5 Lessons on the Consumer Economy from Marketplace's Series, 'Consumed'

Last week, the radio show Marketplace explored “How we consume, what we get from it, what it costs and whether we can keep it up,” in a weekly series entitled Consumed.

“This series,” explained Marketplace’s host Kai Ryssdal, “is all about whether consumer economy is sustainable on every single level, for businesses, for consumers and for the people who work in it.”

With such a premise, I couldn’t help but listen to Marketplace all week. The series didn’t disappoint and besides providing a great example of what public radio is all about, it also gave me some food for thought. Here are some of the more interesting lessons I’ve learned from it:

Day 1: Learn from Betty Blue, not from Adam Smith

On the first day of the series, Kai Ryssdal talked with P.J. O'Rourke, a political satirist and an expert on Adam Smith,  the 18th century Scottish economist and philosopher who is considered by many the father of modern economics, mainly due to his 1776 book "The Wealth of Nations", where he presented the idea that economic progress depends upon three individual prerogatives: The pursuit of self-interest, the division of labor, and the freedom of trade.

The conversation was on the relevance of Smith's ideas for today’s consumer economy, including whether Smith’s perception - that if all people pursue their own interests the common good will advance - still has merits. Neither Ryssdal nor O’Rourke thought so. "If you talk to most businessmen, they'll say that what they do is for the public good, but you know they're just greedy," O'Rourke said, "and consumers are just consuming for the sake of their own greed.”

Ryssdal had another explanation in mind. In another segment, he went to a hardware store to buy some stuff he needed and found himself looking at new grills, though he really didn’t need a new one. So why was he looking at the grills? Simply because they’re there, he explains. “That’s so much what happens in this economy, right? We have the choice, we pursue it and thus we consume.”

Is it possible that the problem is just our inability to resist temptation? If so, maybe we can learn something from the 1986 French film Betty Blue, where the actor Jean-Hugues Anglade explains to his neighbor’s wife why he resists her seductive offers. “Sometimes I resist my desires in order to feel I’m free,” he says. So maybe it’s time to update Adam Smith's metaphor of "invisible hand" to the "invisible resisting hand," which will make sure we only buy what we need.

Day 2: Advice for CEOs: Think of your grandchildren, not the next quarter

Day 2 looked at companies and how their focus on constant growth and shareholder value impact the consumer economy. This them was best emphasized by an in-depth interview with none other than Paul Polman, the CEO of Unilever, who explained how his company addresses these issues.

In the interview, Kai Ryssdal asked Polman a tricky question, "Who do you feel more responsible to - your grandchildren or your shareholders?" To that, Polman had a clear answer, "My grandchildren, without a doubt." Does that mean that he prefers stakeholders over shareholders? Not really.

Polman explained, “The debate always tries to polarize – we cannot do one versus the other. There’s absolutely no reason why you cannot maximize shareholder value while at the same time also caring for the other stakeholders. In fact, we would submit at Unilever that these two go hand-in-hand…you cannot have a successful healthy business model if you don’t also create a healthy environment. Business has a very hard time succeeding in societies that fail…and the data is evident that using up our scarce resources is also an enormous cost of business.”

Hopefully other CEOs took a note of that.

Day 3: Millennials’ hurdles provide hope for a better future

Day 3 made the case that millennials have hard time participating in the consumer economy not because they don’t want to, but because they can’t afford it, as well-paid, full-time jobs with benefits are hard to come by for many millennials.
Basing your livelihood on a “patchwork quilt of part-time jobs” has many downsides, but there’s also an upside. The need to be more frugal and to look for alternatives to traditional consumption (sharing economy, for example) might seem like a bummer, but it can actually become the foundation of a better and more prosperous future for this generation. If these experiences shape millenials' consciousness and impact their behavior even when they finally get their full-time jobs, then a sustainable future might be within reach.

Day 4: Bubbles forever

Day 4 was mostly about bubbles, a phenomenon with a long history that was explained by Prof. Joesph  Stiglitz as follows: "If the reason the price is high today is only because investors believe that the selling price will be high tomorrow — when 'fundamental' factors do not seem to justify such a price — then a bubble exists."

The main story was on a bubble that took place in Eastern Montana 100 years ago, as well as its similarities to the latest housing bubble. The lesson I found here is that maybe we shouldn’t be that surprised when we experience bubbles – after all, they’re the result of human nature, not force majeure and while times and circumstances may change, it seems like greed and hope, the human forces behind bubbles, will never go away.

Day 5: The real cost of consumerism

On the last day, Adriene Hill and David Weinberg from Marketplace’s sustainability desk (which was responsible for the series) did a great segment on the evolution of the society from a “market economy, to being a market society where everything is for sale.”

They talked with Harvard Prof. Michael Sandel on what might be one of the more troubling costs of consumerism – what it does to us as a society. Prof. Sandel explained it:

Democracy doesn’t require perfect equality, but it does require that men and women from different backgrounds, different walks of life, encounter one another, bump up against one another in the course of ordinary life. Because this is what gives us a sense that we are all in this together -- that sense of being engaged in a common project. Without that experience of a shared civic life, it’s very difficult to think and act as democratic citizens.

So isn’t it time to say goodbye to the consumer economy before it’s too late? I sure thought so after the series ended. How about you?

[Image credit: APM: Marketplace]

Raz Godelnik is the co-founder of Eco-Libris and an adjunct faculty at the University of Delaware’s Business School, CUNY SPS and the Parsons The New School for Design, teaching courses in green business, sustainable design and new product development. You can follow Raz on Twitter.