Photo: connorsmacThere are a cohort of people who are still buying McMansions in the suburbs; I see the photos on Facebook, “Our New Home!” revealing beige wall-to-wall carpeting (still mysteriously associated with upward mobility), reminiscent of the early 90s, chosen to soften the echoes of monstrously high ceilings usually reserved for public spaces. The outside of the home is similarly beige with french windows framed by a brick veneer and a peaked roof that inevitably evokes some strange sense of American pride and envy… for it does look nice if you’re just glancing by in a car.
But despite the constant commercial endorsement of this wearisome American Dream, such idyllic photos no longer sway the hearts or pocketbooks of the majority of young people who have made it clear they will not be the ones to save the housing market. Even the young billionaire Mark Zuckerburg rents, and in the city, not the suburbs.
It wasn’t too long ago that people flaunted materialism. “Goods [were] exclusive or status related rather than universal, private rather than public” reports economist Tyler Cowen. But whereas the automobile enabled freedom for previous generations, today’s generation use digital devices as a means for self expression. That has made possible an economy focused on knowledge and experiences, not consumer goods.
E-book author Ev Bogue took a photo of every single item he owns and encourages visitors to his site to “count, there aren’t many.” His belongings total a fundamental 32 things. Bogue is a proponent of augmented humanity, and encourages his readers to “cultivate presence at the intersection of life and Instagr.am,” a popular iPhone photo app.
“The incentive with these apps is to live a more extraordinary and present life,” Bogue argues. “If you aren’t living, there’s nothing much to Instagr.am, and thus people will forget about you. No one necessarily wants to see an Instagr.am of a desk. We know this, so I don’t often see photos of desks on Instagr.am.”
While Bogue may fall on the side of extreme in the experience economy for his privileged stylings, his penchant for walks in the forest over a new dining set is shared by his peers. We prefer to live by our screens, not among objects, and so the knowledge economy is just that – in our minds (and on our iPads) and not in the revenue-generating sector of the economy.“The funny thing is,” Cowen argues, “getting away from materialism on such a large scale – whatever the virtues of the switch – really, really hurts. It is the hurt that we in America are living right now.”
We assumed innovation would arrive the way it always has, but technology gave innovation new forms, and insistence on the-way-it-always-was kind of economy subsequently delivered the situation we’re in today: a growing income inequality, stagnant median income, and the financial crisis.
Cowen admits “you can be an optimist when it comes to our happiness and personal growth yet still be a pessimist when it comes to generating economic revenue or paying back our financial debts,” and “even if we can, at the personal level, manage to feel fulfilled under slower economic growth, it is not compatible with how modern politics [and economics] is structured, namely as a ravenous beast.”
Obviously Cowen knows something screwy is happening. But for all of Cowen’s awareness of trying to fit a square peg into a round hole, he never goes as far to eschew the current economic framework, a system simply not suited for a knowledge and experience-based economy.
That system is legacy-based, and its “operating system for money is obsolete,” argues media theorist Douglas Rushkoff. “It is optimized for a different era than the one we are living in today. It is incompatible with Web 2.0 and the Interneted world.”
The Internet has allowed an economy where money, the dependency and abstraction of which has caused the financial crisis, is not the singular centralized currency. On the decentralized web, reputation is a currency. Authority is another. Data, influence, badges, credits and identity are also currencies. There are several currencies on the free and open web in fact – none of which are widely recognized at J. Crew. Increasingly that’s because the point is not to exchange value for consumer goods, but for the stuff inside our screens.
I’ll take a deeper dive into the economy and currencies our digital lives are creating in part two of this post later this week.
17 replies on “How the iPad is (Thankfully) Destroying Our Economy”
Being in an econ class now, I understand where you’re coming from. It’s one thing to have us consider more meaningful purchases, and another to have theory that seems to support “Spend, spend, spend!” What I’ve learned, however, is that it’s not quite the theory that’s all wrong, it’s us. Based on our own perceptions of preference, we have options for what to buy, how to purchase, and at what price we’re willing to pay. We can choose not to buy, which is what I think you’re getting at. However, even though the Recession may have caused a shake out of the weaker links, we still have way too many options. At some point, we know that the economy is saturated with too many of the same, and I would argue that the freedom to start a business has been more compelling than the idea of actually coming up with something people want or need. Even our generation, one that might want to rise above traditional economic pressures, can be just as guilty. I have friends who don’t care what they do, they just want to start companies. That might be a viable option, but does the economy really need those extra companies that aren’t actually contributing to the betterment of technology, innovation, industry, etc.? No. And they may be one end of the spectrum, and you can have Gen-Y entrepreneurs who actually add value, but it’s going to be something we all need to fix.
Amazing comment, Emily. I think you’re right on in that it isn’t fully the system that is bad, but our fully corporatized behaviors within that system. I do think we’re in a half-changed world with half-changed minds and we’re struggling to support a way of consumption that simply isn’t sustainable anymore, and yet, is all we’ve known.
And great observation about starting a company; I fully agree. It’s the hip thing to do to start a company, but to truly add value, particularly to truly build innovation, it’s going to take more than just jumping on the bandwagon.
I’m going to think about your comment some more today, thanks for weighing in!
“What are you solving?”
If you don’t have an answer, then what’s the point?
Love that Emily Jasper insight! :)
This is hard to explain to Baby Boomer parents who think that renting is “throwing money away.” I really like that Gen Y places more value on minimalism and experience, and I hope that it is something that will stick, despite the economic pains associated with lower consumption. Although, student loans will stop many members of Gen Y from rising to the same level of materialism as our parents. We couldn’t keep up with the Jones’ even if we wanted to, so we might as well make it the cool thing to do.
I’m glad you brought up student loan debt, Meghan, because I think our current economic system reinforces debt and so that’s why it’s so difficult to escape it – particularly for those in the older generations. As younger generations become more entrenched in digital lives, I think (hope?) debt will be less and thus, an improved economy will result. Less materialism definitely seems like the cool – and more fulfilling – thing to do and that’s why it fascinates me that it’s the worst possible thing for our economy. Before we can enter any sort of knowledge/experience or gift economy successfully – which has the potential to bring in an era of new wealth – we will need to pay off our debt.
I think and hope that we will decrease our debt and become healthier as an economy too, Rebecca. I agree – we’ll have to go through a period of adjustment to get there.
Speaking of student loan debt, I’m really interested to see what happens with higher ed over the next decade.
A year ago my car was totalled and I was faced with the decision of buying, leasing, or just relying on Zipcar. I ultimately decided to buy because 1. I need a car for work and generally enjoy having a car and 2. Suze Orman told me that leasing is for dummies. I often regret my decision and wish that I would have leased instead. I was in this mindset of needing to own something and have given up on ever owning a home because of my monumental student loan debt. Now I am in a position of feeling stuck by being locked into a 5 year payment plan when I could have spent that money on other things – experiences – if after two years I felt that I no longer needed a car.
I’m hoping that Gen Y moves away from this ideology of ownership and materialism and places more weight on experiences and ultimately a more fulfilling life that isn’t spent worrying about our debt.
I had to buy a car for my current position and while there was no way around it, I wish I had sold it the moment I moved to DC (since I now work remotely), because it’s been nothing but a ball and chain ever since. Even with best of intentions, it’s often too easy to get stuck in this model of consumption. I think the digital generation is moving away from this; it’s just a matter of seeing how it will all shake out in the end :)
i nodded throughout reading this because i’m all on board on less is more/rent, not own/dave-ramsey no debt, most of the principles you outline. however, the article you tweeted this afternoon about higher education seriously has me stressed. i feel pressure to go back to school to move up in the corporate ladder, but i’m in complete agreement with peter thiel’s points that the debt from the “fancy school” can hold you back from the future you want in the first place. if it’s not grad school, what are regular folk going to do to get ahead?
In my opinion, they are definitely not going back to grad school. They’re just working hard, executing and asking for raises and promotions. Getting results is what gets you up the corporate ladder, not schooling. Some people use schooling because they aren’t as good at getting results. There are very few jobs where you actually need an advanced degree. Curious, why do you feel like you need to go back to school? What area are you in?
Communications, at a very large corporation. I’ve worked for 3 years and am pretty much still known the much (much) younger teammate that does “fun” projects like writing, planning events, etc. I want to move up (or on) but can’t figure out what I’m super passionate about and thought maybe I can figure it out at school. It’s a very frustrating position.
So I’m going to dole out some unsolicited advice… take it or leave it as you will :) Unless you really love the corporation you’re at, it might be time to hop to another company. That could encourage your corporation to offer you what you want or at the very least you’ll find what you want at a new company. And, because it’s impossible to know what you’re passionate about without trying it, that’s really the best solution. You may think you love PR, but until you do it day-to-day, you won’t know for sure. Going to school doesn’t help you discover your highest values. Alternatively, if you don’t want to change jobs, you could try extended job-shadowing or internships or even ask your company if you could try different positions within the area. The key is to ask and do. Not think and sit :) And that kind of circles back to the theme of this post – experiences! ;)
i appreciate it! i’m looking forward to part 2 of this article, as well.
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