“You are now sitting on a whale’s foreskin”. How’s that for openers? This was how Aristotle Onassis startled new guests to his yacht. The barstools on the Christina were indeed covered with the buttery-soft and outrageously expensive foreskins of baby sperm whales.

In addition, the vessel’s taps were made of solid gold and the swimming pool drained, at the flick of a switch to reveal a mosaic-tiled dance floor. These essentials were just some of the artillery in Onassis’s battle to outdo his rival Greek shipping magnate, Stavros Niachos, whose own yacht, the Atlantis, was designed by an architect with specific instructions to make it 50 metres longer than the Christina.

It’s not only shipping magnates who indulge in the battle of the brands. When I was working in the investment banking game, each January at bonus time my colleagues bought themselves new toys. A favourite in the mid-1990s was the Tag Heuer watch, which validated its outlandish price by, among other crucial features, the ability to tell the time at 800 feet below sea level. Quite astoundingly, some salesman had convinced these overweight landlubbers from Essex that a watch which could tell the time below sea level was a must and said something about the type of people they were.

Brand obsession (and the need to acquire brands to differentiate us from the rest of the ‘yellowpackers’) is one of the most significant recent developments in western societies. It is not limited to one group in society. Historically, teenagers have been brand-obsessed, but the businessman who buys the latest top-of-the-range Merc, the couple who secure a table in Dublin’s trendiest restaurant and the Prada handbag brigade are all playing the same game.

The game is about distinguishing oneself in relative, not absolute, terms. If everyone has a Prada handbag the allure diminishes. It quickly becomes what it is: a piece of nylon with a handle in which to put one’s lippy. Likewise, if every teenager had the latest kit, there would be no point in anyone having it in the first place. Ironically, it seems that one’s individualism is only defined by what others cannot buy, and by implication, our needs are determined by what other people buy. So when a rich man buys a top-of-the-range Merc, his choice determines what other people buy.

This crucial aspiration link is missed by proponents of the absolute free market, who believe that the economy is full of people who behave rationally in isolation of each other. The truth is that everything we consume is determined by what our neighbour buys. In fact, the consumer economy works more like Midnight at the Olympia than an economic textbook. The Olympia model of the economy works as follows: before the gig, everyone gets a pint and sits down in a relatively orderly fashion with a decent view of the stage. As soon as the band comes on, those at the front stand up. Those behind can’t see, so they stand up. Soon everyone is standing. A little later, girlfriends are on shoulders and the entire place is swaying precariously, full of shortsighted drunken triffids. If everyone had stayed sitting down they’d all have a better view.

When someone buys a flash car it sets off the same reaction in an economy, and eventually the roads are clogged with flash but fairly stationary motors. Likewise, when someone decides that he needs five loos in their house, it sets off a chain reaction of bigger houses with under-utilised faux marble loos.

For the economy in general, the obsession with brands and the consumer pecking order has three serious consequences.

First, as the whole point of the brand is to extract more profit for a run-of-the-mill product, branded goods are more expensive. This erodes the purchasing power of workers’ pay and reduces net disposable income. Take the example of a normal worker whose teenage kids want the latest branded clobber. The parents’ disposable income will be reduced dramatically as a result of the kid’s obsession with the ‘right’ runners. As a person’s pay packet is eroded, he feels less satisfied with his lot, and, naturally, looks for offsetting wage increases.

Second, if these wage increases are not forthcoming, people dip into their savings or borrow more to keep up with the aspirational standards which are set by the consumer society. In Ireland, we have clear evidence of this development. Our savings rate has dropped sharply, from 11 per cent of GDP at the beginning of the 1990s to 6 per cent today. Simultaneously, our consumer borrowing and indebtedness have soared. Not only have we run down our savings, at the same time we have increased our levels of indebtedness.

Third, faced with such a debt burden, people are now working much longer and harder to keep the whole show on the road. Taken together with the longer commute, these longer hours reduce immeasurably that elusive concept called quality of life.

In an effort to recapture a stylised (and sometimes entirely fabricated, in the main by advertising executives) concept of the quality of life, workers naturally strike for higher wages. The latitude for wage increases, whether from employers or government, is determined by concepts such as productivity, inflation and overall budgetary considerations. In contrast, the yearning for a better quality of life, which might be attained by more income, is driven by the relentless pursuit of branded items that apparently make us different from everyone else. Unfortunately, there is no link between national productivity rates and the price of a Fendi handbag.

In short, the value of money, or income, is falling, and the price and value of brands is rising, leading to huge dissatisfaction on the part of workers and an inability of traditional economic yardsticks such as GDP or income per head to capture this frustration.

Our elected politicians are behind the times. There is absolutely nothing they can do in the face of a global culture of brand obsession. Yet we hear elected officials harping on about social partnership and citing meaningless macroeconomic fundamentals which signify absolutely nothing for most people.

This decoupling of a person’s aspirations from the ability of politicians to deliver will accelerate the irrelevance of party politics in the western world. Is it any wonder that in the US, the home of the brand obsession, less than 50 per cent of the electorate vote in the presidential election?

It seems now only a matter of time before our falling turnouts reach US proportions and party politics ceases to have any meaningful impact on anyone’s life.

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