What’s Beyond Those Bargains?

Devin Leonard, The New York Times 4 Jul 09;

MOST people I know love Ikea. Many of us have bought furniture from Ikea stores, and even if it falls apart we keep going back. Say what you will about Ikea, its stuff is always stylish. And so inexpensive!

But in “Cheap: The High Cost of Discount Culture” (Penguin), Ellen Ruppel Shell argues that Ikea has engaged in many questionable business practices to maintain its low prices. She says it buys much of its wood in Eastern Europe and far eastern Russia, “where wages are low, large wooded regions remote, and according to the World Bank, half of all logging is illegal.” The author writes that such deforesting contributes to global warming, threatening the planet. That is a steep price to pay for cheap bookshelves, she says.

This is an inflammatory accusation. But “Cheap” is a jeremiad. Ms. Ruppel Shell, a contributing editor for The Atlantic Monthly and a journalism professor at Boston University, is disgusted with retailers who she says have abandoned their principles in pursuit of rock-bottom prices. And she is angry with the rest of us for supporting them.

Ms. Ruppel Shell argues that our national obsession with bargains has lowered our standard of living and hurt the environment and the quality of American products.

“Cheap” has plenty of targets, and many are usual ones. Ms. Ruppel Shell lambastes Wal-Mart, saying it underpays its workers and enables other retailers to do the same. She criticizes China as tolerating sweatshops with dangerous working conditions. And if you have a weak stomach, you may not get past the chapter entitled “Cheap Eats.” The author goes into wrenching detail about the foul and environmentally noxious conditions at some of the world’s largest factory farms, suppliers to the fast-food industry.

She castigates Red Lobster, saying it patronizes Thailand’s shrimp farms. The Thai shrimp industry has been accused of environmental, child labor and human rights abuses; it attracts migrant workers from Vietnam and Cambodia who labor for next to nothing, Ms. Ruppel Smith writes.

She also writes that Thai shrimp farmers have clear-cut the country’s coastal mangrove forests — a protective wall between land and sea — to make way for more breeding grounds. She cites a United Nations report that says their disappearance exacerbated the effects of the Southern Asian tsunami in 2004 that killed more than 5,300 people in Thailand alone. In other words, many have paid a terrible price so Americans can feast on cheap crustaceans.

(In an interview, a Red Lobster spokesman said the company monitors its Thai suppliers and doesn’t buy shrimp from the ones engaged in the kind of practices that “Cheap” highlights.)

But most of all, Ms. Ruppel Shell indicts all of us for supporting these discounters — particularly those of us who consider ourselves politically and socially aware.

“We rail against exploitation of low-paid workers in Asia” but still drive long distances to save a little money on tube socks, she writes. “We fume over the mistreatment of animals by agribusiness but freak out at an uptick in food prices. We lecture our kids on social responsibility and then buy them toys assembled by destitute child workers on some far-flung foreign shore.”

“Cheap” isn’t perfect. Ms. Ruppel Shell makes some glaring errors. She refers to the convicted fraudster Bernard Madoff as “Michael Madoff” (who she says has contributed to consumer cynicism) and at one point refers to the former Wal-Mart C.E.O. Lee Scott as “Lee Jones.”

She is a bit too eager to spread blame. The author chronicles her visit to Ikea headquarters with way too much snark. She is unimpressed when Ikea’s chief, Anders Dahlvig, describes the steps his company is taking — among them employing 11 monitors led by a woman whom the author herself describes as “deeply knowledgeable” — to avoid doing business with illegal foresters. She still doesn’t think that Ikea is doing enough; then again, she doesn’t offer any original reporting that suggests the company is doing anything wrong.

And she is too quick to paint the men she describes as the founders of today’s discount culture as black-hearted. She infers that Sylvan Goldman, owner of the Humpty Dumpty supermarket company, introduced the shopping cart in 1937 to fool his consumers into buying more goods. But how many of us can stand in the checkout line with a week’s worth of groceries in our arms? Mr. Goldman deserves gratitude, not scorn, for his consumer-friendly innovation.

Still, it’s hard to argue with Ms. Ruppel Shell’s overriding thesis and her grudging conclusion that it won’t be easy to reverse the ravages of discount culture against which she rails.

She concedes that America can’t seal off its borders to keep out low-cost Thai shrimp and Swedish bookshelves. “Tariffs to keep out foreign-made goods may offer a short-term fix,” she writes, “but over the long term United States would be poorer and weaker were we to snub international markets.”

In the end, she calls for a consumer revolution. She says that we must spend in a way that is consistent with our principles.

That won’t be easy in a recession. Before he retired last year, Mr. Scott predicted that his company would thrive during a downturn. “In my mind there is no doubt that this is Wal-Mart time,” he told a group of analysts.

But what if the crisis does cause people to rethink their spending habits? They might if they read “Cheap.” Maybe Ms. Ruppel Shell’s disgust will be contagious.