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Keeping Up With Robert Frank


Cornell economics professor Robert H. Frank, the New York Times columnist and author of Luxury Fever and other books, gave the opening lecture at the Human Behavior & Evolution Society conference I'm attending in at Penn in Philadelphia. His was a very interesting talk about absolute versus relative consumption.

Relative consumption is your consumption as compared to that of your neighbors; your satisfaction measured in “keeping up with the Joneses.” But, he points out that, contrary to popular "wisdom," money can buy happiness, as life is simply easier and more pleasant if you're wealthy.

The problem is, according to Frank, as one segment of society gets very wealthy, lower segments of society feel pressured to acquire more outward displays of wealth (fancy cars, bigger houses) to appear to be keeping up.


Frank told a story about his days teaching in Nepal (I think with the Peace Corps), and how he had this house with a leaky grass roof. In America, he noted, such a house would be simply unacceptable, but there, it was a better house than all the other teachers had and he was very happy with it. He also gave the example of this car:


If you drive a Nova in Havana, Cuba, you've got status. In Beverly Hills, you've got a problem.

While people think concerns about relative position come from growing up in a capitalistic society, he pointed out that they seem to be hardwired nervous system components. Evolutionarily, people should care about relative position because it affects material payoffs; for example:

--food in famines
--mate access
--effort monitoring
--choosing right arena (sorry, forgot what this one means, exactly, and no time to go to my recording)

I loved this Mencken quote he put up:


He sees the "expenditure arms race" -- the increased spending by the average person on flashy luxury items to keep up with the rich, who can afford those items -- as a serious problem, as it's financed by decreased personal savings and increased personal debt. Here's an example from his Luxury book:


There is a real reason, sometimes, for appearing richer than you are, as it may help convince people you're of a higher status, and, perhaps, give you a job because of it.

But, maybe there's a rationality and evolutionary psych-based solution to this: articulating and pointing out, to the average person, the longterm cost of overspending, and suggesting to that they instead live within their means (that's the rational part), and "cheat" (that's the ev psych-inspired part) to appear wealthier and higher status when it matters.

They could, for example, shop cleverly so they appear rich and high status when it actually has tangible benefits (for a job interview), and then be mindful of what keeping up the expenditure arms race means for their savings and future when it has no tangible benefits. So...maybe buy a Hugo Boss suit when it's on sale in August, and you'll look the part of the guy who should get that job. But, live in a reasonably sized house so you aren't blowing your retirement savings.

Frank and I talked later, and I asked him about what I call ethical capitalism, mentioning the work of the English economist Pigou, who talked about businesses factoring into their profit the cost of their goods to society, instead of expecting society to pay (à la Exxon in Alaska, etc.). He recommended this book, Capitalism At The Crossroads, by Stuart L. Hart.

He finds it hard to believe that we're giving tax breaks to the highest earners in society when we can't afford to monitor loose nukes in Russia, or our ports, or fund Homeland Security properly in New York City.


He told me he’s basically a libertarian, but has a more expansive vision of what constitutes “harm” in the the libertarian “do no harm.” I do as well. Why, for example, should people be allowed to pollute unnecessarily and endanger the rest of us by driving these vast SUVs? He reminded me that Dave Barry renamed the one below "The Subdivision":


He mentioned Mickey Kaus' recent contention that the rich are downscaling to sedans. I agree that some are, but I still see a segment of the population in Los Angeles with brand new gigundo SUVs -- who seem to be using these vehicles as their way of bragging, "I'm so rich, even $4-a-gallon gas won't stop me from driviing this thing."

Frank and I have the same libertarian take on personal risk. He told me his notion about people riding motorcyles without a helmet –- which is pretty much the same as mine. Here it is from a past Advice Goddess Blog entry:

I have no problem with anybody who wants to ride a motorcyle without a helmet, or walk on a tightrope between two skyscrapers -- providing they have either some special health insurance premium or a card in their wallets saying that when their brains become huevos rancheros on the sidewalk, they stay huevos rancheros on the sidewalk.

I was flattered to find that he knows (and misses) my column, which the Ithaca Journal dumped after I wrote “Sex isn’t special. Monkeys do it, and not because somebody gave them flowers or expensive jewelry.” More about that soon, as I just called the managing editor at the paper, Bruce Estes, to see if they'd pick it up again. I'd like to think Estes and other editors and publishers (such as the grudge-holding Amy Alkon haters at the LA Times) would follow Cathy Seipp's advice in her column about Alisa Valdez-Rodriguez on what papers should be running:

That Alisa can be a royal pain is obvious even just from the titles she's considering for her next book (I think she should stick with her first choice, the excellent "Girl Crush.") These include: "All-American Bitch," "Selfish," "Me, Me, Me," "Boosters, Bitches and Babes" and "Latinas Who Lunch."

But that's what makes her such a great story, and you'd think that especially in these days of declining circulation, editors would jump at the chance to engage readers rather than bore them.

Beyond that, the public isn't well served when stories are assigned (or not) on the basis of who Brenda Starr and friends feel like talking to this week. Newspapers are a public trust, and those who work for them have an obligation to rise above their personal squabbles and hurt feelings.

Posted by aalkon at June 9, 2006 4:32 AM

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> pending by the average person
> on flashy luxury items to
> keep up with the rich, who
> can afford those items --
> as a serious problem

They covered this in the bible.

> maybe there's a rationality
> and evolutionary psych-based
> answer for this

Commandments apply... See #'s 8 & 10.

Posted by: Crid at June 9, 2006 1:13 PM

The best solution to the problem of fuel consumption and the pollution it creates is not to tax the wealthy willy-nilly so that they don't have the funds to buy gaudy gas guzzlers, but to include a pollution tax on gasoline. The amount of the tax would have to be indexed to some estimate of the harm caused by burning the gas. This way the people using the fuel are also paying for the harm caused by it, and have a wallet-based reason to conserve. And it would be fair, because even though I drive a fuel effecient car, I do still contribute to pollution and should pay for it like anyone else.

Also, as far as the tax breaks to the rich being used for consumption, remember somebody gets paid to produce the goods they consume, and those people are typically middle class. Wealthy people's consumption pays a lot of middle class salaries. All the nice things listed in the slide that their tax money could be used for are fine, but we could also get the same things by keeping the tax cuts and elimating any of ten thousand wasteful pork projects. Then we could have the stimulus to growth from wealthy people's consumption, and the helpful programs. The only people losing out would be the congressmen and their friends, and to hell with them anyways :-)

Posted by: Todd Fletcher at June 9, 2006 1:42 PM

> Dollars that could have been
> used for improving public
> education, conducting medical
> research, or inspecting the
> cargo containers that enter our
> ports have been spent instead
> on larger houses and more
> expensive cars.

I hate these words with the undying fire of ten thousand scorching suns. My hatred slams each heartbeat with the pounding, explosive roar of thunder in the canyons and the valleys....


NOBODY is stopping you from giving more money to educators, medical research, or cargo inspection. Those "Dollars" are private property that are taken from people at gunpoint. (That's how the IRS does its business.) There are names for people who know how other people should be spending their money. They're called teenagers. Or communists. Or liberals. Or BUSYBODIES.

It's a wicked, arrogant, small-minded fantasy. "Jeez, if I could just TELL people when they're spending too much on cars and barbeques, I could make the world safe for children and other living things!"

- markcridland@hotmial.con

Posted by: Crid at June 9, 2006 2:11 PM

Mr. Cridland, it all depends on what our gov't subsides. I'm mighty sick of the $12000 or so tax dollars taken from me every year paying for mining in the national forests, not to mention neocon adventures abroad, while SUVs and pickups get a tax break. As do those who keep pushing out little consumers of the now bloated American Dream.

It's not about telling the bozo at the gas pump to wise up; it's about informing our elected officials that we're tired of having our money wasted on subsidizing a foolish and unsustainable way of life. Go ahead and drive your pseudo-tank. Just don't make me pay for it in polluted air and tax subsidies for your "utility" vehicle.

And I don't know what libertarian principle advises living beyond your means.

Posted by: Monica at June 9, 2006 3:15 PM

> it all depends on what our
> gov't subsides.

Y'know, if government WOULD subside, we'd be better off. Seriously, OF COURSE government shouldn't waste money. But it always does. So the solution is less government, not more.

When you say bloated, do you mean disproportionate and sickly? Then of course, a bloated American Dream is going to push people out. This is the crux of what Amy's writing about. People want to live too large. But the problem is human nature, not policy.

> it's about informing our
> elected officials that we're
> tired of having our money wasted
> on subsidizing a foolish and
> unsustainable way of life

Government's not exactly insisting that people buy big cars. Things that strike you as foolish will strike others as heavenly. I've never cared about opera or professional sports... But good seats mean a lot to the fools who do.

> I don't know what libertarian
> principle advises living beyond
> your means.

Libertarianism trusts you to know your own means. There's certainly no libertarian principle that tells how much pork your barbecue should roast.

PS- I think "sustainable" is a tell word. It nakedly asks that the world sit still while everything's put into place. But that's just not how things work: Not in politics, not in intimacy, not in nature. Life's a moving target.

Posted by: Crid at June 9, 2006 4:04 PM

I think the only way we're going to see energy efficient vehicles is if we develop a fuel that's both safe for the environment and can turn a profit. Whether we tax the rich or not we're going to make no progress unless it helps us make money. People can cry all they want that American was built on God, but in reality it was built on money. If major corporations saw huge profits in ethanol and other fuel sources they would have jumped on the band-wagon long ago. Truth is that there's just nothing out there right now to cover the financial losses that would be inflicted on the oil industry. Sure there's money to be made, but not in the scale that the oil industry is "pumping" out right now.

Posted by: Alan H. at June 9, 2006 4:47 PM

Sustainability is indeed a "tell" word. It tells you that you're dealing with someone who'd like her great-great-grandnieblings to have a natural world to enjoy as she did. If that's foolish and unrealistic, then I'm a proud fool.

Even so, I do wish the gov't would go away. But it seems to be the system we're stuck with, for now.

Posted by: Monica at June 9, 2006 4:52 PM

Mah-nee-kah! You're fucking with me. Earth is not a planet of vegetarian Inya videos, where everything moves like pastel chiffon blown in slow-motion by an oscillating fan just off camera. You know this!

Also, what's a niebling?

Dennis Miller is the only one who's had the nerve to say it, paraphrasing: "I don't think my great-great-grandfather ever did anything with me in mind. At most, he was hoping to keep his surly teenage son in line through another harvest or two."

Posted by: Crid at June 9, 2006 8:07 PM

Crid! Earth is also not a roaring playground for ATVs. Not yet, anyway.

A niebling is a niece or nephew. Kind of like a sibling. We aunties need a more streamlined way to describe them.

Dennis Miller may not give a damn what his grandchildren have to put up with, but the Indians did. Since Denny went bonkers over 9/11, I'd rather stick with the native Americans.

Posted by: Monica at June 9, 2006 8:25 PM

The Indians left for their descendants a stone-age, warmonger culture marked by disease and tit-for-tat incursion of rape and pillage into cousin cultures in adjacent valleys.

Thanks, guys.

If all you want to give your g-g-g-kids is a life like your own, that being three decades of starvation and scabies, the model of the American indian is not the worst way to go.

Oooomphg! Fire! Uulrrrgggk! Rain!

Is there a Denny's in the neighborhood? I'm in the mood for a Rooty-Tooty-Fresh-and-Fruity served by a wide-hipped high school dropout with a bad attitude.

In a Denny's in 1981, I wept while pouring maple syrup over a short stack as John Barry played through the cheap ceiling-mount loudspeaker overhead. (It might have been a Howard Johnson's, but same thing.) Eggs, flapjacks, two kinds of pork, toast and OJ for three-forty-nine. A tremendous deal. This was in Indianapolis.

Life in postwar America is GOOD.

Posted by: Crid at June 9, 2006 10:02 PM

If you drive a Nova in Havana, Cuba, you've got status. In Beverly Hills, you've got a problem.

LOL! This one scored an entry in my quote database.

Posted by: GPE at June 10, 2006 6:32 AM

Dennis Miller is wrong, because his grandfather was not in charge in that respect; his genes were, and they were directing him to behave in all sorts of ways that promoted Dennis' welfare and the continuation of grandpa's genes.

Posted by: Amy Alkon at June 10, 2006 7:17 AM

What misfire is going on in the genes of those who have decided to never have children then?

Posted by: Oligonicella at June 10, 2006 11:02 AM

We live in what's called an "evolutionarily novel" environment. Before modern times, a woman didn't have to want to have children; if she had sex, she'd very likely have them.

Posted by: Amy Alkon at June 10, 2006 11:08 AM

"..a stone-age, warmonger culture marked by disease and tit-for-tat incursion of rape and pillage into cousin cultures in adjacent valleys."

If only there was a vacation package that offered that...

Posted by: eric's got a week to kill... at June 10, 2006 12:53 PM

> Dennis Miller is wrong

Sociobiologists can be forgiven for their many honest errors. But their unrepentant smugness earns them a special corner of Hell.

Posted by: Crid at June 10, 2006 3:50 PM

I think it's a mistake to use taxation for social engineering. You know, people shouldn't eat so much junk food, so let's tax it. Instead, taxation should simply be a way for the government to raise money - plucking the goose so as to obtain the largest amount of feathers with the least amount of hissing, as the man said. If the government wants to stop people eating junk food, then it should be voted out of office. This would reduce taxes. Adults should be allowed to eat, smoke, drink or drive themselves to death, so long as they don't break any laws. If junk food is that important, make it illegal. Otherwise shut up.

In case it's not blazingly obvious, this applies to 4x4s, mind-bending substances and other consumer choices, not just to junk food.

Posted by: Norman at June 11, 2006 11:18 AM

Mr. Cridland should by all means put his money where his mouth is by moving to Somalia. Cell-phone service is exceedingly cheap, markets are booming, bodyguards are available at quite reasonable rates, and the climate is no worse than Phoenix, Arizona, where libertarians are already to be found.

Mr. Fletcher might be interested in Georgist economics (aka "geolibertarianism"), which is about how to reconcile freedom and conservation.

Posted by: John Cowan at June 11, 2006 11:22 AM


Posted by: Crid at June 11, 2006 2:42 PM

One: "asthma" is more common because we are now recognizing things like common cough are often related to mild asthma. So by diagnosing mild cases, we increase the numbers artificially.

Two: In developing countries, asthma is probably just as common. Why? Because of indoor open fires cause air pollution. But unless the kid is gasping, we don't diagnose it.

Three: Worms cause anemia and complicate malnutrition. Even the benign ascaris can "migrate" upward and choke a sick child to death. You want worms. Fine. YOU put up with them.

Four: It's a false choice to say rich people spend money on luxuries, so we should use the money for paying welfare benefits to poor people.That sees money as a limited pie to be divided.

In reality, to help poor people, you make more pies by hiring them.

If you buy a luxury item, you essentially are providing jobs for those who make the item, who make the basic parts of the item, the ones who ship the item, and the middle men who arrange you to buy it.

For example, one of the sources of income for our local (Philippine) villages is making luxury items to export...So maybe you don't want to spend two dollars on a fancy Christmas ball, but by not doing so, some of our locals won't have work.But when people work, prosperity spreads...

Posted by: Boinkie at June 11, 2006 4:06 PM

Um, Boinkie, unless you're a working epidemiologist, going from statistics, the speculation about asthma being more common is anecdotal.

And regarding your contention about worms -- clearly you're not up on the latest research. See J.V. Weinstock, and see my earlier post about the plenary by Marlene Zuk. Perhaps the worms can eat off all the egg on your face!

Posted by: Amy Alkon at June 11, 2006 7:06 PM

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