By: Ivan Breslavsky

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Most of you have heard of the term “Consumer Society” but I’ll give a more profound economic definition. Consumer society is a society in which an enormously large part of the public resources is spent on the consumption of goods, instead of their production. That is, people prefer to spend money on current consumption rather than on savings for the future.

Most people agree that this is quite an accurate description of the society we live in. And most people agree that consumer society is not something good, it’s not nice to spend instead of saving.

How did we become a consumer society

But how did we end up here? Two of the most popular explanations are:

1. People are filthy, it’s in our nature to demand now, to waste and not to think about the future. It’s either the lack of sense or the lack of self-control that makes us behave in such a way, so our nature or at least our psychology has to change.
2. People are innocent but easily manipulated. Capitalism results in a consumer society. Greedy corporations just make us buy their stuff. And we cannot help but obey the orders from the media.

Which explanation do I like?

Your bets?

Neither, of course.

Why those explanations are not good

Why would I come here to repeat common knowledge? There is a third and better explanation. But before I proceed, I’ll briefly explain why the previous two are not good.

1. Human nature. The term consumerism became widely used around fifty years ago. Did we have a consumer society before the middle of the XX century? No, we didn’t. So, did the human nature changed since then? Just in a few decades? Very unlikely.

Due to technical progress, society nowadays has more resources than ever, but we consume a higher percentage of them than at any other time in history. It should be another way. It is much easier to consume all you have when you are hungry. And yet, our ancestors saved where we spend. Probably, human nature is not an explanation.

2. What about capitalism? Maybe, we are spoiled by it? Let’s again think about the past. Imagine North America in the eighteenth century. Hard work, thrift, ascesis, basically having no fun is a foundation of a Protestant work ethic. If you can save something – save it! If you cannot – save it anyway! This way of living made America the fastest developing economy. And what was that if not blatant, pure, unregulated capitalism? We didn’t have a consumer society then, now we do. Probably, capitalism is not the right culprit to blame.

What has changed

So, we know for sure, that in the middle of the twentieth century something has changed. But what?

I’ll start in a roundabout way. Imagine. One shiny day, Bill Gates knocks your door. He says “Hey, if you suddenly run out of money, I’ll give you some. Every month.” In this case, will you save more or less? Probably, less.

That is pretty much what happened in the mid-twentieth century. Someone, who is richer than Bill Gates came to everybody and made an offer one cannot refuse. It was the State. The concept of “welfare state” occurred and became widespread. Now everyone relies on the State and prefers to spend rather than save.

The Welfare State

Everyone enjoys it when the other guy pays for them. But there is a problem – the State only pretends to be rich. The State doesn’t have its own money, it’s your money that they took from you. You are the “other guy”. And briefly, the situation unwinds like this:  first, the State told you that it is going to support you, so you are more relaxed and start spending more. By spending, you don’t get richer, obviously. You get poorer, so you pay fewer taxes, so the State comes to you and says “you know, we have obligations to fulfill, we need more money, so we’ll increase your tax rate”. And they do. Now, you have even fewer incentives to get richer, because a larger part of your wealth will be taken from you, so why bother? You work less and spend more and the taxes go higher again. The end of this story is not fun.

Invest in yourself

However, the end of my story is. There is a way to avoid wasting money and Big Brother coming for them. Invest in yourself. There is no tax on skills and whatever happens – you’ll be prepared.

Ivan Breslavsky is an experienced Research Associate with a demonstrated history of working in the higher education industry. Skilled in Mathematical Modeling, Matlab, Applied Mathematics, Numerical Simulation, and Biomaterials. Strong research professional with a Doctor of Philosophy (Ph.D.) focused in Physics and Mathematics from National Technical University «Kharkiv Polytechnic Institute».

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