Penguin, 2009, 296 pages, $32.50 hc, ISBN 978-1-59-420-215-5
Everything has its fair price, but whereas customers think of themselves as experts at spotting when something is too expensive, fewer are as skilled in detecting when something is priced too low. In Cheap, Ellen Ruppel Shell takes us on a tour of, as the book subtitle promises, “the high cost of discount culture”.
But “Someone always pay” could also have been the book’s subtitle as Shell traces the impact of a retail environment in which almost everything is said to be a bargain. This isn’t a simple issue, as discussions of Wal-Mart and other big-box stores quickly take us on a tour of economics, social policy, urban planning, human psychology and the nature of quality. With an unpleasant dilemma hovering in the background: While consumers are, on average, paying less for food and clothes and electronics now than they did a generation ago, is it fair to ask whether things are now too cheap?
It’s a fair question: Always Low Prices are often a race to the bottom for an entire distribution chain. By pushing suppliers to ever-lower profit margins, are today’s monolithic retailers eroding the various social institutions that have led to their creation? Has the great flight of manufacturing jobs outside America been a consequence of such relentless bargain shopping? Fifty years ago, well-paid employees were able to educate themselves and their children, live on a single salary and depend on good pensions to give back to the rest of society. But the aftermath of the latest frenzy towards price-cutting at all costs has taken away benefits that can only be found in healthy profit margins. The race to the bottom is global, now, as Shell travels to the countries that manufacture most of what’s sold in America, and finds out that the price to be paid for cheap good is often the exploitation of a population that is powerless to react.
Shell’s simple premise ends up leading us to one subject area after another and making troubling revelations along the way. The chapter on cheap food will find echo with Michael Pollan’s food policy journalism –Shell even manages to answer a question I’ve always been afraid to ask about the availability of cheap shrimp and as expected, the answer is likely to make you think twice about your next cheap seafood plate. A chapter on durability takes a number of well-deserved pot-shots at IKEA, whose mystique far outweighs its place as a devourer of possibly illegally harvested wood. Another chapter on retail outlets ends up being a primer on the ways manufacturer dilute their own hard-won brand in an effort to scoop up just another retail market, and how “cheap” outlet shopping isn’t so.
To total up her exploration of price, Shell depends on a mixture of historical research on the evolution of retailing in North America, original reporting both of the trivial (let’s go shopping!) and the globe-trotting variety, statistics, market analysis, expert interview and newspaper clipping. As a look at her chosen subject, it’s all-encompassing, careful, convincing and quite a bit upsetting. Confirming what socially-conscious readers already suspect, Cheap shows that there is no such thing as a bargain. Someone always pays, and the true price of cheap goods is in external costs: The idea that the customer who is purchasing the item at retail is not only paying just a fraction of the item’s true cost to the world, but encouraging endless levels of suppliers to do the same. The impact is always felt somewhere, most often in decaying social infrastructure and environmental damage.
It’s no surprise if this conclusion is entirely consistent with a bunch of activist literature from Naomi Klein to Eric Schlosser. We are, as globalized customers, embedded in this system. There are no easy answers no matter where we look: the current logic of economic systems makes breaking out of this spiral to the bottom seems impossibly daunting. Tellingly, Cheap, has little to offer in terms of solutions: It seems content to describe the problems in excruciating detail and leave the policy-making to others.
Which is not a bad decision: Cheap works best as a dispassionate and generally non-partisan exploration of an issue: The solutions are likely to be far more contentious, touching upon market regulation, fiscal policy, social programs and customer awareness. Then again, the ultimate solution to wage imbalances between first and third world is a drastic equalization: Better wages for third-world countries, and a dramatic involuntary lowering of our living standards. It’s not that there are no solutions to the high price of discount culture; it’s just that you may not like them when they solve the problems. Those who “shop till they die” won’t care about discount sales in the grave.