IS KEEPING UP WITH THE JONESES KILLING US?
THE OVERSPENT AMERICAN
The tableau was at once absurd and sad--but not altogether surprising. We are, after all, a nation of accomplished spenders, slaves to advertising and status symbolism. The conspicuous fruits of our consumption shout out our aspirations and insecurities.
This is the phenomenon Juliet Schor explores in The Overspent American. Schor, a Harvard University economist, has delivered what amounts to a sequel to her breakthrough 1992 study, The Overworked American. That book, justifiably embraced as gospel by the human-resources intelligentsia, expertly documented the time squeeze faced by two-income families as hours on the job expanded. Americans' leisure time, Schor demonstrated, was vanishing.
Why are we killing ourselves this way? In large part, Schor argues now, we work so that we might spend. Americans are engaged in an intensifying ''national shopping spree'' rooted in competitive emulation--keeping up with the Joneses on a manic scale. ''We are impoverishing ourselves,'' she writes, ''in pursuit of a consumption goal that is inherently unachievable.''
Corrosive consumerism, of course, has existed as long as envy and avarice. Look at the pharaohs' pyramids. And much of Schor's evidence of its current manifestation will seem blatantly familiar to anyone with a TV, a car, or kids. (Example: ''The coolest [teen] brands are often fashion brands or 'badge items' that kids can wear and relay a message about themselves.'' Like, duh.)
But Schor argues that, in the late 20th century, competitive spending has intensified insidiously. In part, that's because the gap between rich and poor has widened, creating a highly visible class of superwealthy who set outrageous spending precedents for everyone else. At the same time, TV ads, not to mention the programs they punctuate, have brought images of Lexuses and Rolexes, directed at the rich, to the gazes of average Joes. So designer cosmetics are now the middle-class norm, and two cars in the driveway (one a sport-ute, naturally) a necessity.
This theory is difficult to confirm. Like much of Schor's book, it relies on logical leaps and readers' gut-instinct acceptance. True, per capita spending has swelled for decades, but at a lower rate now than in the 1960s, before two-income families proliferated. Moreover, when asked in a Roper poll how much income a family of four needs to live ''in reasonable comfort,'' Americans' responses since 1978 have trailed inflation. In any case, Schor never proves a connection to the wealth gap. Likewise, she can't show that the number of ''downshifters''--those who escape the trend by working and buying less--is any greater than a generation ago. It's unfortunate: The study lacks the empirical validation that made The Overworked American so compelling.
The Overspent American is strongest when it employs imaginative economic analysis to show us the inner workings of our materialism. There is, for example, Schor's examination of personal savings from her survey of 834 workers at ''Telecom,'' a large, Southern telecommunications company.
Employees were asked to identify a group of ''Joneses''--people in their lives who were a primary reference for social comparison. Then they were asked to compare their financial status with that of the Joneses. On average, people who said they were worse off saved $2,953 a year less than those who picked a reference group of similar means. Trying to keep up with Joneses richer than ourselves, in other words, knocks spending out of whack.
Other factors have surprising effects on savings rates, Schor finds. Better-educated respondents tended to save less. (She guesses that such folks are more status-oriented, but admits ''it's hard to say why.'') So did ardent TV watchers. Each hour Telecom workers spent glued to the tube reduced annual savings by $208. (Schor's unsubstantiated interpretation: ''What we see on TV inflates our sense of what's normal.'')
Such analyses, while flawed, show the economic and social downsides of the ''consumer escalator.'' Much of our spending clearly is unnecessary or wasteful, raising troubling moral questions. Moreover, the uphill pursuit of material nirvana is stressing us out. Amid widespread wealth, most Americans aren't content with their lives.
Is that such a terrible thing? I'm ambivalent. Ambition, dissatisfaction with the status quo, a desire to improve our lots and those of our children--these are profoundly American, if not universal, traits. They have driven us to stunning accomplishments and global leadership, and few would want the alternative of complacency and stasis. Yet we spend more than we should on Armani and OshKosh B'gosh, and it's making us crazy. Schor would have us on a middle path, one that retains the ardor but loses the insanity. Perhaps it's worth a try.
BY KEITH H. HAMMONDS
Updated May 14, 1998 by bwwebmaster
Copyright 1998, Bloomberg L.P.