Tuesday, December 29, 2009

Do the Wealthy Have an Obligation to Spend Less Conspicuously?

The economic crisis has put a break in America’s consumption culture to put it mildly. And that is not just because people don’t want to spend their money on the latest gadgets, it’s also because they can’t. Credit has frozen up meaning that people can’t charge that plasma TV for the time being.

But before, a nice house, car, and vacations to Hawaii were becoming a norm. The reason is rich people. The top 5% of the population has far more control over setting norms than say the middle 50%. Popular TV shows like Sex and the City were replete with wealthy people living the good life. When people go to malls, they see wives of corporate lawyers and investment bankers buying the latest handbags and fur coats from department stores. Sooner or later, people think they should have those things too.

Now, people have always wanted to imitate the wealthy to some degree. But that desire has gotten more acute in the past several years for two reasons. First, there is a proliferation of information about the wealthy and famous on blogs and news shows that didn’t exist before. People can find out exactly what new car some actor is driving, and how much his new mansion cost to build. Second, increased use of credit has made it possible for the middle and working class to imitate the wealthy…at least until the month’s credit card bill comes due.

What is the solution? Perhaps having wealthy people be less conspicuous about their consumption would be a start. Now, you might say the wealthy earned their money, and are entitled to spend it as they see fit. Putting aside people who inherited the money because of someone else’s work—a substantial number of people—it is true that people can spend their money how they want within reason. But saying that people have a right to do something is different from saying that doing a certain action is desirable or even right in the first place.

Wealthy people have influence over how everyone else perceives the world around them. Maybe that shouldn’t be the case, but it is unfortunately. The wealthy may even have a moral obligation to tone down the consumption. Take a professional athlete. He gets paid millions of dollars a year for playing a game. Or the wife of the corporate CEO who doesn’t work. She’s not doing anything great, but she still gets a nice mansion and vacations whenever she wants them. The point here is not to denigrate these people or say they should feel bad for their wealth. But surely with all privilege those people get, some responsibility comes. And if the wealthy and famous stop the hyper consumption, it’s a signal to everyone else they should stop to.

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