There are many reasons that the economists trusted by both Democratic and Republican administrations in our country (over the last several decades) have built a kind of dream world where numbers on calculators and the super-rich thrive while the rest of us slide, in starts and fits, into the poor house. One fun example is the Consumer Price Index (CPI) and what’s known as the “quality bias.”
I’m sure everyone realizes that the CPI has risen steadily over the last 60 years. The CPI is an indication of what consumers have to spend to obtain what the government considers sort of a representative basket of necessities such as food, clothing and several other commodities. Increases in the CPI show how much more it costs to live in the present time versus some time in the past.
But economists often argue that the CPI does not pay enough attention to changes in the quality of the items in that “basket.” In some cases, they are right. Take cars, for example: even the cheapest new car will almost certainly outlast a comparable car from the 1970’s, and it will most likely require a lot less maintenance and upkeep.
But economists and many policy makers assume that this applies to everything, and that simply is not the case. Take socks, for example. I have, over the past few years, bought two sets of Champion and one set of Adidas ankle length socks from Costco. The Champion socks changed, between my two purchases, and then were ditched by Costco in favor of the Adidas.
Costco usually has pretty good stuff. And while I’m always embarrassed for buying anything there instead of a local, “mom and pop” type store, I sometimes give in when a relative with a membership wants me to tag along.
The sock progression went like this: I bought the first set of Champion socks about 6 years ago. They sort of gradually deteriorated, much as I would expect socks to do. The last pair out of this set is still in rotation in my sock drawer. Since the first of them did get holes in the bottom of the heel after about 1 1/2 years, I bought some more, even though they had changed in style just a little. This second batch started to get holes within six months, but I still have one good pair left.
So, to make up for the new deficiency, I bought what Costco had to offer, the Adidas socks. These lasted a few months and then all formed holes, almost simultaneously, in much less than a year. However, one or two of them is still hanging on, with a really thin layer of material on the heel where a hole is trying to form.
This provides some evidence as to what has happened to the quality of socks over the past few years as manufacturing has evacuated the United States more and more and landed in China and other faraway nations, all while companies have searched high and low for ways to cut corners in materials and labor costs.
The socks I bought six years ago, the socks I bought three years ago, and the socks I bought one year ago have all basically, finally died in the last six months. That means that the first ones lasted over 5 years and the newer socks suck in comparison.
And socks aren’t the only things. Gradually, almost all metal has been replaced by plastic. Almost all nuts and bolts have been replaces by plastic fasteners that get brittle and break and are impossible to replace. These days, you feel lucky if a small appliance like a toaster or a vacuum cleaner or a microwave last three years.
If you look at the ratings of various products on Amazon.com, you get the idea that 5 to 10 percent of new products are DOA – Dead On Arrival, and have to be sent back. And even though I’ve said that cars are the exception, there are still plenty of lemons that come off the lot and go right back into the shop.
The corporate model predictably leads to this. The automotive industry is one of the few where things still work the way they are supposed to work – if you make an inferior product, word spreads and you are punished. With so many other products, a brand enters an elite, dominant group, and then it hardly matters. You can put whatever crap out there you want to and people still buy it because there are so few choices and they all follow the same philosophies.
I recently bought some Hanes socks. We’ll see.
Tom Rossi is a commentator on politics and social issues. He is a Ph.D. student in International Sustainable Development, concentrating in natural resource and economic policy. Tom greatly enjoys a hearty debate, especially over a hearty pint of Guinness.