Time for Things Labor, Leisure, and the Rise of Mass Consumption

2 Time for Things

The conclusion Keynes drew from his brief exercise in futurology was that the productivity gains yielded by capitalism would, in the long run, inevitably lead the economy to enter into a stationary (or “steady”) state, in which material wants would be satiated. Further increases in productivity would then have the efect of reducing the need for labor, radically diminishing the length of the working week. The result would be an utter transformation in the moral fabric of capitalism, returning pecuniary motive to the marginal place it held in previous eras of history and opening up new possibilities for human flourishing. Keynes predicted that in the coming era of abundance, “we shall once more value ends above means and prefer the good to the useful.” To be sure, there would be a period of adjustment during which people would have to cultivate the skills and sensibility necessary for them to be able to fully enjoy their liberation. Indeed, Keynes thought that such is the cultural momentum, under capitalism, behind work for work’s sake, that people might for a while voluntarily arrest the decline in work hours. He imagined people resisting working for fewer than fifteen or so hours each week, for no good reason other than to keep themselves busy. But they would certainly not choose to work more than that, for “three hours a day is quite enough to satisfy the old Adam in most of us” (Keynes 1930, p. 369). In efect, capitalism, conceived of as a system of self-exploitation and the fetishistic pursuit of monetary gain would abolish itself—or, more precisely, would evolve into something utterly diferent—simply by virtue of following its natural developmental trajectory. The Faustian pact made at the dawn of the modern era, having achieved its goals, was thus destined to be undone. “Purposive man,” to use Keynes’s phrase, would be laid to rest, having served his purpose admirably.2

In 2005, a group of eminent economists, including such luminaries as Robert Solow, Joseph Stiglitz, and Gary Becker, was invited to contribute essays to a book intended to evaluate Keynes’s predictions about the future of capitalism (Pecchi and Piga 2008). The historical data analyzed by these economists showed that Keynes’s growth projections were, if anything, on the conservative side. His predictions for growth, based on a long-run estimate of about 2 percent per year, yielded an upper bound eightfold increase in per capita wealth over the next hundred years. Fabrizio Zilibotti found, however, that in the fifty-year period between 1950 and 2000, average world economic growth was 2.9 percent per year, quadrupling per capita output.3 Projected over one century, that rate of growth would produce a seventeenfold increase in the standard of living, twice as much as the upper bound predicted by Keynes. Most of the growth in the earlier part of the period took place in advanced capitalist economies. In Organisation for Economic Co-operation and Development (OECD) nations, between 1950 and 1970, population-weighted growth levels reached an impressive 4 percent per year.4 And yet despite the impressive rate of per capita growth, Keynes’s prediction of the dawning of a new era in which human beings would be progressively freed from necessary labor, and therefore increasingly able to pursue life-enhancing practices, was not, by the early 2000s (when the economists examined the issue), even remotely close to being realized. By the late 1940s full-time weekly working hours had stabilized at around forty across the industrial capitalist world and failed, thereafter, to fall much further, despite tremendous growth in output per hour of work in the second half of the century. Indeed, there is evidence that toward the end of the twentieth century, work time in some parts of the industrial world increased, even as productivity gains marched relentlessly onward.5

Economists ofer a range of explanations for the failure of Keynes’s prediction, some of which are close to being circular. One explanation is that work is itself a source of utility—surely that must be so, the reasoning goes, or else why would people not choose to cut their hours? Alternatively, material wants must indeed be insatiable—why else would people choose income over leisure? Other explanations ofered are more substantive: consumption under conditions of afluence becomes driven by status-seeking one-upmanship, and the demand for positional goods (which index relative position in a status hierarchy) can never be exhausted; growing inequality induces a widespread fear of downward social mobility and so increases the incentive to work in order to close the income gap; higher income creates new needs, such that needs are not fixed but rather change with economic growth. These explanations surely have something to them. No one could sensibly deny that some people find some value in activities for which they happen to be paid, nor would it be wise to underestimate concerns about status and the role of conspicuous consumption in status competition. However, the explanations ofered do not, for reasons set out in the next chapter, satisfactorily account for the dramatic degree to which Keynes’s vision of the future failed to come to pass.6 Indeed, the very fact that there is such disagreement between the economists on why, in the wake of growing afluence, work failed to retreat more than it did, indicates the dificulty of the puzzle.

Introduction

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4 Time for Things

Closely related to the question of why work hours failed to decrease more as productivity went up is the question of why consumption continued to increase so relentlessly. Productivity gains, in lieu of reduced work time, were turned into higher real income, which was used to fund more consumption. Why is consumption, like production, seemingly unbounded under capitalism? There is clearly a plausible explanation for the unending expansion of capitalist production: Capitalists try to outcompete one another by increasing productivity, seeking to turn lower costs into a bigger market share by cutting prices and expanding output. Yet it is not at all clear why efective demand should keep up with expanded output—why, in Keynes’s terms, the demand for commodities should prevail over the demand for free time, even though the relative value of those commodities should, it seems, decline with growing afluence. This ongoing growth in consumption is especially puzzling given evidence that suggests that the relation between wealth and well-being is far from being a simple linear one in which added increments of wealth add increments of well-being.

The question of why and how the production and consumption of commodities should have come in modern times to so dominate human beings is a venerable one in the history of social theories of capitalism. It was posed in perhaps its most general and powerful form by Karl Marx, for whom the most fundamental contradiction in capitalism is between the degree of freedom made possible by advances in the forces of production and the form of life actually realized (and realizable) under capitalism. The capitalist system, for Marx, represented a kind of false necessity (albeit, in his more teleological moments, a developmentally necessary one) that history was destined to transcend.

From a diferent perspective, the question also underlies Max Weber’s theory of the historical and cultural underpinnings of capitalism. For Weber, the growth dynamic of capitalism is precisely what separates it from the comparatively static economies of “traditional” societies. While Weber was interested in the spirit that drives the unremitting increases in productivity under capitalism, the other side of the equation is that which allows for the absorption of an ever-increasing volume of products (Weber [1930] 1992). Weber suggested that the methodical, rational mode of economic action and organization that underlay the ascent of modern capitalism was driven by a quest for psychological reassurance by way of the accumulation of objectified value, rendered visible as money. Money provided a metric by which success, and therefore virtue, could be measured.7 But crucially, instrumental reason could not be monetized—therefore quantified in a general, public form, one amenable to comparative assessment—unless a ready market could be found for the things it produced. How could the productivity of capitalist A, making widgets, be compared to capitalist B, making pots, if their products were not converted through sales into money? A condition of possibility for the economy becoming a domain within which the Protestant ethic (and its secularized spiritual descendants) could express itself was thus a dynamic consumer market, capable of absorbing the ever-greater volume of products churned out by a system of production ever more regimented by instrumental reason, and converting it into a generalized, quantitative sign of value.

Bringing the concerns of Marx together with those of Weber, the question of the unbounded and irrational character of capitalist modernity was also a central concern for later generations of Marxists, most prominently those belonging to the Frankfurt School. They asked: How is it that the accumulation of wealth and refinement of technique, which should be merely a means to the end of the good life, become in efect ends unto themselves? Why, under capitalist modernity, does instrumental rationality become so systemically entrenched, unable to mature (as Keynes thought it would do) to the point of becoming (as reason suggests it should be) just a means to a higher purpose? True to their Marxian roots, the Frankfurt theorists tended to focus on cultural forms generated by the organization of the relations of production—yet they clearly also saw that without mass consumption modern industrial capitalism could not function.

The stakes in the puzzle represented by this configuration of ever-increasing production and consumption are, of course, very high given the extraordinarily urgent environmental problems of our age. Despite much talk about deindustrialization, the shift to services, and the rise of the “knowledge economy” under late capitalism, the capitalist system of production and consumption is pressing harder than ever against the limits of nature. So not only is the materialistic bias of capitalism questionable from the proximate perspective of the well-being it yields, but it in addition threatens the longterm future of the species.

This book is an extended investigation of this puzzle. My objectives are to delineate its conceptual structure, analyze its empirical basis, and build a historically grounded theory in light of which the puzzling pattern of work, productivity, and consumption becomes less puzzling. I follow the tradition, rooted equally, although in very diferent ways, in Marx and Weber, of doing social theory by thinking about history. While I consider general trends under capitalism in the industrial world, the empirical side of the book focuses on the United States, especially during the middle decades of the twentieth century.

Introduction

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My contention is that the reason why work failed to retreat in the face of relentlessly increasing productivity has much to do with the rise of practices and institutions associated with mass consumer society. Yet to adduce the supposed benefits of consumption as an adequate explanation for the failure of Keynes’s prediction to come true just raises the question of why spending should have seemed more beneficial than free time. After all, it is not unreasonable to expect that as incomes increase, so the demand for leisure will also increase. Canonical economists such as Frank Knight (1921) and Arthur Pigou (1932) certainly thought as much.8 With higher wage rates, the relative value of leisure should, according to these economists, increase, and workers should consequently feel less inclined to ofer their labor.9 The prediction that follows from this is that other things being equal, with growing afluence the supply curve of labor should become backward sloping. And yet the historical pattern under industrial capitalism between 1930 and the present day indicates not much evidence in support of that prediction. At the same time, there is evidence from late nineteenth-century America that workers in that period chose to use increasing hourly income to buy back their time—meaning that the supply curve of labor was, in the decades before the turning of the twentieth century, indeed backward sloping (Dora Costa 1998b, 2000a). So it has certainly not always been the case that increasing hourly wages has led to more consumption rather than less work. Yet after a certain point in history that is how things quite consistently went. We are thus left with some unanswered questions. What changed to make consumption as unbounded as production? Why did the value of free time apparently decline in relative terms as afluence increased? What was it about the set of institutions, practices, and moral norms associated with mass consumption that might have caused a shift in aggregate preferences away from free time and toward the accumulation of consumer goods?

I think that the answer to these questions might be found by attending to the problem of wage-labor commensuration and to the development of a form of consumption that seemingly resolves this problem. The problem of wage-labor commensuration is that the legitimacy of wage-labor exchange depends on labor being commensurable with its wage, but it is entirely unclear how the concrete activity of work could be commensurable with the wage, which, after all, is just an abstraction. The possibility of commensuration between wage and work rests, I argue in this book, on goods being framed and construed as stores of potential free activity. When wages are spent on goods that signify hypothetical durations of activity, wage earners receive a form of compensation that seems commensurable with the life activity they give up in labor. The actual time and freedom lost as work is compensated for by the notional free time indexed by consumer goods—and specifically, consumer durables, a category of product that became increasingly important in twentieth-century capitalism. Caught in a cycle of commensuration, wage workers were willing to take their share of rising productivity (realized as increasing hourly wages) as more consumption rather than more free time.

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Time for Things

The commensurability of labor and wage made sense in the context of a particular understanding of the grounds on which an economic exchange can be considered fair. On this understanding, economic exchanges are fair when there is an equality between the exchanged substances. The emergence of mass consumption was closely connected to the increasing de facto legitimacy of wage-labor exchange, under this historically particular understanding of economic fairness, applied to wage labor. The fairness of wage labor exchange became possible through the establishment of an objective equivalence between labor and wage goods, as those goods came to signify free activity. This version of economic fairness was most clearly instantiated in the moral economy that underpinned the mid-century “Fordist” period of capitalism.

The Character and Scope of the Argument

The approach taken in this book is interdisciplinary, ranging across all the social sciences and diverse currents of historical research while also drawing on philosophical works. Especially in the theory sections of the book, I discuss a variety of sometimes conflicting paradigms. I ask my readers to consider approaches to social and economic phenomena with which they might be unfamiliar or perhaps might even think self-evidently wrong. The discussion turns on a dime, as it were, from neoclassical economics to Marxian accounts of capitalism, from economic anthropology to sociological theory, from political economy to behavioral psychology. At the same time, the book combines economic analysis, historical synthesis, sometimes quite speculative social theorizing, and interpretation of culture, bringing together methods and approaches that have their homes in diferent disciplines. But there are good reasons for tromping freely across disciplinary boundaries when considering big questions of the sort that are at the center of this book. When faced with very complex, multifaceted problems, the best approach is to regard the human sciences as a diverse tool kit, and, in order to gain some leverage on the problem, try out as many theoretical approaches and concepts as possible.

Introduction

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My historical analysis focuses on the United States. At the same time, I often refer to advanced capitalist society in general, especially during its postwar Golden Age era, as my unit of analysis. As noted in Chapter 2, the general puzzling pattern of work time, productivity, and consumption is present to varying degrees in every afluent capitalist society. Given its focus on the United States, I certainly would not want to claim that the evidence examined in the book provides strong inductive support for the theory across all advanced industrial capitalist societies. The aim of the book is better understood as abductive rather than inductive. That is, my objective is to construct a hypothesis, one that seems suficiently plausible to be worth exploring in other contexts.10 The analysis of patterns in US history, in addition to providing some empirical support for the argument, also serves as a heuristic for the development and exposition of the general theory.

The largely abductive aim of this book shapes the structure of the argument. It begins by drawing attention to a state of afairs that has struck many as surprising and, therefore, as standing in need of explanation. I then set out a theory of the relationship between wage-labor exchange and consumption under capitalism from which, if true, the surprising state of afairs would follow as a matter of course. I give some historical grounding to the theory, focusing on the United States, which I take to be a good case to illustrate the more general puzzle. My strategy is to show how the theory illuminates a wide range of phenomena related to work and mass consumption under capitalism. Considering the degree to which capitalism encompasses every dimension of social, cultural, and economic life, going for breadth of empirical analysis seems well advised.

The point of the empirical work is to substantiate the theory to the degree that it takes on some prima facie plausibility—providing grounds for thinking that this particular abduction might be worthy of further investigation, perhaps in delimited contexts, which might be more amenable to inductive testing. If readers conclude that the theory seems convincing in the case of US capitalism, they may go on to ponder how much light it might shed on other capitalist contexts. The empirical analysis of the United States serves as a guide to what sorts of institutions and practices to look at in ascertaining whether a similar dynamic might be at work in other places in which mass consumer capitalism developed. In other settings, there are, of course, bound to be mediating factors that complicate the picture.

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Time for Things

In sum, the objective of this book is to construct a compelling, historically grounded theory to account for a quite general pattern in industrial capitalism. The advantage of specifying the theoretical argument on a general level is that by doing so it becomes suficiently perspicuous and context-independent to be easily transposable to other settings. Fleshing the argument out through analysis of the United States makes the basic theoretical argument more concrete while providing some evidence for it in at least one case.

A Note on Use of Terminology:

Use Value, Use Power, Utility

Notions of use and usefulness are central to the argument of this book. Three terms are used to refer to diferent dimensions of usefulness: utility, use value, and use power. Use value and utility are common in economics and political economy, and there is a good deal of overlap between their meaning in those fields and how the terms are used in this book. Nonetheless, my deployment of the terms is in some ways idiosyncratic, so a brief account of how they are used is in order. Use power is an addition to the array of concepts that deal with usefulness, so it needs defining.

Utility: I use utility to mean the actual satisfaction realized by some state or activity. I take utility to be somewhat vague—a rough sense of how satisfying things are rather than a precise metric for satisfaction. I would not want to claim that utility is merely an idea—at some basic level, it has roots in real human needs and desires. But as society becomes more afluent, those needs and desires become more complex, and indeed often contradictory, which makes utility an increasingly dificult and elusive concept.

Use power: By use power I mean the capacity of an object to facilitate some useful activity. For example, the use power of a bicycle is its capacity to make possible the useful activity of cycling. Use power is determined by the material properties of the object as well as its symbolic associations and is conditional on the opportunities an individual has for making use of that object under specific conditions of life. For instance, the use power of a bicycle, qua resource for cycling, in the setting of a raft drifting in the middle of an ocean, is pretty much zero. However, even if the context is felicitous and the product entirely functional, that does not mean that the use power of an object will actually be put to use. The use power of an object is just the potential it ofers its user to undertake some useful activity. The idea is analogous to Marx’s concept of labor power. Labor power is the productive capacity workers have, which they exchange for their wage. Whether or not that capacity is made use of is contingent on various factors, primarily how efective capitalists are in extracting labor from workers during the working day. Use power is the useful activity-generating capacity workers get when they use their wages to acquire wage goods. Whether or not that capacity will be made use of depends on various contextual factors, such as the availability of time, energy, and complementary resources. The final thing that should be noted is that the use power of most objects gets depleted with use over time, because of material wear and tear. Commodity objects have a useful life—a duration of time-in-use before they become worn out and are no longer useful.

Introduction

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Use value: By use value I mean the value ascribed to commodities by virtue of the notional use power, or useful activity-generating potential, with which they are endowed (at times I also use the term in its more traditional Marxian sense). The diference between utility and use value is that utility is actual satisfaction, while use value is attached to the envisioned capacity of a commodity to facilitate useful activities. For a given person, the use value of a commodity depends on assessments about the extent to which its use power can be converted into actual activities, as well as the person’s preferences. The use value of an object can be said to have been realized only through actual use, with the limits of use set by the use power of the object. As with utility, the use value of a commodity is not amenable to precise measurement but rather is a matter of rough judgment, an approximate sense of things. Indeed, precisely because diferent use values are qualitatively distinct, it is unclear on what basis they can be compared quantitatively.

Plan of the Book

The plan of the book follows the abductive structure of its argument. The first part of the book describes the general pattern under advanced capitalism of stagnating work time and relentlessly increasing consumption, and introduces a theory which, I suggest, ofers a good explanation for the pattern. Chapters 2 and 3 explore what is puzzling about the peculiar combination of economic growth, consumption, and work time under advanced capitalism, especially in its American incarnation. In Chapter 2, I discuss the issue on a quite abstract level and consider possible explanations from diferent parts of the social sciences. In Chapter 3, in order to make things more empirically concrete, I analyze patterns of productivity, wages, work time, and consumption in the United States between the later nineteenth and late twentieth centuries. Chapter 4 introduces a diferent kind of explanation for the puzzling pattern I identify, one based on the normativity governing exchange and, specifically, on the problem of commensuration in the exchange of labor for a wage. I set out the advantages of this exchange-based explanation for the pattern of time use, work, and consumption under capitalism over other possible explanations. The first part of the book concludes with a consideration of various objections that could be raised against this wage-labor commensuration theory of mass consumption.

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Time for Things

The second part of the book shows how various trends in US history align with the theory. I focus on two large-scale developments. The first of these, discussed in Chapter 5, is the increasing legitimacy accorded to the institution of wage labor. Wage labor began by being regarded as a deeply questionable institution, entailing coercion and loss of freedom to such an extent that it was associated with slavery but, over time, came to be seen as a potentially fair exchange relationship. This legitimization of wage labor involved the rise of an overriding concern with a conception of fair wages defined in terms of their purchasing power—the capacity of the wage to capture a set of goods, the value of which is deemed in some sense suficient for it to count as fair compensation for the work given in exchange for the wage. The notion of measurable purchasing power in turn depended on the second trend I examine—the increasing standardization of consumer goods (as well as work and wages). Standardization had the efect of stabilizing the properties of consumer commodities, which was a prerequisite for commensuration. At the same time, the moral economy built around the notion of fair and commensurate wage-labor exchange encouraged further standardization in the sphere of consumption. Diferent dimensions of the standardization of consumption are discussed in Chapters 6, 7, and 8. In Chapter 9, I consider the reaction to the perceived violation of the normative order underlying the standardization of consumption, by examining the moral panic around planned obsolescence. The rise of what historian Meg Jacobs (2005) has described as a “purchasing power paradigm” in American political economy, which focused on real wages above all else, in conjunction with the standardization of consumer goods, promoted the notion that work is commensurable with its wage. And it was this commensurability of wage and work, I argue, that explains the pattern of work and consumption that emerged in the twentieth century. The book concludes with a summation of the argument and some general thoughts about the character of economic normativity under capitalism.

Introduction

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