11: Too Many Consumers?

The world with its billions does not have too many people, but it does have too many in their thousands who think that they are worth a million others.

—Daniel Dorling¹

 

 

Closely related to the claim that “too many people” are destroying the world is the assertion that the problem is “too much consumption.” That concept is embedded in the IPAT equation—the Ehrlichs themselves tell us that “‘consumption’ is in some ways a more accurate term than ‘affluence,’ but PAT is a much handier acronym than PCT.”²

The concept is often expressed in terms of ecological overshoot or in the number of “earths” required to support our excessive lifestyles. A report from Britain’s New Economics Foundation puts it this way:

In 1961 . . . the UK’s consumption patterns were roughly aligned with one planet living—that is, one planet’s worth of resources would be needed to support the whole global population at the UK’s level of consumption. By 2009, this grew to 3.1 planet living. In other words, we would need an additional 2.1 Earth-like planets if every human were to replicate the same levels of consumption in the UK.³

That is an important statement about the nature of the global economy. The countries of the North use a grossly disproportionate share of the world’s resources, including both physical materials (water, minerals, food) and ecological services such as the atmosphere’s ability to absorb greenhouse gases. Simple justice—not to mention human survival—demands that the earth’s resources be shared fairly. The North must use less, so that the South can escape poverty.

In the words of Bolivia’s president, Evo Morales, “the United States and Europe consume, on average, 8.4 times more than the world average. It is necessary for them to reduce their level of consumption and recognize that all of us are guests on this same land; of the same Pachamama [Mother Earth].”⁴

But problems arise when populationists attempt to trace the obvious disparity between North and South to the behavior of individual consumers in the North.

• Alan Durning, Sierra Club: “The consumer society’s exploitation of resources threatens to exhaust, poison, or unalterably disfigure forests, soils, water, and air. We, its members, are responsible for a disproportionate share of all the global environmental challenges facing humanity.”⁵

• A PBS television special: “Even though Americans comprise only five percent of the world’s population, in 1996 we used nearly a third of its resources and produced almost half of its hazardous waste. The average North American consumes five times as much as an average Mexican, 10 times as much as an average Chinese and 30 times as much as the average person in India.”⁶

The conclusion usually drawn from such statements is that the world can be saved only if the “average American” can be persuaded to cut back drastically, to eat less, drive less, spend less. “Unlimited production and consumption are at the root of our current environmental decay: people will have to lead more ecological lives and will have to consume less in order to achieve a green environmentally safe and sound society.”⁷

In recent years, growing numbers of people in the North have indeed been trying to reduce their personal ecological impacts. Every day more people are driving less, rejecting bottled water, turning down their thermostats, and switching from incandescent to fluorescent light bulbs. Any effort to tread more lightly on the earth deserves approval and encouragement, and the fact that so many people are trying to do so is evidence that we can win a majority in the fight for an ecologically sustainable future.

But important as those actions are, it is essential to recognize that individual consumption is not a major cause of environmental destruction and that changes in individual behavior can make at most a marginal difference.

The argument that the world is threatened by “overconsuming Americans” (or Canadians, or Australians, or . . .) rests on two fundamental errors about the nature of the problem: it confuses two different kinds of consumption, and it ignores substantial inequalities within the rich countries. We’ll discuss each in turn.

Confusing two kinds of consumption

In a 2008 New York Times article, best-selling author Jared Diamond wrote:

The average rates at which people consume resources like oil and metals, and produce wastes like plastics and greenhouse gases, are about 32 times higher in North America, Western Europe, Japan and Australia than they are in the developing world . . . Americans might object: there is no way we would sacrifice our living standards for the benefit of people in the rest of the world. Nevertheless, whether we get there willingly or not, we shall soon have lower consumption rates, because our present rates are unsustainable.⁸

Diamond, like other populationists who make the “too many consumers” argument, is confusing two very different processes: the “consumption” of raw material and environmental resources in the production and distribution of goods and the “consumption” of goods and services by individuals and households. As Victor Wallis points out: “It is remarkable . . . how little effort is routinely made to disaggregate the ‘consumption’ category. Common parlance, reinforced by the typical framing of cross-national statistics, links consumption to the satisfaction of individual needs or wants, whereas in fact, as an ecological category, it refers to all throughput of materials and energy, for whatever purpose.”⁹

The great majority of “consumption” (throughput) does not involve individual product users at all. For example, the average rate at which people produce waste, mentioned above by Diamond, is calculated by dividing the total population into the total waste. But since 99 percent of all solid waste in the United States today comes from industrial processes, eliminating all household waste would have little effect on per capita waste.¹⁰ Diamond’s “average rate” is meaningless.

The case of greenhouse gas emissions is similar. The following summary of emission sources is for Canada in 2007,¹¹ but the breakdown is similar in other super-emitting industrialized countries.

Passenger transportation	19%
Commercial transportation	17%
Industrial	34%
Residential	15%
Commercial/institutional	13%
Agriculture	3%

Only two of those categories can be reasonably attributed to consumers—passenger transportation and residential, a total of 34 percent of Canada’s emissions. Although that is not a small proportion, it shows that individual consumers aren’t the biggest problem.

But 34 percent substantially overstates the actual emissions that end-customers have any control over, because about 90 percent of “residential” emissions are not produced in residences at all—they are produced by electrical and natural gas providers and statistically attributed to residences in proportion to use, even though residential customers have no control over how electricity is made.

A very different picture emerges when emissions are calculated, as the Stern Review on The Economics of Climate Change did in 2007, “according to the sector from which they are directly emitted . . . as opposed to end user/activity.”¹²

 

Energy emissions

Energy emissions
Power	24.8%
Industry	13.7%
Transport	13.5%
Buildings	7.7%
Other	5.0%

 

Non-energy emissions

Non-energy emissions
Land use	18.3%
Agriculture	13.7%
Waste	3.4%

In short, the great majority of greenhouse gas emissions originate in industrial and commercial operations. Attributing those emissions to consumers is, to say the least, misleading.

Ignoring inequality in the North

No one can deny that most people in the global North enjoy material living standards far higher than those of most people living in the South. It’s often pointed out, for example, that a poverty-level income in the North would support a middle-class standard of living in much of the South. Overcoming such gross inequality is a key task facing any movement that aims to build a better world.

But that does not mean everyone in the North lives a lifestyle that endangers the earth’s future. Talk of the “American standard of living” (or Canadian, or Australian . . .) obscures substantial inequalities within the countries of the North. For example, Australian author Clive Hamilton writes:

Most people are prosperous beyond the dreams of their parents and grandparents. The houses of typical families are bigger than ever and are filled with big-screen TVs and DVDs and racks of unused clothes. They are centrally heated and air-conditioned; many have swimming pools or pool tables; most have unused rooms; expensive cars are parked outside. It is nothing for an average parent to spend several hundred dollars on a present for a child or to buy them a personal mobile phone . . . Despite the availability of free education, large numbers of households with no more than average incomes choose to outlay tens of thousands of dollars to send their children to private schools and then to universities.¹³

Hamilton is right to draw attention to the social and ecological costs of mass consumerism. Western capitalist economies depend on continual expansion of mass consumption. Multibillion-dollar industries feed off and constantly reinforce the drive to sell more: automobiles, cosmetics, film and television, mass media, professional sport, fast food, leisure and travel, pharmaceuticals, alcohol and tobacco, personal computers, mobile phones, household appliances, supermarkets, and more. Central to the story is the rise of the evil twins of capitalist marketing: advertising and planned obsolescence. We discuss this in chapter 12.

But Hamilton’s conclusion, that this has resulted in a new economic order he calls “consumer capitalism,” ignores other important trends. Advertising and mass consumption have grown spectacularly, but they have been outpaced by the military and by the fossil fuel, mining, and petrochemical industries. The influence of those organizations, not consumers, has been the decisive factor in preventing effective action to cut greenhouse gas emissions.

Hamilton, like many other critics of consumerism, describes consumption patterns that only a minority of privileged families can afford. Compare his description of the lifestyles of those he calls “most people,” “typical families,” and “average parents” with Barbara Ehrenreich’s account of the actual lives of her coworkers at the Hearthside restaurant in Florida:

Gail is sharing a room in a well-known downtown flophouse for $250 a week . . .

Claude, the Haitian cook, is desperate to get out of the two room apartment he shares with his girlfriend and two other, unrelated people . . .

Annette, a twenty-year-old server who is six months pregnant and abandoned by her boyfriend, lives with her mother, a postal clerk . . .

Marianne, who is a breakfast server, and her boyfriend are paying $170 a week for a one-person trailer . . .

Billy, who at $10 an hour is the wealthiest of us, lives in the trailer he owns paying only the $400-a-month lot fee . . .

Tina, another server, and her husband are paying $60 a night for a room in the Days Inn. This is because they have no car and the Days Inn is in walking distance of the Hearthside . . .

Joan, who had fooled me with her numerous and tasteful outfits (hostesses wear their own clothes), lives in a van parked behind a shopping center at night and showers in Tina’s motel room.¹⁴

Those real people aren’t “prosperous beyond the dreams of their parents and grandparents.” They are struggling to survive, in a society in which the cards are stacked against all but a fortunate few.

Much literature on “consumerism” demonstrates little actual contact with the world; it typically retails the distorted images of everyday life that are promoted on television and in advertising but that have little to do with most people’s reality. Ehrenreich’s coworkers have no chance of living the life of high material consumption that Hamilton and others describe.

In 2009, 43.6 million Americans lived on incomes below the official poverty line. If anyone is consuming the world into ecological catastrophe, it isn’t them.

The problem of inequality doesn’t stop at the official poverty line. Indeed, it’s hard to reconcile claims of profligate spending with the reality of what has happened to the incomes of most Americans (and their counterparts in other countries) in the past forty years. Economist Michael Perelman calculates that the average income of the bottom 90 percent of the population, in constant dollars, fell 4.5 percent between 1970 and 2002.

This estimate does not mean that everybody in the bottom 90 percent fell behind but that the losses among the vast majority of these people were sufficient to counterbalance the gains of the more fortunate members of the bottom 90 percent. So probably 80 percent of the population was worse off in 2002 than in 1970.¹⁵

During that period, while most people’s incomes were stagnant or declining, the price of housing, the single largest item in any working family’s budget, went through the roof. According to the US Census, the median price paid for a new home in the United States, adjusted for inflation, rose from $27,600 in 1970 to $169,000 in 2000—and that’s before the housing price bubble! ¹⁶

Since individual incomes didn’t keep pace, house buying has increasingly become possible only for two-income families.

The typical middle-class household in the United States is no longer a one-earner family, with one parent in the workforce and one at home full-time. Instead, the majority of families with small children now have both parents rising at dawn to commute to jobs so they can both pull in paychecks . . .

Today the median income for a fully employed male is $41,670 per year (all numbers are inflation-adjusted to 2004 dollars) —nearly $800 less than his counterpart of a generation ago. The only real increase in wages for a family has come from the second paycheck earned by a working mother.¹⁷

Usually, keeping two jobs requires two cars. And that usually means the new home has to be in the suburbs, where lots are big enough for two-car garages. Suburban houses tend to be a little larger; in Canada, the average household’s living space increased 10 percent, from about 116 to 126 square meters (1,250 to 1,356 square feet) between 1990 and 2007.¹⁸ So most house buyers aren’t moving into the monster homes of superconsumer mythology, but they are getting a little more room—and so their heating and air conditioning bills are higher.

Family incomes are up, but as a result of rising house costs, unavoidable family expenditures are up even more, as this table shows. These figures are adjusted for inflation:

	Early 1970s, one-income family	Early 2000s, two-income family
Total income	$42,450	$73,770
Fixed costs	$22,890	$55,660
Discretionary income	$19,560	$18,110

After fixed costs (mortgage, child care, insurance, car, taxes) were deducted, the average two-income family in the United States in the early 2000s actually had $1,500 less discretionary income than a single-income family in the early 1970s.¹⁹

Of course, these figures are averages, with all the limitations of other averages we have discussed. Working families with higher incomes or fewer children will generally have more discretionary income than this table suggests, while those with lower incomes or more children will have less. But on the whole, the statistics show that most working families live on the edge, with not much income for extras. Many can only maintain their standard of living by going into debt, as the authoritative State of Working America, 2008–2009 reports:

Debt is a more important feature of the household economy than at any time in modern history. Over the last decade especially, many American households have become dangerously overlever-aged . . . Wages and income have largely stagnated, and without being able to count on these means for maintaining living standards, many families have taken advantage of often extremely low interest rates to finance consumption through debt. More families than ever before now live with the insecurity of knowing that a financial emergency such as a serious illness, loss of employment, or even an increase in interest rates could mean being unable to maintain debt repayments.²⁰

There’s no question that most working people in the North have more material wealth than those in the South, but as these figures show, the idea that all or most working people in the North are affluent is an illusion:

Meager livelihoods are a typical condition, an average circumstance in the United States, not an extreme condition. You don’t need to earn especially low wages in the United States to face spare cupboards. The average hourly wage will serve you just fine . . .

Millions of American households work and live on the edge. There is no cushion. Even a small decline in wages, at the margin, can hurt severely and force considerable sacrifices.²¹

Populationist arguments typically ignore the huge income disparities within the countries whose overconsumption they decry. In the largest and richest such country, the United States, the wealthiest 20 percent of the population receives and spends more than 60 percent of all income. In 2006, people in the richest 20 percent had a minimum income of $97,000 and an average income of $258,000 a year—13 times the average received by the poorest 40 percent.²²

The environmental implications of such inequality are profound. A recent Canadian study found that “the ecological footprint of the richest 10 percent of Canadian households is several times the size of the footprint of lower- and lower-middle-income Canadians.”²³ As the report’s publisher commented: “When it comes to environmental impact, it really is a case of the rich and the rest of us.”²⁴

The real superconsumers

Perhaps the most frequently misused word in all populationist discussions of the developed countries is we. James Lovelock, for example, writes:

When we drive our cars and listen to the radio bringing news of acid rain, we need to remind ourselves that we, personally, are the polluters. We, not some white-coated devil figure, buy the cars, drive them, and foul the air. We are therefore accountable, personally, for the destruction of the trees by photochemical smog and acid rain. We are responsible for the silent spring that Rachel Carson predicted.^{25 26}

To paraphrase Bob Dylan, it ain’t we, babe.

Since 1970 the incomes of most working people in the North have stagnated or declined. Far from engaging in an orgy of consumerist overspending, they have struggled, even gone into debt, to maintain a 1970s standard of living.

The wealthy had no such problem. The incomes and wealth of the rich minority soared during the same years, pushing inequality to extremes not seen since the 1920s. This table, based on US Congressional Budget Office figures, shows the contrast between how the rich and the rest of us fared in the last three decades of the twentieth century.

The trend toward greater inequality—the rich getting much richer while everyone else loses ground—accelerated in the 2000s.

According to US tax data, in 2007 the average pretax income of people in the bottom 90 percent of households was about $900 less than in 1979, while the average person in the top 1 percent took in over $700,000 more than in 1979.²⁷

The disproportionate share of income taken by the very rich in the United States, UK, Australia, and Canada has led analysts at one of the world’s largest banks, Citigroup, to define those countries as plutonomies—economies “where economic growth is powered by and largely consumed by the wealthy few”²⁸ (emphasis added).

Journalist Robert Frank summarized the implications of the plutonomy theory in his book about the extremely wealthy, Richistan:

[Citigroup chief equity strategist Ajay] Kapur figured that the top 20 percent of income earners account for as much as 70 percent of consumption in the United States. Like it or not, he said, spending by the rich was propping up the economy, even as the middle and lower classes were struggling . . .

So rather than trying to figure out why the average American consumer was still spending despite rising oil prices, Kapur focused on the wealthy. He found that since the wealthy had so much disposable income, they were largely unconcerned and unaffected by the rise in oil prices. The continued spending by the rich was, in fact, propping up the rest of the consumer economy. As one yacht owner said when I asked him if he worried about rising fuel costs: “So it costs me $60,000 to fill up instead of $40,000. That’s nothing for a boat that costs $5 million a year to maintain.”²⁹

Merrill Lynch and Capgemini, companies that serve the very rich, publish an annual World Wealth Report that focuses on those they call High Net Worth Individuals (HNWI)—people with more than $1 million in investable assets, not counting their primary residence, collectibles, consumables, or consumer durables. The 2010 edition reported that about 0.15 percent of the world’s population—ten million people in all—qualify for HNWI status, and that their combined wealth totals $39 trillion.³⁰

Within the HNWI group, the World Wealth Report, 2010 identifies ninety-five thousand Ultra High Net Worth Individuals who have more than $30 million in investable assets. Although they constitute less than 1 percent of the HNWI group, the Ultras hold more than 35 percent of HNWI wealth.

And even they aren’t the richest group. In the entire world, according to Forbes magazine, there are just 1,011 billionaires—individuals with over $1,000 million in assets. Their combined wealth is $3.5 trillion, an average of $3.5 billion each.³¹

If populationists really want to look for superconsumers, they should study the people who have far more money than any human being needs and who, according to Citigroup’s analysts, spend far more of their income than they save or invest. Stories of profligate spending by the super-rich are legion.

• David and Frederick Barclay, owners of hotels and newspapers in England, bought an island in the English Channel and hired Prince Charles’s favorite architect, Quinlan Terry, to build them a £60 million (US$94 million) castle with thick granite walls, battlements, an 80-meter-long dining hall, two swimming pools, and a helicopter pad.

• British retailer Philip Green flew three hundred guests to the south of France and put them up in a $1,600-a-night hotel so they could attend his son’s bar mitzvah. He also flew in stonemasons and other craftsmen to build a 300-seat synagogue on the hotel’s grounds. The event featured an evening concert by Italian tenor Andrea Bocelli and another by pop star Beyoncé and Destiny’s Child.

• Microsoft founder Bill Gates lives in a custom-built, 66,000-square-foot, super-high-tech house called Xanadu, overlooking Lake Washington in Medina, Washington. Its assessed value in 2009 was $147.5 million. Every door handle was custom made, at a cost of $2,000 each.

• In 2003, another Microsoft billionaire, Paul Allen, purchased the world’s longest pleasure boat, the 414-foot yacht Octopus. It has been bypassed by the 531-foot Dubai, built for United Arab Emirates sheikh Mohammed bin Rashid Al Maktoum. And that boat in turn is now second to the 533-foot Eclipse, built for Russian billionaire Roman Abramovich, a yacht that reportedly includes a missile defense system and an escape submarine.

• Petrochemicals billionaire Mukesh Ambani, ranked by Forbes as the fifth-richest man in the world, lives with his wife and three children in the world’s most expensive private home: a $2 billion, 22-story mansion that features nine elevators, a movie theater, a swimming pool, a yoga studio, an artificial snowfall room in which the family can escape the heat, and 600 servants. All this in downtown Mumbai, a city where six million people live in slums.

And we could go on. As Daniel Dorling points out, the lifestyles of the super-rich can be justified only if we somehow believe that each of them is worth hundreds or thousands of ordinary working people.

Individually these people take up the space that used to house hundreds; they consume fossil fuels and other resources far less sustainably than thousands of others collectively consume, and they demand the time and labor and subservience of tens of thousands of others in mining for their needs, manufacturing for them and servicing them in a way that deprives millions more of the potential benefits of that labor. Just think of all the human work required to create the materials and technology needed to furnish a grand mansion, to kit out a large yacht, or construct a private plane, and then you can begin to comprehend how just one of the world’s many hundreds of billionaires, someone who can spend a couple of million dollars a day on leisure time outgoings, harms millions of other human beings who in total get by on less than that for all they need.³²

The “global sect of greedy gluttons,” as journalist Hervé Kempf calls the super-rich,³³ occupies global ecological space and generates pollution vastly out of proportion to its numbers. Any attempt to attribute the environmental crisis to “American consumption” (or British, or Australian, or Canadian, or . . .) misses the target if it doesn’t recognize:

• The richest 1 percent of Americans take in and spend more than the bottom 40 percent.

• The richest 5 percent of Americans own more than everyone else in the United States combined.³⁴

• The bottom 80 percent of Americans account for less than 40 percent of consumer spending.³⁵

• In Australia, eleven very rich individuals own more than the country’s 800,000 poorest households combined.³⁶

• The 147 individuals who topped the 2002 Forbes “World’s Richest People” list had total wealth equal to the total annual income of three billion people, half of the world’s population.³⁷

In the face of these facts, overpopulation pales as a social issue. To quote Guardian columnist George Monbiot: “It’s time we had the guts to name the problem. It’s not sex; it’s money. It’s not the poor; it’s the rich.”³⁸