Source Jim Devine
Date 09/07/30/14:01

The New York Times
Letter from America
Why 'Cheap' May Really Be Expensive

NEW YORK — The other day, Ellen Ruppel Shell was listening on the
radio to the chief executive of a Boston advertising company talk
about how the economic downturn had forced him to impose pay cuts
throughout the company he ran, including on himself.

“He talked about how he and his wife had looked over the family budget
and figured they could manage a 10 percent pay cut, by rethinking some
of their purchases and making a few adjustments, like delaying a
vacation,” Ms. Ruppel Shell said. “This is in marked contrast with
what the C.E.O. of an advertising company would have said a few years

Ms. Ruppel Shell was agreeing with a comment that I’d made, which is
that it’s become acceptable, even fashionable, in the wake of the
economic crisis, to go for a bit of conspicuous economizing, rather
than conspicuous consumption.

“I think that people are now a little embarrassed to lead the high
life, at least publicly,” Ms. Ruppel Shell said.

Ms. Ruppel Shell, a correspondent for The Atlantic and an occasional
contributor to The New York Times, has written a book about what she
calls “America’s dangerous liaison with Cheap,” and her timing, during
the worst financial crisis in living memory, couldn’t be better.

But this is not a book that will tell you how to get by or to save
money. Her book, “Cheap: The High Cost of Discount Culture,” carries
what might seem at first glance to be a counterintuitive message: Far
from making economic sense, the American obsession with cheap goods —
the craze for bargains, discounts, factory outlets and Wal-Mart — is
actually bad both for the planet and the individual shopper.

“Cheap fuel, cheap loans, cheap consumer goods do not pave the road to
salvation,” Ms. Ruppel Shell writes in her opening chapter. “The
economics of Cheap cramps innovation, contributes to the decline of
once flourishing industries, and threatens our proud heritage of

It has, in Ms. Ruppel Shell’s view, spiritual and moral consequences
as well: “The ennoblement of Cheap marks a radical departure in
American culture and a titanic shift in our national priorities,” she

Cheap used to be associated with shoddiness and stinginess, an absence
of style and craftsmanship. Now buying cheap is fashionable and even
gives a sense of power. Factory outlets, she says, are America’s No.1
tourist destination. We buy without needing to because some things
seem cheap. It’s a way, Ms. Ruppel Shell writes, “to wrestle control
from the baffling mystery that is retail.”

Moreover, Ms. Ruppel Shell argues, there’s a pervasive social effect
of Cheap, though one that’s generally invisible to the consumer, whose
interest is making ends meet. The money saved has to come from
somewhere or somebody: from cheap labor, materials procured without
regard for the environment, or just the lower quality of the product
itself. Nothing, in this sense, is really cheap. Somebody is paying

Needless to say, not everybody agrees with this. Indeed, Ms. Ruppel
Shell’s ideas run directly contrary to the powerful, even dominant
opposing idea, which is that globalization, economies of scale, and
factories in China make many goods affordable for people who wouldn’t
be able to afford them otherwise. Anyway, you can’t stop the engine of
economic change, which now goes by the name globalization, any more
than you could have stopped the automobile from replacing the horse
and buggy a hundred years ago.

Still, clearly, if the frequency of Ms. Ruppel Shell’s appearances on
talk radio and elsewhere are any indication, she has struck a nerve.

“I thought I would get a lot of anger,” she said. “I feared that the
book might get misrepresented as an elitist argument that people
should buy only high-end, expensive stuff, but that’s not at all what
I’m saying. I’m arguing that the discount culture has created a false
dichotomy between quality and price that has made quality goods
unnecessarily expensive.”

There are several arguments here: for one, the discount marketers have
developed an arsenal of techniques to make you buy what you think is
cheap but might not actually be cheap. People don’t know the prices of
most things, so they assume they’re getting bargains in stores like
Wal-Mart, but sometimes they’re not.

Then there are the various psychological marketing ploys, the
creation, for example, of what Ms. Ruppel Shell calls “cheap chic,”
the concept that made the furniture retailer Ikea, about which Ms.
Ruppel Shell is very critical, a global brand, with stores in 52

Wal-Mart “can’t escape its downscale connotations,” she writes, but
through clever image-making, Ikea succeeded in making itself appear to
be the place where “value and good values coexist.” In fact, according
to Ms. Ruppel Shell, who visited Ikea’s headquarters In Sweden, Ikea
relies on cheap labor and illegal forestry practices in Eastern Europe
and Russia to keep its prices down, and keeping prices down is

Objections can be raised to this as well. Probably, people in 52
countries haven’t been buying Ikea only because of its “sly, ironic
commercials, its conspicuously progressive outlook,” but because
they’ve found it to be a reasonable combination of style and price.

Ms. Ruppel Shell complains about Billy bookcases, one of Ikea’s
signature products, on the ground that you have to keep your heavy
books on the ends of the shelves to keep them from sagging, but I’ve
had Billy bookcases for years, and they were affordable and mine
haven’t sagged. (On the other hand, lots of Ikea stuff is, let’s face
it, cheap and flimsy.)

Ms. Ruppel Shell has also been criticized in some reviews for having
unconvincing solutions to the problem she so effectively describes.
Her reply: “I don’t offer a policy solution because I don’t think it’s
realistic. I don’t see price controls and/or tariffs as part of our
future, nor do I think they should be. I believe in free trade — but
to me, free trade does not necessarily have to entail stalking the
globe for cheap resources and cheap labor made possible by the absence
or near-absence of the rule of law. I believe in the power of
knowledge to change behavior.”


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