Cheap - The High Cost of Discount Culture

Atlantic correspondent Shell (The Hungry Gene) tackles more than just discount culture in this wide-ranging book that argues that the American drive toward bargain-hunting and low-price goods has a hidden cost in lower wages for workers and reduced quality of goods for consumers. After a dry examination of the history of the American retail industry, the author examines the current industrial and political forces shaping how and what we buy. In the book's most involving passages, Shell deftly analyzes the psychology of pricing and demonstrates how retailers manipulate subconscious bargain triggers that affect even the most knowing consumers. The author urges shoppers to consider spending more and buying locally, but acknowledges the inevitability of globalization and the continuation of trends toward efficient, cost-effective production. The optimistic call to action that concludes the book feels hollow, given the evidence that precedes it. If Shell illuminates with sharp intelligence and a colloquial style the downside of buying Chinese garlic or farm-raised shrimp, nothing demonstrates how consumers, on a mass scale, could seek out an alternative or why they would choose to do so. (July) 
Copyright © Reed Business Information, a division of Reed Elsevier Inc. All rights reserved. --This text refers to an out of print or unavailable edition of this title.

"That cycle of consumption seems harmless enough, particularly since we live in a country where there are plenty of cheap goods to go around. But in her lively and terrifying book "Cheap: The High Cost of Discount Culture," Ellen Ruppel Shell pulls back the shimmery, seductive curtain of low-priced goods to reveal their insidious hidden costs. Those all-you-can-eat Red Lobster shrimps may very well have come from massive shrimp-farming spreads in Thailand, where they've been plumped up with antibiotics and possibly tended by maltreated migrant workers from Burma, Cambodia and Vietnam. The made-in-China toy train you bought your kid a few Christmases ago may have been sprayed with lead paint -- and the spraying itself may have been done by a child laborer, without the benefit of a protective mask. 

"Cheap" is hardly a finger-waggling book. This isn't a screed designed to make us feel guilty for unknowingly benefiting from the hardships of workers in other parts of the world. And Shell -- who writes regularly for the Atlantic -- isn't talking about the shallowness of consumerism here; she makes it clear that she, like most of us, enjoys the hunt for a good deal. "Cheap" really is about us, meaning not just Americans, but citizens of the world, and about what we stand to lose in a global economic environment that threatens the very nature of meaningful work, work we can take pride in and build a career on -- or even at which we can just make a living.
-Stephanie Zacharek, Salon.com 

"This highly intelligent and disturbing book provides invaluable insight into our consumer culture and should be mandatory reading for anyone trying to figure out our current financial mess. As Shell proves, the hunt for cheap products has hurt us all. Highly recommended for smart readers." -Library Journal 

"Diligent, useful cultural criticism, akin to Eric Schlosser's Fast Food Nation and Tom Vanderbilt's Traffic."
-Kirkus Reviews

"I just finished Cheap: The High Cost of Discount Culture by Ellen Ruppel Shell and I am now both disgusted and totally freaked out. Ed is hosting a round table discussion on this one in the coming weeks which I am a part of so I won't go into too much detail here but really, Shell has done an outstanding job of bringing together all the facets of our need to buy cheap: food, clothing, furniture, etc. She doesn't just talk Wal-mart (in fact she doesn't talk much about Wal-mart at all) but she does talk IKEA and Red Lobster and China and the history of discount shopping in our country (Woolworths, etc.) which is truly fascinating. Beyond all the info though, Shell's writing style is utterly and completely top notch. This is popular history/culture at its finest and after you read it, you will approach every single purchase you make with a high level of suspicion. 

  We have been roundly manipulated folks, for our entire lives. And while we all kinda know it, you have to read Cheap to really appreciate it. Staggering stuff."
-Colleen Mondor, reviewer for Booklist, Bookslut, Eclectica Magazine and the Voices of New Orleans 

"Talk about timely!-in the midst of our economic confusion, Ellen Ruppel Shell talks good sense about cost, price, value-about what constitutes a bargain, and about what makes for a (literal) steal."
-Bill McKibben, author of Deep Economy

"Americans have always loved a good deal. But, as this courageous book argues, that love has evolved into a destructive obsession. Shell shows through in-depth reporting that our never- ending hunt for discounts has fed a plethora of social ills. And by moving our production to the world's lowest-cost labor markets, we have scarified such basic values as handcraftsmanship and product integrity. As Cheap ably proves, you get what you pay for."
-Dana Thomas, author of Deluxe: How Luxury Lost Its Luster

"There is no free lunch. Ellen Ruppel Shell powerfully argues that we have paid a high price for buying cheap goods. Hers is compelling story that will hopefully convince Americans that making different choices as consumers can fundamentally change our society-and the world."
- Lizabeth Cohen, author of A Consumers' Republic

"Around the world, people are being forced to reconsider the very idea of prosperity, and to ask what kind of wealth matters most and can be sustained. Cheap appears at just the right moment to enrich this discussion. This history of discounting and bargain-mania will change the way shoppers think about their next trip to the mall. As an examination of the global effects of the quest for rock-bottom prices, Cheap an important addition to arguments about America's economic future. This is a valuable book for a troubled time."
-James Fallows, author of Postcards from Tomorrow Square

"More stuff for less! -the American recipe for material well-being. Now Ellen Ruppel Shell takes a hard look at this apparently simple notion and finds it isn't so simple after all. Cheap pulls apart the old economic verities and subjects the glib new promises of Wall Street and globalization to scrutiny. How did we find ourselves in our current mess? Shell finds part of the answer in our confused ideas about what, exactly, is a bargain price."
-Charles C. Mann, author of 1491 --This text refers to an out of print or unavailable edition of this title.

I like to read in bed and because the Wife is sensitive to light, I have bought numerous battery operated reading lights - all made in China. No matter what brands I purchase or how much I spend, within a couple of months the lights break and I'm left using a flashlight to read in bed until I go out and buy another. A reading light is quite a simple device consisting of a battery, LED, and wires all linked together in a circuit. This circuit is then encased in plastic, metal or a combination of the two. Although simple, these lights break within a few months. Sometimes the cases break, other times the soldering fails somewhere in the circuit. I try to repair them but the repairs inevitably fail after a few weeks. Over the past 5 years alone I have probably spent $150 on reading lights.

After reading Cheap: The High Cost of Discount Culture by Ellen Ruppell Shell I now understand that my frustration is the result of the replacement of quality goods by shoddy ones made in China in order to maximize profit and minimize expense. This exchange of shoddy for quality has happened as Americans have pursued low price at the expense of all else. We save money in the short term by pursuing low prices but lose much in the process including long lasting quality goods and decent paying jobs.

Shell writes for the Atlantic and is a professor of journalism at Boston University. Throughout the book I searched for Shell's anti-capitalist bias, but didn't find it anywhere. Instead she writes "Trade is and must be free," and believes that regulation and unionization is not the answer to our obsession with low prices. She quotes Adam Smith liberally and suggests that Smith himself would not be pleased with the junk on the shelves of America's superstores. She writes that Smith advocated a system whereby workers earned a decent wage to purchase a decent life, and supporting that system were Smith's heroes - consumers buying the goods and services made by the workers at fair prices. These prices weren't inflated: the consumer received a quality product that performed the job it was intended to do.

Shell discusses the usual suspects - Wal-mart, dollar stores and discount chain stores - but she zeroes in on Ikea as a firm that has built a mythos around itself to shield it from the fact that it uses illegally harvested hardwoods from the Russian Far East and Asia (Ikea is the third largest consumer of wood in the world), and sources production to some of the lowest paying companies on the planet. Shell cites a table that sells for $69. A master craftsman admitted that he couldn't buy the wood for that price, let alone build the table. Ikea headquarters exudes an aura of cultishness that is more reminiscent of Scientology than of a business. There workers design products that are meant to be made and ship cheaply - not to be comfortable. The products are given cutesy names that slaps a "happy face" onto what in essence is a soulless product.

While every move by American giant like Wal-mart is subjected to scrutiny by environmentally minded intelligentsia, she notes that Ikea is given a pass:

"Wal-mart's relentless march toward world retail domination provokes scathing exposes in books, articles, and documentaries. But most media responses to Ikea verge on the hagiographic, swallowing whole the well-polished rags-to-riches story the company wrote for itself."

Everything Ikea does is geared towards lowering its costs. Ikea's store placement outside of cities and away from public transit, as well as its refusal to deliver makes its customers drive to it is a conscious decision by the firm to minimize the cost per square foot of its stores by buying cheap land. It ships disassembled products to save on shipping and on manufacturing. It regularly squeezes its suppliers, thereby preventing workers in some of the poorest places on the planet from getting better wages while encouraging environmental abuses.

Shell's criticism of Ikea hits home because I've bought from there. In fact the table that I'm writing on is from Ikea. Its wood grain is quite dense, unlike that from plantation farmed trees. Of course only its legs are wood; it's top is wood veneer and already shows signs of wear after just three years. Did the legs come from illegally logged old-growth forest in Siberia or Indonesia? How environmentally friendly can this table be if it is already falling apart after 3 years and will need replacement in another year or two? It's not friendly to the environment - but it is to Ikea's profits if I'm stupid enough to go there and buy another table. No, it's replacement will be a nice, well-worn American table from a second-hand shop.

Shell makes a convincing case that America's love affair with shoddy goods is bad for the environment and living standards abroad. Unfortunately she could have made a better case that shopping at Wal-mart and Ikea leads to lower living standards at home. Shell mentions a worker in furniture manufacturing who was laid off by an American furniture maker and picked up by Ikea - at much lower wages and benefits. However families who shop at Wal-mart save roughly $2700 a year on their purchases, and since Wal-mart caters to the lower demographics the savings is a significant part of the demographic's income. Shell argues that this savings is less than the family would have made had Wal-mart and the discount chains not driven jobs abroad, and because the jobs are gone forever Wal-mart consumers are locked into a decreasing standard of living that no amount of savings can justify.

Shell's work is heavily footnoted but because the footnotes aren't referenced in the text, I ended up reading them on their own after finishing the book. This is a small quibble with an otherwise fine and thought provoking book, but it would have made her arguments even stronger had the footnotes been referenced.

Shell's writing style is easy to read and her ideas are well supported and researched. Her conclusion that it is up to Americans to recognize that things that fall apart quickly - like reading lamps - don't provide good value in the long run leaves the decision whether or not to improve the situation up to us.

She believes that we need to educate ourselves on the products we consume - where they come from, how they are made, and what we consume is in line with our values. If we are comfortable buying cheap crap that falls apart, sending our dollars to the Chinese government that funds oppressive regimes in the Sudan, Burma and North Korea, then we have no one to blame but ourselves.

Overall this book is must reading for anyone interested in modern American consumerism.

CHEAP opens: "This book is about America's dangerous liaison with Cheap. In a market awash with increasingly similar-even identical-goods, price is the ultimate arbiter, the lower the better." Shell admits that she has always been a sucker for discount come-ons, but writes: "it's not about thrift. The craving for bargains springs from something much deeper. Low price is an end and a victory in itself, a way to wrestle control from the baffling mystery that is retail.
Alas, that control is largely illusory..."

There is so much in this book it's hard to compress into a few words, but safe to say that everyone will learn something new. It begins with history: You've heard of Frank Woolworth but you probably didn't know that he practically invented the low wage, high turnover model for retail workers. You've heard of White Sales, but you probably don't know why John Wanamaker invented them. You know about bar codes and container ships and shopping carts, but you might not know how they transformed retail.

Cheap shows that price is more than a number, it's a powerful emotional trigger that gets us to buy or not depending on a number of easily manipulated but poorly understood (by us) factors. High "reference" prices compel us to buy things we otherwise would not, under the mistaken impression that we're getting a good deal. "Shrouding" helps us overlook the true price of our purchases, and the right "framing" can fool us into thinking that a mattress or piece of jewelry is our heart's desire, when really it's just a bad deal. And don't get me started on outlet malls!

Cheap food (I work in the food industry and the observations on shrimp farming are spot-on), cheap furniture (oh no, Ikea too?), cheap labor (it's not just China), cheap loans, it's all in there, and a whole lot more. Shell traces the path of cheap from sweatshops abroad to the economic problems we're facing here today; unemployment, job insecurity, flat incomes. What you won't find is preaching. This book is not about setting policy, it's about informing consumers about where we are and how we got here. It will open your eyes a little wider and help you keep your wallet closed a little longer.