Caveat Emptor
I am sure that few consumers feel any of that sense of power which
economists say is theirs. No doubt when Mr. Morgan was buying antiques
there came to him a real sense that he commanded the market. But the
ordinary man with a small income to spend is much more like a person
who becomes attached to an energetic bulldog, and leaves the spectators
wondering which is the mover and which the moved. He is the theoretical
master of that dog....
The consumer is sometimes represented as the person whose desires
govern industry. Actually, he is an ignorant person who buys in the
dark. He takes what he can get at the price he can afford. He is told
what he wants, and then he wants it. He rides in a packed subway
because he has to, and he buys a certain kind of soap because it has
been thrust upon his soul. Where there is a monopoly the consumer
is, of course, helpless, and where there is competition he is almost
entirely at the mercy of advertising.
Advertising, in fact, is the effort of business men to take charge
of consumption as well as production. They are not content to supply
a demand, as the text-books say; they educate the demand as well. In
the end, advertising rests upon the fact that consumers are a fickle
and superstitious mob, incapable of any real judgment as to what it
wants or how it is to get what it thinks it would like. A bewildered
child in a toy shop is nothing to the ultimate consumer in the world
market of to-day. To say, then, that advertising is merely a way of
calling attention to useful goods is a gorgeous piece of idealization.
Advertising is in fact the weed that has grown up because the art of
consumption is uncultivated. By advertising I don’t mean descriptive
catalogues which enable the buyer to select. I mean the deceptive
clamor that disfigures the scenery, covers fences, plasters the city,
and blinks and winks at you through the night. When you contemplate the
eastern sky ablaze with chewing gum, the northern with tooth-brushes
and underwear, the western with whiskey, and the southern with
petticoats, the whole heavens brilliant with monstrously flirtatious
women, when you glance at magazines in which a rivulet of text trickles
through meadows of automobiles, baking powders, corsets and kodaks,
you begin to accumulate a sense of the disastrous incompetence of the
ultimate consumer.
For the scale on which the world is organized to-day discrimination has
become impossible for the ordinary purchaser. He hasn’t time to candle
every egg he buys, test the milk, inquire into the origins of the meat,
analyze the canned food, distinguish the shoddy, find out whether
the newspapers are lying, avoid meretricious plays, and choose only
railroads equipped with safety devices. These things have to be done
for him by experts backed with authority to enforce their decisions. In
our intricate civilization the purchaser can’t pit himself against the
producer, for he lacks knowledge and power to make the bargain a fair
one. By the time goods are ready for the ultimate consumer they have
travelled hundreds of miles, passed through any number of wholesalers,
jobbers, middlemen and what not. The simple act of buying has become
a vast, impersonal thing which the ordinary man is quite incapable
of performing without all sorts of organized aid. There are silly
anarchists who talk as if such organization were a loss of freedom.
They seem to imagine that they can “stand alone,” and judge each thing
for themselves. They might try it. They would find that the purchase of
eggs was such a stupendous task that no time would be left over for the
purchase of beer or the pursuit of those higher freedoms for which they
are fighting.
The old commercial theorists had some inkling of these difficulties.
They knew that the consumer could not possibly make each purchase a
deliberate and intelligent act. So they said that if only business
men were left to compete they would stumble over each other to supply
the consumer with the most satisfactory goods. It is hardly necessary
to point out how complete has been the collapse of that romantic
theory. There are a hundred ways of competing, to produce the highest
quality at the lowest cost proved to be the most troublesome and
least rewarding form of competition. To cheapen the quality, subtract
value that does not appear on the surface, lower the standards of
workmanship, to adulterate, in short, was a more “natural” method of
competition than the noble Platonic method which economists talked
about. And then came price agreements, the elimination of “cut-throat”
competition, and the consumer began to realize that he couldn’t trust
to the naïve notions of the nineteenth century.
He turned to the government for aid, and out of that has grown a fresh
sense of the uses of politics. The old commercialists saw in government
little more than the police power; the modern syndicalists refuse to
believe that the state can be anything but an agent of tyranny. But
the facts belie both notions. Politics is becoming the chief method by
which the consumer enforces his interests upon the industrial system.
Many radical socialists pretend to regard the consumer’s interest as
a rather mythical one. “All the people” sounds so sentimental, so far
removed from the clash of actual events. But we are finding, I think,
that the real power emerging to-day in democratic politics is just the
mass of people who are crying out against the “high cost of living.”
That is a consumer’s cry. Far from being an impotent one, it is, I
believe, destined to be stronger than the interests either of labor
or of capital. With the consumer awake, neither the worker nor the
employer can use politics for his special interest. The public, which
is more numerous than either side, is coming to be the determining
force in government.
Votes for women will increase the power of the consumer enormously.
The mass of women do not look at the world as workers; in America, at
least their prime interest is as consumers. It is they who go to market
and do the shopping; it is they who have to make the family budget go
around; it is they who feel shabbiness and fraud and high prices most
directly. They have more time for politics than men, and it is no idle
speculation to say that their influence will make the consumer the real
master of the political situation.
It is through government that people are seeking to impose upon
business a maximum of quality and a minimum of cost. Price fixing is
already in operation for public utilities; there is every reason to
believe that it will be extended to the great industries. The amount of
inspecting of products which is already being done it is impossible to
record. I don’t say that it is effective or satisfactory, but it is a
force to be reckoned with and it is sure to grow. We hear a great deal
about the class-consciousness of labor; my own observation is that in
America to-day consumers’-consciousness is growing very much faster.
What forms it will assume with time is not easy to predict. The great
extension of collectivism which is at hand will be carried through
and dominated by the “public.” The workers will have very little to
say about it, as workers. The public is capable of oppression, I have
no doubt, and when I say that consumers are going to dominate the
government I do not state the fact with unmixed joy. There will be a
tyranny of the majority for which minorities will have to prepare. But
good or bad, collectivism or “state socialism” is perhaps the chief
instrument of the awakened consumer.
One of the heritages from competitive business was almost complete
disorganization in selling of wares. Six grocers in three blocks,
dingy little butcher-shops, little retail businesses with the family
living in the back room, the odor of cooking to greet you as you enter
the door, fly-specks on the goods--walk through any city and marvel
at the anarchy of retail business. Well, the large department store,
organized markets, the chain of stores, the mail order business, are
changing the situation radically for the purchaser.
They are focussing his attention: he could not focus on a congery of
little shops. But where there is centralization, he has something of
which to take hold. The solidarity of the consumer is made possible,
just as large scale production is making possible a much greater
solidarity for labor. But it is doubtful whether the public will be
satisfied to stand outside these large retail organizations, and try to
regulate them through government inspectors. The example of the English
Coöperative Societies is very attractive. They represent a power for
the consumer, and in the face of the high cost of living, the consumer
is looking for power.
Business, then, must look forward to increasing control in the
interests of those who buy. Processes will be inspected, and regulated
by law, some industries will be operated directly by the government,
and producers in general may face coöperative organizations grown
powerful enough perhaps to command the market. Those seem to be
the general methods by which the consumer is trying to redeem his
helplessness in the complexity of the newly organized industrial world.
It is interesting to notice the revolutionary standards which are being
generated by this young social power. Take the matter of prices. That,
after all, is the first item that interests the purchaser. Quality is
a subtler notion. But in the matter of prices, there is coming into
existence an idea that profits can be “unreasonable.” It is an idea
that runs counter to the whole fabric of the old commercialism, where
the only recognized motive was profit and the only ideal all that the
traffic would bear. To talk about “reasonable returns” is to begin
an attack on industrialism which will lead far beyond the present
imaginations of the people who talk about it. The whole question of
unearned wealth is opened up, for “unreasonable” profit can mean only
unearned profit. Just where those words lead nobody seems to know.
But there is a groping behind them which points without question to a
radical attack on large incomes. The consumer talks about “reasonable
return” because he feels that any profit which keeps prices high must
be unreasonable. That may seem a curious logic, but it’s the kind of
logic which half-conscious democracies use.