One man’s necessity is another’s luxury
When I read about this research* about how Americans are taking a U-turn when it comes to buying consumer durables, about their attitudes changing towards necessities and luxuries, I thought it’s time to see where developing economies like India are at. Are our necessities really necessities, and if they are, then why are they so?
The research also reminded me of the writings of E. F. Schumacher, who had once talked about the limits of growth. He had argued “against excessive materialism and meaningless growth.” After all there comes a point when a human being has all that he needs. And growth, whether of corporations and their products, or the GDP growth of countries, is not reflective of the mental and physical health of its people. Since then there has been criticism about Schumacher’ theories, particularly about their relevance in today’s world. After all industries need economies of scale and they need to reach a critical mass so that they can provide the product at an inexpensive rate. And they need to keep inventing new products to stay in business and to make profits. Competition, which also fuels growth, is healthy too, as it prevents monopolies. But then one has to strike a balance.
Coming back to the research, India is a growing economy and more and more people are coming into money, but does that mean that they should get addicted to luxuries and start believing them to be necessities? Should they get taken in by false and/or fancy advertising which drives them to consume more and more?
This post is not about those who want to enjoy luxuries because they can afford them. Nor am I talking about spiritualism here, but just common sense. Why wait for a rainy day which could force us to cut down on the so-called necessities?
Here are the items which Americans don’t think are the life-savers they thought they were. Three years and a recession did it. What is interesting is the stark difference in the attitude of Indians and Americans towards the same consumer durables. I don’t have statistics on India and my analysis is based on what I have read and my own observation.
Most Americans think a car is a necessity although this percentage would be lower in European countries with good public transport systems. It would also be lower in poor countries where the populace cannot afford to buy cars. In India we are at the crossroads…newer, cheaper, and fuel efficient cars are being launched every year and we have a burgeoning middle class itching to buy them. With India’s limited road infrastructure and the people’s limited incomes, India has a long way to go before people will start thinking of cars as a necessity. However, the fact that many Indians believe two-wheelers to be a necessity points to the our inefficient public transport systems. Unless public transport improves, there will come a time when middle class families will start to see the four wheeler as a necessity.
Where clothes dryers are concerned, over 80% of Americans thought they were a necessity three years ago and it’s interesting to know that this percentage has reduced to 66. It’s doubtful that this trend is driven by the need to conserve energy, and is most likely due to the recession. Considering that a clothes dryer would be useful in many, colder, parts of America, the fact that many feel they can do without it makes one feel that a clothes dryer is indeed over rated. Automatic washing machines do more than half the drying anyway and to have one’s clothes so dry that one has to simply fold them and put them away is sheer luxury. I hope that this product never catches on in India. Our weather tells us that we don’t need it. The disadvantage in India is the rapidly growing population and small living spaces in the cities which make it difficult to find the space to dry clothes.
Indian weather may eschew clothes dryers but it does cry out for home airconditioning! But this is luxury in India, even for the well-to-do. Only the top 2-3% of the population in India may think of it as a necessity. The upper middle classes usually buy a room air-conditioner or two, which is usually installed in the bedroom and used at night. The full house is rarely air-conditioned. If AC’s are used sparingly it’s due to the high power bills and frequent power-cuts across India. India is not ready for home air-conditioning, not just yet. But if 10 years from now we do have the power, I still don’t see why this should become a necessity. Air conditioning is something one just gets used to… or unused to.
It is a little surprising to see that only 64% of Americans think that the television is essential. This is believed to be a consequence of increased gaming and the advent of the computer. Young Americans particularly are veering away from the television. In India, television has become a necessity. Go to a hut in an urban slum or to village hamlet and the chances of seeing a television are high. When it comes to computers, poor Indians are not literate enough to use them, and in any case would not be able to afford them. In urban India home computers are now being seen as a necessity though. People are taking loans and buying computers which are available on monthly payments. Prices have come tumbling down too.
Cell phones are another item which have become a necessity in India due to the higher cost of landlines. Cell phone connections were a boon to Indians as landlines were not easy to come by, with long waiting lists. This isn’t the case anymore, but people prefer the cell over the landline, particularly if is a question of just one connection. The cheap pre-paid card with a monthly outflow of less than Rs 250/- and no deposit has ensured that the majority of Indian families today can boast of a phone connection. In the U.S. on the other hand, it is mostly the young who think of the cell phone as a necessity.
Another statistic surprised me, that only about 35% of Americans think of the dishwasher as a necessity. One imagined from tv serials and movies that a dishwasher is present in every home. Perhaps it is, but clearly the majority of Americans seem to think that they can do without it.
When it comes to high speed internet, flat screen tvs, or ipods, not many in America think of them as a necessity and well, we neither. However there is a niche segment in India which cannot do without high speed internet and/or ipods. I guess if they can afford it why not! I too am thinking of getting high speed internet as I find my present “broadband” connection too slow. But I think of it as a luxury.
I want to end this post with what John Fullerton wrote last year (he is talking of limitless growth and limitless consumption):
We need to pause and reflect carefully in light of what we see happening to the health and prosperity of individuals, whole populations, other species, oceans, the soil, rainforests, the atmosphere—indeed the entire
planetary system—if we are awake enough to notice.
*Note: The Pew Research Center’s Social & Demographic Trends survey on the effects of the recession was conducted by landline and cell phone April 2-8, 2009, among a nationally representative sample of 1,003 adults ages 18 or older. Similar research has been conducted in the past by different polling organizations, and it was the Roper Organization which started these type of surveys, in 1973. If one takes an overview of the results of this kind of research over time, the trends are consistent. There has been a decline about what people think of as necessities in 2009. And for “almost every item for which a trend is available, the 2006 results represented a high-water mark in the necessity rankings.” 2006 was also the year before the recession set in. One will have to see whether the trends will keep going southwards or whether 2009 is simply a blip on the horizon.