Monday, July 21, 2008

Wealth is not sole indicator of worth

This is my column today.

First, please bear with a little personal story telling. In the last two years I have had the great fortune of working for a company that keeps its head office outside of the Makati Commercial Center. This means being spared the thousand and one aggravations that come with being cooped up along with millions of other working drones within a few square hectares of precious prime property: traffic, congestion, pollution, and the lure of commercial considerations. So in a manner of speaking, I’ve been thankfully insulated from lifestyle and commercial trends.

Except when I have to attend meetings, I rarely find myself in Makati. So I have been blissfully oblivious to the new commercial establishments that have sprouted in the Greenbelt and Glorietta centers like, well, children of Filipinos who have been kept ignorant and without access to contraception methods. (I know I just wrote a really awful metaphor; sorry, couldn’t help it in light of the obstinacy of the Catholic Church to fight the reproductive health bill in Congress through any means possible).

But I finally found myself in the posh environs of Greenbelt 5 over the weekend courtesy of a friend who is into material things of dubious value but whose worth have nevertheless been shot up into the stratosphere by the signature attached to it. It was a painful reality check. Just for the heck of it, I picked up a pair of ladies’ shoes on display and inquired about its price: a whooping P45,000. I was sorely tempted to ask if the pair of shoes had magical qualities that made transformed whoever wore it into Cinderella, had it not been for what I felt was the utter ridiculousness of the whole thing.

If it was any consolation, the saleslady I was chatting up seemed to empathize and intimated that she herself couldn’t understand why such things cost 1,000 percent more than what their counterparts in Divisoria would. The quality is not the same but I doubt if the quality differential was proportionate to the price gap. But there seems to be a huge demand for these accouterments of status even if, as the saleslady pointed out, quite a number would purchase items by maxing out limits on two or three credit cards combined. Why anyone would want to slave themselves paying credit card bills for months for something that can be worn once or twice seems incomprehensible.

There was nothing—absolutely nothing—in the row of stores that we checked that was worth less than P3,000, which, if we come to think about it, is roughly the half-month take-home pay of about 90 percent of the population. I understand that these establishments are meant to cater to a specific clientele. I don’t mean to knock on free enterprise, but I am worried that no one seems to be measuring this emerging conspicuous consumption, reckless luxury spending, and ostentatious display of wealth and materialism against contemporary socio-cultural considerations.

Obviously, there are people in this country who can really afford P80,000 Jimmy Choos or Manolo Blahniks. The question is: Are their numbers increasing? Are we finally seeing the narrowing of the wealth gap in this country? Are we finally seeing the rise of enterprise culture, of value creation that trickles down benefits to the lower rungs of the social ladder? I am afraid not.

Let’s make no bones about this. We are not going through an economic renaissance wherein those who have access to newfound, albeit temporary wealth such as the windfall from the call center industry, are making society wealthier. In short, the seeming rise in personal fortunes, which is illusory to begin with, is not linked to wealth and value creation at all. Nor is it indicative of a real economic boom.

For example, the truth is that the income gap is even more widening as we speak. Just last week, my colleagues and I in the human resource management profession were locking horns trying to find a way to measure the gap between the salary of top executives and the minimum wage earners. We know it is going to be difficult, not to mention, suicidal. But the chasm in the pay gap defies any semblance of logic and fairness. There are many factors that contribute to the gap and I unfortunately don’t have the column space to discuss them today, but obviously, lifestyle considerations are a huge part of it. CEOs and senior executives have to live up to certain expectations in terms of material display of wealth and personal worth—high-rise condos, luxury cars, designer clothes, the whole shebang.

We must address these issues because they portend a number of disastrous social implications.
It was difficult to ignore the tell-tale symptoms of our new collective malady at Greenbelt over the weekend: Far too many people accessorized in iPhones, iPods, and sleek cell phones sipping designer lattes and lounging around in Havaianas. The statement is obviously more of style than substance.

We’re seeing a lot of young and not-so-young people (such as call center agents) who are splurging newfound temporary wealth who have easily latched on to the trend. It does seem that we are nurturing a generation that is not so shy to flaunt wealth—even if its temporary, people who seem to subscribe to the mantra that there is no point to having money if it is not spent on material things.

Unfortunately, we’re really all party to it. Advertising, for example, has driven conspicuous spending to preposterous levels that seemed to have perverted the real value of a lot of material possessions. It does seem that luxury shopping is now prescribed as therapy for everything—if you are happy, go out and buy something, and if you are depressed, well, go out and reward yourself by buying something just the same.

What seems clear is that wealth today is closely intertwined with personal worth (note how we often measure the value of a person, even senators and congressmen, by measuring his net worth), resulting in widespread insecurity and frustration.

How these affect the national psyche is something our sociologists should worry about.
Some of my colleagues have been advocating programs on financial planning and wealth and value creation. We must find new measures of one’s worth other than material status. This is why I must admit that I was a little gladdened by the fall of the so-called Gucci Gang because of intense criticism in the blogosphere about the ostentatious display of profligate lifestyles.

Unfortunately, mainstream media didn’t play it up because it would have offended the very people who produce their profit. But if we all play our part in impressing upon people that we are not impressed by excessive display of wealth, then perhaps we can minimize all these conspicuous luxury spending and too much emphasis on materialism that is not creating value to society at all.


Adam Smith once said: “The chief enjoyment of the riches consists in the parade of riches.” I think that’s a capitalist statement that we need to render irrelevant in this country at this point.

3 comments:

vic said...

There are such people and there are others...I also have some nice stories to tell about how the rich and famous among us spend their “wealth”.

First there was the Media Tycoon Conrad Black who did not care chartering a jet plane to Bora Bora for his wife Birthday celebration, the problem was, it was revealed in his fraud trial, not his own money (he was convicted and serving 6 years sentence in U.S.)..The other time he showed his customized Bently or Aston Martin to another man perhaps much wealthier than him, Peter Munk of Barrick Gold Mine and Mr. Munk asked him “how could you afford it?” I can’t..the fact was Mr. Munk had just handed a $50 millions donation to the University Hospital of his own Money ( in addition to the already standing heart and Lung Centre, named for his family) for it’s Heart and Lung Centre, saying his dad and grandad spent their final days at the hospital and he wants every one in the province to get the best care as possible...And to the couple Labbatts who instead of buying a yacht, gave $38 millions to the Hospital for Sick Children and pointed to the press, “that is my yacht” .. There are many of them who are giving back to the society who had been good to them...and there are also many who will splurge on a $1000 pair of shoes...

Pluck will sure do fine, the kids like it here and the eldest is now in her second year in college and the younger one is in elementary in Catholic School, also publicly funded inclusive of busing. Moving day is August 17 and the location just perfect...accessible to the Public transport, Mrs. Pluck doesn’t know how to drive, pluck is driving a beautiful Honda Odyssey Mini Van..and he said he so busy with his new life can’t even spare some time to look at on-line news, but I suspect he can’t stomach the shenanigans going on which he said he was not able to fully appreciate and took them for granted before...now he too has some basis for comparison...he is very intelligent and a good fellow.

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Twin-Skies said...

Reading your post reminded me of an old Confucius teaching:

"In a country well governed poverty is something to be ashamed of. In a country badly governed wealth is something to be ashamed of."

While I have nothing against the rich (provided they earned their money legitimately), it does piss me off when they decided to parade around in some needless luxury when the money could have been spent more wisely.

Those Porsches we see parading around are a good example: The owners are just ASKING for their wheels to either get stolen, or bebroken up by our badly paved "roads."

Don't even get me started on their cell phone usage - I've met my share of the wealthy who carry an iPhone as a fashion statement...but have almost no idea on how to use the damn thing outside making phone calls or texting.

Meh - what an insult to the device's craftsmanship.

In my case, I don't spare expenses when it comes to boots, but I do invest in a pair that will last, and is at least waterproofed.

If you're going to spend big, at least be practical about it.

And if you're gonna get an iPhone, at least read the freaking manual.