Tag Archives: Veblen

The Intrinsic Economy (why the Republicans must lose in the long term)

lady bugsThe shouting! The hyperbole! The balloons!

Thank God the political conventions are finally over. Cleveland, Philadelphia, and television can finally get back to normal.

But the ideological turbines continue to turn. The underlying ideas that drove the conventions do not fall silent but carry on. We harness them every 4 years. In the meantime, they get more powerful.

New ideas of incentive and reward

The only answer that really mattered in the 20th century, certainly the only one that counted as far as economics was concerned, were “extrinsic” rewards.

We worked in the world for “income.” Some people were lucky enough to get intrinsic benefits as well. Doctors got the satisfaction of saving lives. School teachers knew the reward of helping kids grow. Waiters got to wear a tuxedo off duty (Veblen’s “vicarious consumption”). Fitness instructors kept their weight down. The rest of us were paid more or less entirely in dollars, and the intrinsic benefits (if any) were neither here nor there. “Nice but not essential,” as the phrase had it.

Those who worked chiefly for intrinsic benefits were called “inspirational”…but only rarely did they actually inspire anyone to follow suit. They were called “selfless” but this rather implied that intrinsic rewards weren’t really rewards at all. (If they were, we would have said these people were not selfless but well compensated.) Those driven by intrinsic satisfactions were the odd ones out.

That’s changing. You could say that the artisanal tilt in our economy, whatever else it is (and it’s many things), is a shift from people working chiefly for the extrinsic benefits to people working for chiefly for intrinsic ones. Unless you are, say, the Mast brothers, you’re not making a fortune. You are doing it for the joy, the pleasure, the satisfaction. What matters is less what you “make” in the way of income and more what you make in the way of satisfactions.

Some people look askance at those who follow the old model and continue to prize extrinsic benefits. They call them opportunistic and “on the make.” This an irony of the artisanal economy: when you pursue rewards that have intrinsic value to you, you create rewards that are good for the community. Conversely, when you exert yourself to create goods and services for the conventional marketplace, you are seen as old regime, industrial, adulterated and otherwise anti-artisanal. The extrinsic “tribe” acts in the service of discredited consumer tastes and preferences. Fast food, dry cleaning, aluminum siding, that sort of thing. The intrinsic tribe is seen to be a vanguard, fashioning new ideas of economy and community.

This is a big change. Caring about the social good that comes from economic value, this used to be a distinctly minority enthusiasm. For most of us, it was something only contemplated in the tearful last moments of a Frank Capra movie. The rest of the time we were hard-charging, self-seeking individualists. If we are no longer this, but some other kind of creature, well, it’s hard to say how big a change this is.

The rise of an “intrinsic economy” makes for a shift in politics, too. It says that people are less interested in employment rates than the larger robustness of the community. They are asking for a world that employs “the whole of me,” not merely the individual as a skill set and a problem solver. They want to work for an organization (if they want to work for an organization) that says “give us the better, larger part of your selfhood,” and not the usual “please hang that complicated selfhood of yours at the door and let’s get down to business.”

We ask something new of our politicians. We move from “get me a job” to “help me build me a community.” The person we want as politician begins to look less like Mit and more like Hilary, and, eventually, less like Hilary and more like Bernie. The Republican idea has always been: “‘here’s a job in an economy. Let’s see how the rest of the world falls out.” Back to the drawing board for party strategists. When people care more about self fulfillment than status advancement, the Republican party is obliged to revamp. It will respond to this deeper trend in American culture or it will find itself on the wrong side of history.

I can hear several objections:

1) This is all about a weak economy. People care about intrinsic rewards merely because the extrinsic rewards are in short supply. (See an excellent article on this topic by Noreen Malone here.) I take this challenge seriously, and I am setting it aside for the moment.

2) The “artisanal thing” is the preoccupation of an elite group of chefs and patrons in high-end restaurants. This objection does have an answer. The extraordinary growth of Whole Foods tells us that we are no longer talking about a tiny elite inspired by Chez Panisse. And the recent declaration by WalMart that says that it will transition to organic food tells us that still later adopters are signing on. We are beginning to enter the middle of the diffusion curve.

3) The artisanal thing is an episodic trend. It will come and go. It flourished in the 1960s and 1970s and then it went away. It will go away again. Yes, agreed, this trend is episodic but it is also cumulative. Each time it comes back, it gets a little more powerful and a little better established. In this last iteration it leapt from food to the world of spirits (aka the mixology revolution) to the world of retail (the new ubiquity of farmer’s markets). It colonized neighborhoods, cities (Brooklyn, Detroit, Portland, Boulder, etc.) and entire generations. The “installed base” is growing.

The intrinsic economy is changing what we define “incentive” and “reward” and that changes what we want from our careers, our politicians and our parties. None of this is good for the Republican party.

New ideas of the individual: complementary parts or competitive wholes?

The conventional wisdom, well established as a social practice in the period following World War II, was that an individual was a whole unto him or herself. The individual was the unit of decision, the unit of initiative, the unit of membership. The individual was free standing. In the post-war period, there were sexist and ageist exceptions that said some women and all children were subsumed in a “family.” But otherwise the world was comprised of individuals.

In the classic view, individuals competing with one another for resources and the outcome of this competition would decide where they stood relative to one another in the larger social scheme of things. Advantages that came from beauty, grace, family, ethnicity, race, and education existed but, if acknowledged, they were seen to make an incremental difference. The real momentum came from effort and accomplishment.

Competition took place in several media. People competed especially with their consumer purchases. People weren’t so much “keeping up with the Jones” as trying to get ahead of them. They were claiming status by showing status. Successful efforts helped you rise. Bad performances made you fall. Claiming status in a consumer culture helped fashion status and your location in the status hierarchy.

The idea of the free standing individual is changing too. A certain sense of solidarity is emerging. There’s a growing sense that we’re “all in this together.” There’s a refusal to insist on one’s specialness, a disinclination to mark ourselves as special. Trump would have been a narcissist in any era, but he’s especially conspicuous now.

There are measures of this “solidarity reflex” everywhere. There is “norm core” clothing that refuses specialness. The wedding trend moves away from lavish and spectacular. We police social situations by objecting to the “humblebrag.” Luxury cars now engage in “just folks” advertising. A strange example came my way recently when I posted an essay called “Who will be our ethnographic hero?” I got a note from someone saying they would never wish to be seen as a hero.

Or consider this. Wikipedia is the work of 80,000 contributors. With the exception of cofounder Jimmy Wales, these people are unsung. I think it’s probably true that people in the 1950s would have found this anonymity intolerable. They would have preferred not to contribute than to be denied credit.

Perhaps the best measure is the extraordinary rise of social enterprise. Once there were only a couple of enterprises like Tom’s, the company that made shoes available to the Third world on a “one pair given for one pair sold” basis. Now there are thousands of enterprises that do this or something like it. These are not considered “acts of generosity”or “philanthropic gestures.” This is an simple part of the business model. Ask someone why their enterprise behaves this way, and at first they are surprised that you asked. The answer almost always returns to the idea that “it’s important to share” because “we are all in this together.”

This is a big change. We are a culture that invited individuals to individuate, to define themselves as separate, to mark themselves as different, to show themselves to be “special.” (And, please, let’s acknowledge there were always eddies of solidarity, chiefly family and home. And let’s acknowledge that individualism was always in several ways a myth we told ourselves about ourselves. Let’s also remember that exceptions prove the rule, and that myths make a real difference in the world.) If there is a feeling that individuals take as much or more of their meaning and direction from the fact that they are part of a larger social whole, something big has happened.

If we are no longer “free standing” but embedded in something larger, we have changed the way we think about our selves. Competition is diminished. Status matters less. Conspicuous consumption begins to look merely odd. Luxury goods look vulgar and overweening. The status hierarchy becomes the preoccupation of a few. In the unflinching gaze of the social scientist, we have always been embedded in a whole, less free standing that we wanted to think. But now Americans are catching up to the scientist. We see themselves as embedded too.

Summing up

To look for intrinsic benefits of a social kind and to define ourselves as parts of a social whole, these change what we want from politics and parties.

There is no evidence that Republicans are alert to either of these cultural changes. (To be fair, how would I know? I have no access to the Party’s internal contemplations.) Indeed these changes appear to have happened right under the noses of the Party. A few years ago, the party decided to pursue radio as an essential party organ and with the rise of people like Rush Limbaugh it succeeded. But the Party stood idly by as the ideas considered here crept into early childhood education and elementary school. And this much is probably indubitable: story time in the American kindergarden meant more to our present politics than the playing fields of Eton ever meant to the English ruling class.

But then the Republicans have always been a little tone deaf when it comes to culture. It believes that it was always about economics. Where the social and cultural matters appeared to matter, the idea seemed to be that bourgeois conventions of self definition and presentation should stand. (This might be why Fox newscasters all have the same hair style.) And otherwise, we could rely upon individuals to enter the marketplace in pursuit of extrinsic rewards which they would deploy for the purposes of hierarchical ascent in a status competition. At Republican HQ, the old model still pretty much prevails. At Republican HQ, it will always be 1956.

It’s a salutary lesson for us all. Drift this far out of the orbit of American culture and your days are numbered. But let’s not be smug about this. The Republican problem is pretty much everyone’s problem. Some version of it haunts nonprofit institutions like MET, the consumer packaged goods industry like Unilever, luxury automobiles like Mercedes, magazines like Vanity Fair. The intrinsic economy threatens a Tsunami-like disruption.

Thanks to Margarethe Brummermann here.

What Virgin can learn from Apple (and three other thoughts on a plane)

I was trying to charge my phone on my Virgin Atlantic flight home from London and one of the attendants descended on me to insist that I cease and desist.  I tried to explain that a cell phone was essential to meeting up with one’s car service. She didn’t care.

I thought to myself, "this is not what Apple would have done."  Apple had the very clever idea of turning a moment of customer unhappiness into an exercise in the Apple way.  So we enter the Apple store with our wounded iPhone braced for an unpleasant, accusatory, uncooperative engagement with the "support" staff, and lo and behold, the Apple people actually seem to want to help, to shoulder more than their share of the responsibility to put things right, and then to send us on our way with a song in our heart.  Steve Jobs has found a way to colonize and convert the misery inflected on us by product malfunction.  So simple, so smart, and actually not very difficult.

Virgin Atlantic has not got the news.  They have an unreasonable policy.  (The adapter I was not allowed to use to charge my iPhone was perfectly ok to run my ThinkPad.)  This policy has been seized upon by a staff member as an opportunity to play "big nurse."  (How frustrating for a corporation when a member of the corporation uses their power for personal purposes in this way.)  And when I pled my case, she just got worse.  And Virgin looked still more heartless and unreasonable.

You kill yourself to build a brand, and this happens.  Natalie could have found a way to give me an extra 5 minutes of charge.  "Our little secret" and "this is an exception I make only for you" would have augmented the brand wonderfully.  But no.  Natalie was triumphant. And damn the brand.

Everything else about the VA experience, I have to say, was really pretty well done.  I recommend it.  (Just be careful to avoid you know who.)  


BP has now worked it’s way through the Kubler Ross stages of grief and bows before it’s fate.  There is only one way out.  I wish I had thought of it, but I must give credit to Gregg Fraley who over drinks after the London Bootcamp noted that BP needed to make itself the absolute master of ecological calamities, the company to whom the rest of the world turns when something like this goes wrong, the go-to expert from this point forward.  Otherwise, they are utterly the villain of the piece and the brand is a write off.  (See Greg’s blog here.)


I found a piece in The Financial Times on luxury flourishing in certain markets.  That it should do so in China is perhaps not surprising.  In Shanghai a Rolls Royce Ghost costs a quarter of million dollars.  (A Phantom twice as much.)  All the better to send that status message.  But then we are accustomed to seeing classic competitive spending, status emulation, and conspicuous consumption of this kind, and indeed, we have ideas at the ready from Veblen, Simmel and Warner, to name a few.

But luxury is flourishing in other places (and in China, in other ways) and it would appear that these traditional consumer motives are being supplanted by new ones. And then the question is, gosh, really?  Is it possible that luxury purposes serves a new emotional purposes?  Is luxury becoming more private message than a public one?  And does this private message have something to do with defining and securing us in a world awash with change? It seemed to me that some of our collective thoughts on the new Burberry branding on behalf of its trench coat might point in this direction.  Just wonderin.  Do luxury brands have new power?  This is Virginia Postrel territory and defer to her thoughts on the matter (whatever they should prove to be!)


I am reading Lodger Shakespeare by Charles Nicholl.  I am only 20 pages in but already I detect a rising admiration and envy.  How wonderful to have a very clear topic and narrow focus.  This is what we all want: an intellectual undertaking large enough to warrant attention and small enough to limit the facts known and task assigned.  What most of us get instead is a body of knowledge and responsibility that is shapeless, fluid, and episodically inscrutable. Lucky Charles.  He is made a mesmerizing job of it.  


Nicholls, Charles.  2010.  Lodger Shakespeare.  Available from Amazon here.