense of guilt housewives felt for not having made a cake themselves from scratch. This seemingly simple change had the desired effects and sales increased massively. This strategy turned people into passive consumers. However, this passivism turned into activism when people began to notice and discover the selling strategies and conditioning. In 1962, awareness increased especially after celebrity and high-profile psychoanalyst patient Marylin Monroe committed suicide.

In part 3, it is shown how corporations in the 60s and 70s turned activism into a new kind of consumerism based on individual rather than mass needs. During the 60s, an alternative psychoanalytical perspective regained popularity, it was originally developed by Wilhelm Reich who believed the opposite of Freud. In his view, humans are good in and of themselves and that society repressed their inner selves which made them violent and mentally unstable. He argued that people should express their fears and desires which would allow them to be freed of the conditioning and control by society. This created individuals with individual desires, which meant the end of mass consumerism and a problem for corporations who couldn’t sell their mass-produced homogenous products to individuals. But then a different psychologist, Abraham Maslow, argued that people’s different desires could be categorized in a hierarchy of needs. This meant that corporations could now develop products based on categories in the hierarchy of needs. Therefore, the products seemed highly personalized which emphasised the feeling of individuality in consumers, which made them buy them.

By the end of the century, society had experienced an ideological shift from a mass consumerist society to an individual consumerist society which allowed companies to supply products for ever-changing needs which allowed consumerism to flourish like never before. A report by the US Department of Labor and Statistics [pdf] looked at consumption statistics in the US between 1901 and 2003. From 1918-19 to 2002-03 household expenditures grew from around $1,500 to roughly $41,000. On top of that, from 1959 to 2001, consumer spending on non-essential goods and services increased from 4% to 9.3%.

Today, nearly 50 years later, we are still living like passive consumers. From 2003 to 2017 US consumer spending increased from $41,000 to $60,000 a year. The only exception being a slight drop in the years after the financial crisis of 2007-08. Consumer spending on non-essential goods and services as a percentage of total spending also increased. From 2001 to 2011 this grew from 9.3% to 11.2%. Therefore, not only do we see a persistent but a growing passive consumerist society that over a time period of nearly 100 years was fabricated through Freudian psychoanalysis.

Bottom line: We are still passive consumers in society, influenced through the theories of psychoanalytic thinkers.

* Please help my Growth & Development Economics students by commenting on unclear analysis, alternative perspectives, data sources, etc. (Or you can just say something nice 🙂

Review: How Rivers Made America

Martin Doyle’s 2018 The Source: How Rivers Made America and America Remade Its Rivers educates you on politics, economics, technology and society by telling you the history of how rivers defined America’s development in five areas: Federalism, Sovereignty & Property, Taxation, Regulation and Conservation.

As usual, I will provide a series of notes and thoughts that came up while I was reading rather than a chapter-by-chapter summary of the book. 

1. Rivers in the New World had important recent impacts compared to rivers  the Old World has known for millennia. These impacts came as white settlers displaced First Nations with their technology, expectations and institutions. In some cases, those paradigms were helpful (e.g., shipping or producing power), but most focussed on short-term profit (e.g., pollution, depletion, and deviation) over long-run sustainability.

2. Rivers played a major role in economic and political development. Settlers used rivers to explore the vast country, ship goods from the frontier to the settled East, and join growing cities into what became — before rail roads — a national market.

3. Plenty of companies went broke trying to take over shipping routes, build canals, etc. Their troubles often undermined state finances, which forced states to set strict budgets and the Federal government to get involved in unforeseen and increasingly invasive ways. These origins explain why the US Army Corps of Engineers plays such a big role in building dams, “controlling” rivers, and settling flood plains.

4. Shipping companies lobbied against tolls on rivers, which aided navigation and lowered shipping costs, but also shifted their private costs onto society. These subsidies and distortions grew in 1860s (when the Swamp Acts encouraged settlement in wetlands) and 1930s (when jobs mattered more than productivity).

5. Technology and ideology jointly destroyed any notion that rivers should be left to their own course and flow:

…the 1930s were the apex of the Progressive Era, when leaders were enamored with systems planning, optimization, and engineering… which meant that a central agency—the Corps of Engineers—had to be in charge of planning, engineering, and coordinating. [snip] In the late twentieth century, flood control infrastructure had created an enormous sense of hydrologic security. But it also unintentionally created a perverse incentive that drew people into areas previously considered too high risk for developing. [Locations 1077 and 1224]

6. A small step in Federal involvement often led to massive influence, spending and harm. In 1950 disaster relief meant repairing a local, flood-damaged bridge. By 1988, the Stafford Act “explicitly prohibited the use of ‘arithmetic formulae’ (such as benefit-cost analysis) as a basis for disaster declarations. Disaster relief became codified as a solely political decision, outside traditional economic evaluation.” [Location 1254] The resulting flood of federal money meant that locals didn’t have to pay for recovery, which encouraged “moral hazard” (i.e., ignoring risks) and thus larger  disasters.

7. When Doyle goes west, frontier mentalities clash with historic institutions, and miscalculations multiply:

…water in the West is a zero-sum game. The tribes can’t keep enough water in the river to sustain the salmon if the farmers upstream divert all the water they need for crops and cattle. Someone has to lose. [snip] Downstream groups inevitably prefer rights based on historic use, like those outlined in the appropriation doctrine. For their part, upstream users tend to prefer rights based on contribution to river flow, like those of the riparian doctrine. [snip] In 1976, Stockton and Jacoby showed that the decades of data used to estimate flow on the Colorado River and then divvy it up in the Colorado Compact were in fact the wettest years in half a millennium. The basis of the Colorado Compact was an estimated mean annual flow of somewhere around 16.5 MAF per year; tree-ring data over a much longer period of time suggested that a more realistic estimate would be about 3 MAF per year less than that [meaning the CC is flawed]. [Locations 1598, 1761 and 2121]

8. A tradition of cleaning drinking water (“my problem”) but not sewage (“your problem”) led to public health disasters in the late 19th century and an ongoing battle over water quality that continues to this day. Too few polluters pay, so public waters are often abused in ways that laws allow but the public (if asked) would never support.

9. We can see the switch from local to federal control in the tax system:

In 1902 local government tax revenues exceeded state revenues by 260 percent and national government revenues by almost 40 percent. [snip] Because local city governments bore the burden of providing most services in the early twentieth century, by 1902, property taxes accounted for 42 percent of all government revenues (national, state, and local levels combined). [snip] Before the Depression, there was general consensus that federal funds should be spent only on projects of national need, and local funds would be spent on projects of local interest. Property taxes would be linked to municipal projects, tariff taxes to national projects. But the New Deal created a fiscal system through which the federal government collected income taxes nationally and then spent that revenue via grants to state and local governments—an enormous redistribution of funds and government power across the country. [Locations 2543, 2571, and 2702]

10. Women played a big role in promoting water quality. Although it’s clear that Rachel Carson’s Silent Spring raised awareness, it was the efforts of thousands of women across the country that brought laws and funding, but not an end to the problems:

Even FDR’s New Deal, with its expansive building programs, had been minor compared to the spending spurred by the Clean Water Act. In the first twelve years after the act was passed, the federal government spent over $40 billion on wastewater treatment. [snip] For all the benefits of the Clean Water Act, it had an enormous blind spot: Farmers and suburbanites with Irish-green lawns were let off the hook. When a farmer fertilizes a field, or a homeowner uses a bag of fertilizer from the local garden store, they play a role in changing the chemistry of the planet. [snip] By the turn of the twenty-first century, the EPA had classified just under half of the 3 million river and stream miles in the United States as either threatened or impaired, and the cause was fertilizer from agricultural and suburban runoff. [snip] by 1991 the federal share of spending on wastewater infrastructure had dropped to 5 percent. This was a jarring reality for local governments, which suddenly faced the reality of paying for the requirements of the Clean Water Act on their own dime.  [Locations 2852, 2867, 2897 and 2928]

11. The plethora of special-interest districts with poor governance, vague goals and taxing authority resulted in projects that were bad or ruined via corruption and amateur errors (e.g., Flint).

12. America’s obsession with profits (and relaxed view towards the damages resulting from those profits) can be traced to the water-powered mills that turned from grinding grain to generating electricity in an assault on property rights that eventually backfired:

…the desire for economic progress in the early nineteenth century was so strong that it shifted government regulation from favoring established property to supporting whichever use best served economic development. Thus, with the government’s encouragement, dams and mills proliferated in number, complexity, and economic output. As a result, textile manufacturing via hydropower in America quickly surpassed that in England. [snip] When a private power company built a dam or a steam power plant, it had to recoup all those construction costs through higher rates. But when the TVA [Tennessee Valley Authority] built a dam, the federal government covered some of the costs in the name of broader public interest such as navigation and flood control. This support reduced the cost of power generation and thus reduced the rates TVA needed to charge, so Lilienthal could set far lower power rates than his for-profit private power competitors could afford. [Locations 3173 and 3406]

13. The TVA used to be pretty good. Then it got too big.

14. It took decades of mistakes and wasted effort before “in-channel river restoration” was replaced by allowing the river to move and evolve. Sadly, many rivers are handicapped by Army Corps barriers protecting farms and towns built in flood plains. 

Meanders like those seen in the Mississippi, with their varied flows, depths, and sediments, are considered by ecologists to be the root of the extremely high biodiversity of rivers. Physical diversity begets biological diversity. Yet there are few reasons for industrial society to tolerate meandering rivers [snip] Rivers could be taken from complex, unruly tangles of swamps and floodplains and converted into straight, linear, trapezoidal forms. Channelization made rivers rational. These benefits, however, came with enormous impacts and losses to ecosystems. From destroying fish habitats to eroding banks, channelization inflicted ecological havoc. [Locations 3826 & 3844]

15. A combination of naive-optimism and broker lobbying led to the creation of a market for “river offsets” that would encourage river restoration as a way to pay for destruction elsewhere. This system looked successful on paper, but its emphasis on quantity meant that quality, let alone sustainability, was ignored. 

16. The best way to restore a river is to leave it to flow in its own bed according to seasonal variations, with its own mix of flora and fauna. #CaptainFuckingObvious

My one-handed conclusion is that this book provides a welcome portrait of the many ways that rivers shaped — and were shaped by — America’s urban development and environmental condition. I highly recommend it, and thank JT for the tip.

Read all my reviews here.

Stuff to read

  1. The ongoing impacts of China’s refusal to accept American garbage
  2. Edinburgh is charging a tourist tax (£2/head/night) to offset congestion. I think Amsterdam needs to charge €10/head/night.
  3. An update on meat substitutes (looking good)
  4. No, You Can’t Ignore Email. It’s Rude” (I agree with these reasons)
  5. Living without Apple, Amazon, Facebook, Google, and Microsoft
  6. The military lost the war in Afghanistan
  7. Touch in China is disappearing…
  8. Pokemon Go is the first stage of our entry to the Matrix.
  9. Chris Anderson (TED) on community, ideas and our future as humans.
  10. Jaron Lanier on where Silicon Valley went wrong (and many other ideas)


Jive Talking launches

I started thinking about doing a podcast last year because I wanted to find a new way of learning, catching up with people in my network, and bringing new ideas to people. I still like blogging (and will continue to write here), but podcasting provides a different perspective, most obviously because it allows conversation.

I “soft launched” Jive Talking about one month ago with five interviews. In the past few weeks, I have had time to fix up the Soundcloud page hosting the podcast* and put a bit more time into improving “production quality.” I still have a long way to go before I am happy with these details (listen to my intro!), but they are not as important as the conversations, which are unscripted and free to flow wherever we wonder (and wander). I am not alone in liking this element to podcasting:

One of the things that’s so cool about the new media technology is that people want . . . They just want direct communication. They don’t like high-level production values, all to people on YouTube, and they’re very savvy media consumers. A highly produced television show just looks like a lie. If you’ve got something to say, they just want you to sit down and say it. They don’t even want you to edit it so that it’s smoother because that just looks like you’re spinning the content, and you probably are.

My one-handed conclusion is that you’re not going to learn anything until you try something new, so here goes! Please listen to a few episodes, tell me what you think, and/or suggest new guests (including you!)

01 // What do we mean by water privatization?
02 // Monja Esterhuizen on losing less water in South Africa
03 // Delton Chen on incentivizing carbon mitigation
04 // Marina Della Giusta on #metoo, teaching economics, and careers for millennials
05 // Walter E. Block on pollution, regulation, and libertarian ideals
06 // Michelle Wilbur on small-scale renewables, oil and living in Alaska

* Jive Talking is now syndicated via Stitcher. I’ll get Apple iTunes and Google Play links soon!

Stuff to read

  1. “Russia Is a Rogue, Not a Peer; China Is a Peer, Not a Rogue”
  2. How America welcomed Russian kleptocrats (and domestic corruption)
  3. A nice discussion of Core Economics and the quest to make economics more useful (realistic) to students.
  4. Dear Mr Zuckerberg: the problem isn’t the internet, it’s Facebook
  5. This book review on the varying and pervasive impacts of climate change leads me to think that we are moving from a world dominated by the “information revolution” (the one displacing the industrial revolution) to one dominated by the “climate revolution,” which is — as all good revolutions do — overturning our ways of living. The sad part is that most of the climate-driven change will be unpleasant, expect perhaps for those who swap reality for a virtual lifestyle (ironically, and too late, reducing the footprint of their consumption).
  6. The pay gap between skilled and unskilled workers is growing dramatically in the US. The need for basic income (as a way of preventing rebellion) is rising.
  7. Data trackers and advertiser don’t even know what they’re doing.
  8.  Interacting environmental problems mean more, worse crises.
  9. Heineken’s behavior depends on local norms (of sexual harassment)?
  10. Will these guys save the world by sucking out carbon? (Carbon tax!)

H/T to MdG

We understand money pretty good.

I’ve always nodded my head at the truth in Upton Sinclair’s insight that “It is difficult to get a man to understand something, when his salary depends upon his not understanding it!” but I recently realized its importance in the quest for sustainability.

It’s clear that many people who make their living from “freeing carbon” (oil workers, loggers, car makers, beef producers, etc.) are not interested in ideas about limiting carbon (and equivalents). As a result, we’re getting climate change and damages of $100 for each $1 these “vested interests” earn.

So now I realize the sad possibility that many of these vested interests — had they saved some of their “carbon windfall” — would be ok with a decarbonising world. That would be because their savings gave them other options for earning, and enjoying, their lives.

Compare Norway and Alberta (or Alaska). Norway saved and invested lots of its oil money, so it now has $1 trillion, or about $185k per citizen. Alberta and Alaska, I know, have saved a lot less. This difference in savings is important because savings make it easier to cope with risk. Norwegians would not be so worried if the “oil carbon was turned off.” Alaskans, Albertans, and the residents of most oil- carbon-exporting countries (including the US) would be terrified, because they make their living from freeing carbon.

It is thus that I arrive at my over-simplified, one-handed conclusion: If we’re going to turn off the  carbon, then we need to “take care” of those who profit from it. The simplest way to do this is pay them off. The easiest way to raise the funds to pay them off is to tax carbon. I would make the tax “dynamic” such that the burden fell for those who ran from carbon while it rose on those who strolled in the same general direction. 

It’s not about the planet, the future or technology. It’s about money.

Stuff to read

  1. Aeromexico helps Americans “get over the wall”
  2. (Government-sponsored) fake news in Hungary is pretty weird.
  3. Utilities (once “safe as houses”) are under pressure from climate change
  4. How Google sells ads (and Facebook sells promise) Related: Zuckerberg says people want targeted ads. He’s wrong.
  5. Patriots are better than nationalists. Related: The history of flags
  6. The Dutch need a carbon tax if they’re serious about meeting their Paris commitment.
  7. Should leisure be taxed to force young men to work rather than play games?
  8. Anand Giridharadas takes the piss, posing as #DavosMan
  9. Peter Thiel has some great ideas on markets.
  10. Poverty isn’t increasing if you consider how colonialism immiserated “poor” but free peoples. Related: Colonialism is only another form of free-riding on the wealth of others (or our future)

H/Ts to PB and RN

The air we breathe

I grew up in San Francisco and Los Angeles in the 1970s, when gasoline was leaded (thus damaging brains and increasing crime), and pollution from cars and industry much worse than it is today. (Read about changes in LA from the 70s, improvements for kids since the 90s, SF’s improvements since the 60s, and the recent dangers of inhaling smoke from wildfires.)

As a water economist, I am well aware of the advantages of clean water, which gives me a similar respect for clean air. The problem is that it’s hard to see air or water pollution, which is why I support visualizing technology. 

In the case of water, we’re still waiting, but the technology* for measuring, viewing and recording air quality is improving rapidly, which makes it more likely that average people will change their habits and push for policy changes that can be seen on their devices. (Here’s a great podcast on how residents of a poor area near San Francisco dramatically improved their air quality. Pollution in London’s Tube is 30x street levels, so maybe it’s time to bike?)

Delivery scooter in Bangkok market alley

With that preamble out of the way, let me tell you about the Air Tricorder (!) I bought for €70 in Chiang Mai, Thailand.

As you can see, it’s a plastic box with fans and sensors inside that gives real time measures of the Air Quality Index (AQI) that combines measures for PM2.5, PM10 and NOx. (This video shows how quality changes as a freight train rolls through Utrecht’s central station.) The drawbacks of the Tricorder is that it does not record geo-tagged data, which means that you need to stop often and manually correlate location and time with the AQI.**

What I found to be very interesting was how AQI would change in various places, sometimes counterintuitively.

First is the fact that AQI in an alley may be lower than on a busy street, either because scooters drive in the alleys or people are cooking over charcoal (!!) in the alley. (The Tricorder doesn’t go above 500, which is labeled “ludicrous.) Those cooking habits — along with burning wood in the fireplace or smoking indoors — explain why indoor air pollution is linked to 4,000 deaths per day, worldwide.

Hazardous air INSIDE the theatre?

Second, polluted air doesn’t just “stay outside,” and it can even be worse than outside if inside air is not circulated or filtered (see photo). China’s leaders know this, which is why they have dozens of machines scrubbing the air of their homes and workplaces in polluted Beijing.*** 

Third, the majority of pollution comes from bad practices (burning coal) but also old, outdated and poorly maintained machines and factories. Various countries regulate this issue by banning certain practices or older models of cars, scooters, trucks and so forth, but poor/corrupt countries do not have or enforce these rules, which means that their citizens die younger and children suffer brain damage. Is that policy pro-poor? Probably not, given that their richer neighbors use more energy and travel more

My one-handed conclusion is that you should check your personal air quality and speak out for policies and practices that will improve it.

* Note that I am talking about mobile or personal devices. You can easily get quality measurements from fixed stations (US or EU), but that information is less personal (and thus less actionable) because it’s not about you here and now.

** I was super excited to buy a Flow device that would send real time data to my smart phone, but the €180 device bricked itself when I tried to share it with my GF’s phone. (Flow was funded in late 2018 via Kickstarter.) Two weeks later, I am still waiting for a solution. Their tech support seems to be struggling. I’ll update this post if get a working device (or my money back).

***  This famous twitter account, set up by the US Dept of State in 2008 — back when we were great — forced Chinese leaders to engage with the problem.

Addendum (28 Feb): Living with Bangkok’s dirty air

Recommended reading

  1. A podcast on tribe and belonging (in contrast to “neoliberal” life)
  2. Ethereum (a crypto-currency) will cut its energy use by 99 percent.
  3. China’s share-bike schemes are crashing and burning
  4. The podcast revolution is here to stay.
  5. A profile of the Chinese who censor the country
  6. Read this review of Surveillance capitalism: “Behavior modification is the thread that ties today’s search engines, social networks, and smartphone trackers to tomorrow’s facial-recognition systems, emotion-detection sensors, and artificial-intelligence bots. What the industries of the future will seek to manufacture is the self.” Related: Facebook knows everything about you when it sells adverts but not when politicians are asking about manipulation. I’m betting they are lying about how much they know and don’t know.
  7. Your friends may not be happy is you try to live without a smart phone.
  8. Forget counting calories. Eat good food.
  9. People have a hard time understanding logic and data. That doesn’t mean — IMO — that they should be voting on policies that affect the rest of us.
  10. How the Ostrom School limited Tragedies of the Commons