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September 28, 2006

The Rain-Soaked Purple of the White Birch in Spring

Robert Frank on economic possibilities for our grandchildren:

The More We Make, the Better We Want - New York Times: Productivity growth has raised living standards in the United States more than 40-fold since 1790.... John Maynard Keynes speculated about how the continuation of such spectacular productivity growth might transform our lives. Like many other distinguished thinkers, both before him and after, he predicted that people would have great difficulty filling their days once it became unnecessary to spend more than a token amount of time working.

This concern seems comical in retrospect....

How could Keynes, the most influential economist of the 20th century, have made such an absurd prediction? It would be one thing if he had merely overlooked the possibility of boundless human desire. Yet he explicitly considered this possibility, only to dismiss it.... [H]e wrote that human needs fall into two classes: basic, or absolute, needs, which are independent of what others have, and relative needs, which we feel "only if their satisfaction lifts us above, makes us feel superior to, our fellows." Keynes granted that although needs rooted in a desire for superiority might indeed be insatiable, this was not true of absolute needs. And seeing absolute needs as more important by far, he concluded, "A point may soon be reached, much sooner perhaps than we are all aware of, when these needs are satisfied in the sense that we prefer to devote our further energies to noneconomic purposes."

Keynes was surely correct that only a small fraction of total spending is prompted by the desire to flaunt one's superiority. He was profoundly mistaken, however, in seeing this desire as the only source of insatiable demands. Decisions to spend are also driven by perceptions of quality, the desire for which knows no bounds.... When a couple goes out for an anniversary dinner, for example, the thought of feeling superior to others probably never enters their minds. Their goal is just to share a memorable meal. But a memorable meal is a quintessentially relative concept. It is one that stands out from other meals. The standards that define a memorable meal are thus elastic.

When my wife and I were living in Paris a few years ago, we went out to dinner with well-to-do friends who were visiting from the United States. The restaurant we chose had a good reputation and, by our standards, was not cheap. But although my wife and I enjoyed our meals enormously, our friends found theirs disappointing. I'm confident they were not trying to impress us or make us feel inferior. By virtue of their substantially higher income, they had simply grown accustomed to a higher standard of cuisine.

There are no obvious limits to the escalation of quality standards. For example, dinner for two at Sketch in London can easily top $500, even if you choose the least expensive offering on the wine list....

By placing the desire to outdo others at the heart of his description of insatiable demands, Keynes relegated such demands to the periphery. But the desire for higher quality has no natural limits. Keynes and others were wrong to have imagined that a two-hour work week might someday enable us to buy everything we want. That hasn't happened and never will.

I can't quite pin down why I am dissatisfied with Robert Frank's argument over "quality" and "memorable experiences," and I don't see why the equilibrium should be twelve hours a day six days a week or eight hours a day five days a week rather than (except for those of us very lucky enough that lots of our work feels essentially like play) say, six hours a day four days a week.

Maybe I'll turn the mike over to Margo Timmins:

Have you ever seen a sight as beautiful
as that of the rain-soaked purple
of the white birch in spring?

Have you ever felt more fresh or wonderful
than on a warm fall night
under a Mackerel sky,
the smell of grapes on the wind?...

Have you ever had the pleasure of watching
a quiet winter's snow slowly gathering
like simple moments adding up?

Have you ever satisfied a gut feeling
to follow a dry dirt road that's beckoning you
to the heart of a shimmering summer's day?...

Have you ever seen a sight as beautiful
as a face in a crowd of people
that lights up just for you?...

Well I have known all these things
and the joys that they can bring
And now every morning there's a cup of coffee
and I wear your ring

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You know, in all this high falutin' talk about people's ability to choose how much they work, no one ever tells me how I can choose a part-time, adequately paying job. There are like, you know, none...

If I have worked 3-4 hours a day as a single mother of 2 and ben able to feed them and so on, I would have been ecstatic. I could have spent real time, not "quality" time, with them.

We deceive ourselves and become immorally obtuse when we allow ourselves to believe that everyone has the ability to make such choices.

Great, high-paying jobs tend to be pretty intensive in our society. In jobs involving reputation and skill, people want to be the best at what they do, and they want to be *considered* the best, and so they get in competition with others and the idea of working only six hours a day goes out the window. Anyone who opts for the "mommy track" knows they've given up on the game.

In dumb jobs, where six hours a day is preferable to eigth or ten or twelve, employers can cut wages, and so they do. Then everyone has to work more hours to make ends meet, even though they don't want to.

So it goes, as Kurt Vonnegut used to say.

But I do agree with that point about consumption having no limits. Many years ago I visited an exhibit at the NYC Met on "Arts of Mughal India" which included hand-knotted carpets made of pashmina. What an inconceivable (and unnecessary) luxury, my friend and I said at the time.

Lately a (different) friend bought a many-thousand dollar hand-knotted Tibetan rug, of silk and the kind of wool that comes off Tibetan sheep (same environment as pashmina, although not the same animal). One touch and I have to have one. So I'm trying to figure out the best way to score one on sale (they get marked down from $10,000 to $4,000, although of course there are smaller ones that are cheaper).

Availability turns an inconceivable luxury into a necessary one.

This morning there were monarch butterflies above the trees migrating south, and I watched, and that was all I wanted to do, watch.

Sort of Carol's point--I don't know why our compensation system is like it is, but it is that way. My rough algorithm is "for every 10 hours of work per week, hourly compensation doubles."

So at my company--the clerical workers work 35 hrs/week, and make $10 an hour ($20K). Low-level salaried work 40-45 and make $20 an hour ($40k-$50k). High-ranking workers work 50+ and make $40 and hour ($100k). Executives work 60+ hours and make $80+ and hour ($250k and way up).

"...(except for those of us very lucky enough that lots of our work feels essentially like play)..."

Karl Marx saw the positive side of capitalism in mechanisation and the creation of new "artificial" desires (yes, go read it carefully).

But the heart of his thinking addresses Brad's parenthetical remark. Is the feeling that work is freely undertaken a function of nothing but the end point worked at? Marx's claim is that this is not so. The "same" job is experienced differently under different social conditions.

Marx would say that point of increasing productivity is not to shift the equilibrium point between work and leisure, but rather to abolish the distinction between the two.

It is when economists take for granted distinctions such as between work and leisure that the Marxist critique that they "naturalise" capitalism has force. The belief that the distinction is "human nature" is naive. What is needed is anthropological, sociological, psychological, historical enquiry.

I am pretty surprised to hear this from Robert Frank, who's written a good book on most consumption being relative - to the Joneses, not to an abstract "standard of quality".

Because, well, *why* would people have a boundless desire for quality? It's often plainly obvious that spending more money won't get a person something that gives them more actual use. From Frank's book I remember the example of barbecues costing thousands of dollars. Unless you're a champion griller you'll get no significant benefit compared to one costing less than half as much.

The only benefit you get is having one better than other people have.

Perceptions of "quality" in many products, especially higher-end products, are driven by how they stack up relative to what everyone else has. And obviously costing more counts as higher quality even in the absence of any practical distinctions. From my own anecdotal experience, people who pay more for quality (or "quality") frequently don't have much idea of what they're actually buying.

It's a bit silly to say that buying expensive products isn't driven by *explicit* feelings of superiority (although it very often is a blatant status display, Frank needs to spend time with shallower people). Because you don't need to buy something with the direct intent to impress the most, just with the feeling that you shouldn't put up with an "inferior" product relative to what everyone else has.

Not to what's "available", because in the general marketplace that's determined by what everyone else has. I mean, think of the old psych experiment where people asked what kind of stereo they'd prefer to buy picked a more expensive model if they were presented with a model priced higher still. The availability of those various products on the actual market isn't abstract, it relies on people buying all those stereos at a high enough rate to keep them on the shelves.

Thanks for the poem. I just sent it to my wife at her work. I am the coffee donkey in the mornings.

Perhaps Keynes just couldn't imagine the shallowness of people in desiring more and more things over quality relationships and the non-material aspects of a good life.

And in his day, looking backward and speculating forward, who would want to imagine the greed and the continued drive towards social dominance and hierarchy? The whole point of understanding the suffering and struggles of the past is to put us into a position where needless struggle, suffering and social dominance plays less and less a role in our lives.

Maybe at heart he was just too good of a person.

Can't blame Keynes. Even though he clearly understood human weaknesses such as the desire to appear superior or instill envy the notion underlying theories such as Maslow's Pyramid, that human wants might simply keep ascending long after 'basic' wants were satisfied, would likely have struck him as frivolous or possibly even corrupt. And while he certainly was aware of advertising I'm not sure it would have occurred to him that wants themselves might be manufactured by a massive industry solely dedicated to that project.

"Consumer wants can have bizarre, frivolous, or even immoral origins, and an admirable case can still be made for a society that seeks to satisfy them. But the case cannot stand if it is the process of satisfying wants that create the wants." -John Kenneth Galbraith

Part of the problem is that, despite the rain-soaked purple and all that, life basically sucks; only we don’t notice how much it sucks until there is an expensive way to stop it from sucking. The best example is health care. Suffering from disease has always been a problem, and it has always been a potential problem for everyone, but it has also always been something that we prefer not to think about. But advancing medical technology forces us to think about it, because we have to make decisions about what kind of health care we are willing to pay for. And, quite rationally, we are willing to pay for quite a lot of health care (and to pay for it, potentially, by foregoing leisure that might otherwise have become available due to increased productivity). Yet improved health care doesn’t produce a major improvement in the apparent quality of life, because it only affects that part of life that we preferred to ignore in the first place.

Another issue is that both material consumption and the labor/leisure decision may have only relatively small parts in determining well-being. Increased leisure has some effect on happiness, but not such a large one; and increased material consumption has some effect on happiness, but not such a large one. So we continue making this minor tradeoff on terms that are always improving. But the 90% of life that doesn’t depend on leisure or consumption is just as bad, or just as good, as it has always been.

The really interesting sociological phenomenon in this thread is the uncritical contrast this thread has drawn between the world of man and that of nature.

This is not to be critical of Brad, but surely it is possible to take a more nuanced approach to the issue of relative welfare than resorting to hackneyed Jameseon landscapes as imagined alternatives to contemporary lifestyles.

The flight to nature is nothing but repackaged romantic pastoralism, and while it may be part of our literary heritage it is completely unconvincing as economic argument, and is as artificial an intellectual creation as Disneyland. As far as I can tell, nature as an object of aesthetic worship is as irrelevant to the vast majority of the working class (for whom trips out of the city are a luxury) as are holiday theme parks. Perhaps less so. And anyone fooling themselves otherwise is....

How many people reading this thread have taken pleasure out of even 3/5 of the things Margo Timmons celebrates in this poem?

Keynes had no illusions about human nature. In the essay he writes

"Yet there is no country and no people, I think, who can look forward to the age of leisure and of abundance without a dread. For we have been trained too long to strive and not to enjoy. It is a fearful problem for the ordinary person, with no special talents, to occupy himself, especially if he no longer has roots in the soil or in custom or in the beloved conventions of traditional society. To judge from the behavior and the achievements of the wealthy classes today in any quarter of the world, the outlook is very depressing! For these are, so to speak, our advance guard - those who are spying out the promised land for the rest of us and pitching their camp there. For they have most of them failed disastrously, so it seems to me - those who have an independent income but no associates or duties or ties -to solve the problem which has been set them."

The optimism he expresses later in the essay, I think, is really an attempt to persuade. This is the life we can have, if we change our ways. I don't think he was literally making a prediction. But I do think he was always hopeful that people would ultimately come to their senses about a lot of things, not just the "love of money" but economic policy, war and peace, and much more.

My favorite restaurant is kind of a hole-in-the-wall. The cooking is good though, and they know me. They know I need egg substitute and want fruit instead of hash-browns or coffee cake, even though both of them are really good.

I don't knock those who develop the more expensive tastes, I just ask them to remember that they developed those tastes. They weren't born with them.

My parents often told a story of the time when, before they had children, they lived in Alaska, and would go out at night to see the Northern Lights.

One night they were particularly beautiful, so they stopped by the neighbors to share it with them. "Come see the Northern Lights," they said. "Oh yes," was the reply, "we've seen them before."

There is now a substantial body of research (which I'm too lazy to find link for) showing that satisfaction tends to return to an equilibrium level for an individual. That is, getting that carpet won't keep you happy for long, nor will losing it cause prolonged suffering.

This claim assumes that a certain absolute level has been achieved. The income level for this seems to be about half the average level in the US.

A completely different thought. Brad, and commenters, show in this post that his (and their) values go beyond having more money.

Why then, do we insist that there's something the matter with Kansans who don't vote Democratic to enhance their own economic interests? Maybe appeals to their material welfare aren't what we should be making.

For example, I told a Libertarian friend of mine that I was in favor of Social Security as a defined benefit, rather than the private accounts because, "I'm not willing to see someone eat dog food in their old age because they happened to have made one bad financial decision."

He nodded, and said, "The rest flows from that." Not agreement, necessarily. He's a very hard case. But respect, definitely.

"Yet improved health care doesn’t produce a major improvement in the apparent quality of life, because it only affects that part of life that we preferred to ignore in the first place."

I don't think this is true. We Canadians are quite attached to our superior if imperfect health care, react quite strongly when it is eroded, and are always appreciative when we have the differences between us and US rubbed in our noses.

And I think anywhere when older people get better help than their parents got with similar problems, they appreciate it.

In "The Rebel Sell", Andrew Potter and Joseph Heath point out that "for some things to be cool, others must suck". I think that gets it right for quality as well as cool.

To point out the obvious, other people make people happy. In three ways relevant to this thread. First and most importantly, friends and family, wives and lovers, when not driving us insane are the source of the deepest, most profound joy. Second, there is more to work than pay, the workplace is for many the most important community in their lives, which is why getting the pink slip can be so devastating to some. Third, regarding wealth, what people really want is services: restaurants, butlers, I'll skip something obvious, household help, etc. And the capacity of the Average Joe to hire an Average Joe to do something hasn't really increased.

"I don't think this is true. We Canadians are quite attached to our superior if imperfect health care, react quite strongly when it is eroded, and are always appreciative when we have the differences between us and US rubbed in our noses."

Then that's a relative good, right? You wouldn't appreciate it nearly as much without the crappy US system next door.

As for the inexhaustibility of desire, I think Buddha had something to say about that.

One idea I haven't seen here but which is entirely possible is that we may have a limit in what we want, but that we simply haven't seen it yet. That is, there is a general limit, but that its so far beyond what we used to consider that limit that we are only now, for the richest in our society, approaching that limit.

Brad, as a fellow fan of Iain Banks, you might be able to flesh this idea out a little more.

My thinking is that simple sustanence isn't what we want, but we are beginning to approach the limits of what people in general will feel is 'good'. For example, rich in the first world today means many things. For the first time in human history, people are starting to 'be rich enough'. Where they are retiring at 30 or 40 years old with money enough to live. This is a new phenomonon. I appreciate the sentiment and thought in the original post, but for many, many people, we are beginning to reach that limit.

Maybe if the income distribution had stayed the way it was in the 50's, people would have chosen less work. Gourmet cooking (leisure) was the in thing then for the upper middle class, but now it seems to be gourmet eating out(service). As tom s pointed out "the capacity of the Average Joe to hire an Average Joe to do something hasn't really increased." But this is not true for the of the upper middle class, their capacity to hire an Average Joe has increased a lot. So the well off work more to buy the bargain services and the average Joe works more so he can afford the necessay services such as medial care and education that is provided by upper income people.
In Europe the income distribution is much flatter and they work less.

Two remarks:

1. Keynes died relatively young from problems that nowadays we would (expensively) treat.

2. Keynes's friends Leonard and Virginia Woolf's country house had no indoor plumbing until after she wrote a best-seller.

"Keynes and others **were wrong** to have imagined that a two-hour work week might someday enable us to buy everything we want. That hasn't happened and never will."

A Kantian categorical imperative for the world! From the New York Times, nonetheless. Is the article a command or an observation?

I think of the rice farmers who surround me who have eaten delicious steamed pumpkin with sticky rice and different flavours of ground chili peppers (nam pik), for breakfast, every morning, for hundreds of years, and are quite happy with their lot in life.

Every year, as the monsoons begin, they plant their rice in communal groups, and in the evening they sit down by the field and have a simple but sumptuous feast with a little rice whiskey. The sky and evening light is really something to behold during the monsoon, the air is so clean, the clouds swollen so large, sweeping overhead, reflected in the paddy fields.

These people are so different from all the city intellectuals who describe them. Most of them have adopted technology when they needed it. Few still use a water buffaloe, although a few went back to using one in the recent oil crisis. Even local school teachers and government officials have their own fields.

The system works and they are not averse to growth or economics. They adjust their life as they need to. Literally everyone owns a house, even the completely incompetent who can't even bring home a harvest of rice. My father-in-law who lives near the Lao border gets up at three in the morning and forages for mushrooms in the forest to support his family.

Meanwhile, the city of Chiang Rai, Thailand is full of Europeans on their annual month long holiday who also seem quite content with a humble life, perhaps not quite 2 hours a week worth.

The more stuff you own, the more your stuff owns you.

I've read that an American Indian tribe had a custom where members would give away all of their stuff and start over. Today we call that a garage sale and get more money to get more stuff.

By the way, if you can get to Christies' next week, you can buy original parts of the Star Trek set (original series) although Paul Allen already owns Captain Kirk's chair. Someday maybe Paul will have the world's highest quality garage sale.

And so it goes.

Re: In Europe the income distribution is much flatter and they work less.

The fact that European governments pretty much mandate that people work less (through guaranteed and generous vacations and a lower threshhold for overtime) probably has a lot to do with this.

Thoreau said: 'a man is as wealthy as the things he can do without.'

In an ancient Indian (Asian) moral code it was a virtue to hold only what you needed.

Re: The fact that European governments pretty much mandate that people work less (through guaranteed and generous vacations and a lower threshhold for overtime) probably has a lot to do with this.

European countries are democracies. Is there any political movement to repeal these laws? What do you think would happen if a US presidential canadate made passing such laws his central issue? In the 1950's there were effort by unions and others to lower the number of hours in the work week. I haven't heard anyone suggest this for decades.

Interesting discussion. Puts me in mind of Monster A/V cabling. Why, when I am in the market for such a product, am I so drawn to their offerings, even while a little voice inside shrieks "You fool! This is grotesquely overpriced!" The packaging? Looks awfully pretty.

"Possession is a great surrender. The more a man has, the more surely is he owned by what he has. Man, the possessor, runs from servitude to servitude. He seeks to rid himself of one encumbrance only that he may be free to embrace the burden of another. Land, houses, money--he must serve their growth, their numbers, their exactions. Freedom is only the right to seek a further bondage."
Howard O'Hagan

I used to like to watch butterflies, just as Anne does, but someone bought them and now I have to pay to see them. Oh well, I'm too busy at work to watch butterflies anyway...maybe I can get a new laptop with a 17" screen and install a butterfly screensaver or something. That will make me happy, I'm sure.

What a great poem. I'm also the coffee bearer in my house.

I'm trying to track down the poem's provenance. Feeding it to Google reveals a song called "Anniversary Song", by Cowboy Junkies, with the credit for the song going to Michael Timmins.

Where did you first see/hear this, Brad?

whatever became of Margo Timmins and the cowboy junkies? I'd love to hear her do a cameo spot with Brazilian Girls!

My big beautiful white birch died last year, damnit. May have been it's time, a more sickening thought is that I should have run a hose to it but I'm an idiot.

The thing I understand least about McMansion plans is how the hell anybody can live without a bunch of old trees shading their house.

"How could Keynes, the most influential economist of the 20th century, have made such an absurd prediction? "

Simple; Keynes, like so many people, was unwilling to admit the extreme extreme EXTREME stupidity of the bulk of humanity. It's evidenced everyday, from everything about the Bush administration (Iraq, Iran, Katrina, global warming) to the contents of the best-selling magazines. Yet the few on earth capable of thinking continue to imagine that the stupid masses are just like us, only maybe not quite so quick.

Go watch _Idiocracy_, read _The Marching Morons_, ponder the realities of what's happening in America and what's not happening with respect to energy world wide. A world of Keynes' would behave like Keynes; a world of idiots behaves like the world you see around you.

Clarifying Note:

The "poem" is a partial lyric from a song written my Micheal Timmins (and sung by Margo Timmins) titled "Anniversary Song". The song appears on the Cowboy Junkies album, _Pale_Sun_Crescent_Moon_, from 1993.

The bridge lyric reads:

'And I don't know how I survived those days
before I held your hand
Well I never thought that I would be the one
to admit that the moon and the sun
shine so much more brighter when
seen through two pairs of eyes than
when seen through just one'

It was the second song played at our wedding reception.

Re: European countries are democracies. Is there any political movement to repeal these laws?


I am not sure what your point is, but your post is pretty much a non sequitur to mine. I was not doubting the political nature of European nations or the popularity of the their labor laws with their citizens. I was however pointing out that, absent those laws, Europeans would have no more choice about working longer hours with less vacation than we Americans do. Indeed. Europeans firms that operate facilities in the USA are generally worse on these issues than our own businesses are.

A couple of things that might help clear this up.

First, the couple visiting Paris hade not simply grown accustomed to a higher standard of cuisine, but rather to a different standard of cuisine. People tend to like the food they're used to, and they could have been burger afficionados rather than well-off people who dine in the best franchise road-houses in the home 'burb. The idea of higher or lower standards in something based purely on tongued perception is preposterous to begin with.

Second, if there is basic needs buying and superiority-seeking buying, the third big one is boredom buying. We buy a lot of things because we become habituated to the old ones. If you want to do an empirical experiment, go out and buy a motorcycle, the one that most appeals to you. In two weeks to six months you will want a different motorcycle, faster or more nimble or prettier or maybe with a seat that doesn't make your ass hurt so much.

About the only place this doesn't work is in the cuisine area. An American rube in Paris is easily disappointed by the food, independent of higher or lower standards, because, in contrast to habituation to most material goods, habituation to food spawns inertia. The Paris beef is all pink on the inside, and where the hell is the higher-standard ketchup, or the vinegar that is better because it tastes of pine sap?

Doctor Jay: "Why then, do we insist that there's something the matter with Kansans who don't vote Democratic to enhance their own economic interests? Maybe appeals to their material welfare aren't what we should be making."

Shhh... The contradiction between left-wing claims that "material goods are unimportant" and "redistribution of material goods is the highest political value" is not to be examined by those wishing to retain feelings of superiority* relative to their fellows.

*Not material superiority, of course...just moral superiority.

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