VC: VERY Conspicuous Consumption – Why?
By Shlomo Maital
Over a century ago, sociologist Thorstein Veblen published The Theory of the Leisure Class: An Economic Study in the Evolution of Institutions (1899), in which he presented his theory of conspicuous consumption – spending by the rich to display economic power, rather than enjoy goods. In the Nov. 14 2015 issue of “T” magazine, the New York Times’ style magazine, is David Brooks’ article on “The ultimate vacation”. Brooks joined a vacation package organized by the Four Seasons’ Hotel chain, for one week, out of the 24-day total vacation package. His opening sentence: “I tried but failed to ward off the second bottle of champagne”. This is Veblen’s conspicuous consumption — with capital C.
The vacation cost $120,000 per person. For 24 days “you fly around the earth in a Four Seasons-branded private jet, taking off in Seattle and stopping in ..Tokyo, Beijing, the Maldives, the Serengeti, St. Petersburg, Marrakesh and new York, going from Four Seasons to Four Seasons”.
Conspicuous consumption indeed. But Brooks speaks highly of those on the tour. “They were socially and intellectually unpretentious. They treated the crew as friends and equals. They have spent their lives busy with work and family, not jet-setting around or hanging out with the Davos crowd.”
Wow. So the really, really rich, who can spend $120,000 on a short vacation, are nice people after all. Wow.
I would like to raise a few issues, Mr. Brooks.
The rich can do whatever they wish with their money. And some of them really worked hard to earn it, though fewer than you might think (8 % return on assets doubles your money every 9 years, even without doing any work at all). But it is hard not to think about what one could do with $120,000, that goes up in smoke in a short vacation.
* Send a worthy poor student to medical school, after which, the resulting doctor saves lives and cures illness
* Feed entire villages of poor people in Asia and Africa for a whole year
* Provide seed money for startups in emerging market countries, some of which will result in successful job-creating companies
* and the list goes on and on….
I’m sure many of the wealthy on that Four Seasons private jet do some of those things. I just wonder how stable our global society is, when so few have so much, and so many have so little. When a handful jet around the world in private jets, and billions have no clean water or toilets or schooling.
When will those with nothing start to come after those with everything, and destabilize the world? Wasn’t that what we called the Arab Spring ..which turned into a desolate winter? Do we really HAVE to have a world in which the freedom to waste huge amounts of money is an undeniable unalienable right?