#108: The Value of Ostentation

This is mark Joseph “young” blog entry #108, on the subject of The Value of Ostentation.

As sometimes happens, one of my political web log entries got me involved (I hesitate to say “embroiled”) in a discussion.  This time the post was mark Joseph “young” web log entry #105:  Forced Philanthropy, and the argument was carried on Facebook.  In that discussion, someone said

I would just rather live in a world in which people don’t starve while others walk around with $5000 purses and $25,000 watches.

My gut reaction was to agree with that–but then something in my brain started nagging at me.  Why?  That is, what does the one have to do with the other?

The half million dollar Audemars Piguet Diamond Fury ladies' wristwatch
The half million dollar Audemars Piguet Diamond Fury ladies’ wristwatch

I got to thinking about that expensive purse and that expensive watch.  The very definition of “expensive” means that our ostentatiously wealthy person parted with a large amount of cash to obtain it.  I expect that somewhere there are designers who themselves are becoming ostentatiously wealthy from the sales of their products, but ultimately someone–undoubtedly several someones–is getting a paycheck.  I don’t know that it matters whether that money is funding a few very healthy paychecks of skilled craftsman or a lot of factory wage checks for employees–it is moving the money from the bank accounts of very rich people to the wallets and pocketbooks of ordinary working-class families.  It is creating jobs.  That expensive bauble is proof that that wealthy person parted with a large sum of cash.

So it seems that in some sense the purchase of those expensive purses and watches is money going to feed someone other than the very wealthy owners of said baubles.  It is in that sense communicating exactly the opposite of what the critic perceives–not money wasted that could have fed people, but money spent to provide paychecks so people can eat.

Sure, some of it goes into nonsense like all those diamonds that stud the watch, but ultimately we’re still talking about money moving away from the wealthy bauble purchaser toward the working classes.

The objection seems rather to be that the wealthy person is showing off how much money he has by spending it on severely overpriced merchandise.  Why should anyone spend that much money on a handbag?  Indeed, our wealthy person could have walked into Walmart and purchased a perfectly functional handbag for under twenty dollars.  My wife does so frequently.  It seems that the only reason to spend more than that is to have something that will say, “Look at how much money I wasted on a handbag, because I am so incredibly rich that I can.”

Of course, the makers of those expensive products will argue that the price is justified by the quality.  The purchasers, likewise, will say that the products they bought are genuinely better in real ways than the ones everyone else buys cheaply.  After all, “cheap” generally means both that something doesn’t cost much and that it isn’t worth more.  What we have a hard time imagining is that the expensive handbags and watches and other baubles are really worth what the wealthy pay.

That may be something we cannot genuinely or fairly assess.

I have never played a Stradivarius; I have heard a few of them played, but only reproduced over computer sound systems.  They’re said to be priceless, and those few people who have the opportunity to play them believe them to be worth every penny paid for them.  How can I know?  I’ve played a few violins of varying quality, and would say that some are worth more than others, but I cannot really imagine one being so much better that it would be worth as much as that.  I have played a couple of Fender Stratocaster guitars.  They’re good guitars, but I’ve always had the feeling that they were way overpriced–you can get a decent electric guitar for a tenth of what some Strats cost.  Yet there are professional musicians who won’t play anything else, or at least who insist on having one in their collection for use when they want it.

I agree that some instruments play better than others.  When I was in high school, tenor saxophone was one of my instruments.  I often wondered whether I could play alto, and one day I saw an alto sax lying around and tried it, and was impressed with how nicely it played so I looked at the stamp–and discovered that it was the band director’s instrument.  I once picked up a Rickenbacker bass, and it was also very nice.  I’m not sure what these instruments cost, and I’m not sure I could justify spending that much on one.

On the other hand, when I was in The Last Psalm I purchased recording tape for every concert.  RadioShack® then had three grades, and I bought the cheapest for the first few years–and told the sound engineer that as soon as I could hear the difference, I would upgrade to the better grade.  I did so for the final years of the band’s run, because my hearing was better.  I wonder today whether the costs of producing high-quality recordings are worth it, because most people listen to low-quality mp3 copies on low-fidelity equipment.

The point is, an assessment of the quality of a product and the value of that quality is an essentially subjective question.  I can’t imagine a watch being worth as much as that, but some people see it as a quality issue.  If someone puts that kind of effort into producing a product that is in some way better than the norm, and can persuade wealthy people to pay that much for it, that is probably overall better for the economy than having the wealthy people buy the ordinary quality products at the ordinary price.

And the rich person who spends five thousand dollars on a designer handbag instead of twenty dollars on a practical Walmart model has parted with an extra four thousand nine hundred eighty dollars that has gone into paychecks that feed ordinary people somewhere.

So what is it that bothers us about these ostentatious baubles?  Perhaps more precisely, what is it that we want instead?

Some of us want there to be no wealthy people in the world.  Of course, as one of the people in the referenced conversation reminded, half of everyone is below average.  He was speaking of intelligence, but it’s true of wealth as well, and so is the converse:  half of everyone has more than average.  I might feel it unfair that Donald Trump owns his own hotels or Hillary Clinton can jet to Europe on a moment’s notice without checking her bank balance, but I might as easily object that my neighbor could afford to install automated lawn sprinklers or an enclosed garage.  Some people will have more, some will have less.  It is the nature of such differences that they form a bell curve, and it is the nature of natural bell curves that the extremes are extreme–fewer and fewer people having more and more (or less and less).

We can, of course, try to alter that unnaturally–perhaps create a tax that takes 100% of all income or assets over a certain amount.  That is problematic on so many levels.  A fixed amount means that the inflation which drives down the value of a dollar correspondingly drives up the amount of money that is needed for the same standard of living, and so more and more people will hit the ceiling.  It is also detrimental to the economy:  if after this point I am not making any money, why should I work?  That also applies to questions like why should I invest–I won’t hire the people to build the new hotel if once it is finished I make no additional income from it.  No, putting a ceiling on income is not a good plan for the economy; the fact that people can become incredibly wealthy is one of the incentives that drive economic progress.  It is also one of the incentives that drive technological progress:  people invent new devices in the hope that it will make them rich.  It also drives people into popular culture, giving us movies and music and other art forms, as well as star athletes.  You can’t both have the incentive that people work hard to make a lot of money and the limit that no one can be ostentateously wealthy.  That part does not work.

Perhaps we feel like there shouldn’t be anything we, ourselves, cannot afford if we want it.  That is, if I admire your car, I should be able to afford to buy a similar car–maybe not today, but within a few years if I work at it.  Everyone should be able to afford a basic standard of living much higher than everyone can afford–a car, a house, a college education for his children.  What about a boat?  What about an indoor swimming pool, a private indoor gym, a personal jet?  What defines this minimum standard of living?  The reality is, and has always been, that some people will have more than others, and those who have less will be envious of those who have more.  It does not really matter, as we just noticed, how much more or less; the envy exists because it is never exactly equal.

Perhaps that aspect of things we cannot afford goes the other direction:  handbags and wristwatches should not cost that much, no matter how good they are.  How much, though, should they cost, and how do we decide this?  If I can sell the rights to a song I wrote for thirty dollars, is there a reason why I can’t sell the rights to a song I wrote for thirty thousand dollars?  J. K. Rowling sold the rights for the first printing of the first Harry Potter book for a paltry sum; by the time she finished selling the movie rights for the seventh book, she was (literally) richer than the Queen.  Can it be said that the books were not worth that much money?  Obviously the movie producers thought they were, and presumably made much more on income from the movies than they paid her for the rights.  Would we be screaming that she got shorted if they paid her a lot less?  And why, then, should it be different for a handbag or a wristwatch?  Pricing is not arbitrary:  it is based on what people are willing to pay.

So why are wealthy people willing to pay so much for baubles which perform functions suitably managed by considerably less expensive items?  Perhaps that is our objection:  they do it to get attention, to display their wealth, in essence to be ostentatious.  Is that what bothers us?  What is interesting about that is that it only bothers people who care about it.  I would not know the difference between a five dollar pocketbook and a five thousand dollar handbag.  I might be able to tell if I examined it closely that one was better made than the other, but at a glance it means nothing to me.  It only means something to two groups of people:  those who can afford such expensive objects, and those who wish they could and so read about them and drool over them.  The cost of these baubles only matters to people who want to show off and to people who are impressed by them.  The rest of us don’t really care how much it cost.  If I knew how much the handbag cost, my impression would be that had I that much money, I would spend it on something I would enjoy a lot more.

But then, I don’t have that much money, and I don’t really know what I would want to own if I had it.  Would I buy a Stratocaster?  A Stradivarius?  And that raises the question of what we want these wealthy people to do with their money instead.  Should they hide it in storehouses like King Midas?  Should they spend it on armaments or their own personal armies and fortresses?  Should they buy companies, and so make more money?  However they spend their money, it is going to be ostentatious in the eyes of someone.

We would rather have them give it all away to people who have less.  Even when that doesn’t mean “including me”, it is still asking them to spend their money for our benefit:  if they give their money to aid the poor, we don’t have to part with so much of ours and don’t have to feel bad about not being able to do more for the poor without suffering more ourselves.  We don’t have “enough” money for ourselves.  However, a long time ago I learned about the concept of rising aspirations:  the more money you have, the more things you perceive as necessities.  Does anyone really need two televisions?  Two cars?  Two warm coats?  We complain about ministers who own their own personal jets, but these are people who have to travel to the places they have been asked to speak and arrive comfortable and refreshed, so they see these as needs.  No one has “too much” money; everyone can think of what he would do with a little more.

And if we get wealthy people to spend money on ostentation, we get that money into the hands of poorer people as surely as if we were to tax it or coerce them to contribute it to charity.  We get them to part with that money voluntarily, not under compulsion; and we do so in a way that creates jobs instead of making more people dependent on our generosity or pseudo-philanthropy.

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