In Cheap We Trust

As part of my ongoing effort to read every book about frugality and simplicity in the English language, I recently finished Lauren Weber’s In Cheap We Trust: The Story of a Misunderstood American Virtue. This is definitely on the intellectual side of the spectrum, and well worth it for anyone who wants a comprehensive of American frugality (history of, attitudes toward) as well as an overview of the ongoing arguments on the subject.

The book starts out as a history of American attitudes toward thrift, which has the strongest of pedigrees, starting as it does with Ben Franklin, founding tightwad. Franklin's attitude, of course, was that frugality is the way to wealth, and strains of this come through American history, through to Dave Ramsey today who basically says the same thing. Other historical highlights include the 19^th century “world’s greatest miser,” Hattie Green, who supposedly allowed her son’s leg to be amputated rather than take anywhere but the free medical clinic, and the “School Savings Bank” movement of the early 20^th century.

Weber also traces the transition a consumption-based economy and the resultant overturning of thrift as an American value, as in this quote from the self-help book Mrs. Consumer (1929):

There isn't the slightest reason in the world...why, for instance, bread crusts and left-over portions of breadloaves should be on the conscience of Mrs. Consider because she doesn't make a bread pudding or French toast out of them as foreign housewives do. Or hash out of yesterdays roast beef. Or dust cloths out of old undergarments,; or pantaloons for son out of father's cast off suits – and so on ad infinitum.”

Which, Weber points out, was “a 180-degree reversal from the official dogmas that had dominated advice to women a hundred years earlier.” And that is basically the tension that has been evidenced in American life since then – the tension between the Franklin “savings leads to wealth” and the “don’t worry be happy” invitations of businesses and the consumer press.

The final few chapters are more think pieces about various issues that are raised by a frugal attitude, such as John Maynard Keynes’ famous “paradox of thrift.” Short version: Keynes famously said that personal savings, while admirable on an individual level, were actually counter to recovery from the Depression, because economic growth depended on consumer spending. Weber points out that money for investing has to come from somewhere, and usually historically it came from personal savings; recently it’s come more from borrowing – on the individual level from loose credit, and on the governmental level from foreign countries, in either case an unsustainable model in the long run.

She also devotes a chapter to the question of whether frugality is some kind of mental illness, an anal retentiveness or guilt that evidences an inability to enjoy life. She points out that some research shows that frugal people may actually be more mentally healthy than their spendthrift peers, showing better self-control in other areas as well.

A topic of particular interest to this blog is chapter 4, “Cheap Jews and Thrifty Chinese,” which traces the stereotype of hyper-frugality that has followed these two populations in America. Jews, of course, also had the stereotype of the avaricious banker to contend with, which was supported by Henry Ford in his newspaper The Dearborn Independent in the 1920s, as well as the clueless-social climber stereotype which was evidenced (although Weber doesn’t mention it) in the Great Gatsby. Weber:

The character of the obsequious and avaricious Jew, like all stereotypes, was woefully exaggerated and largely untrue. It required the gross flattening out of reality – a reality in which many Jews struggled, worded hard to gain a modest hold on success, and generally lived unassuming, respectable lives.

Every synagogue in the Midwest has a dozen people in it whose grandparents were in retail in some small town and were likely the only Jews in that town. So that was how the townspeople experienced Jews, but by and large these were honest, hardworking people trying to make their way in America, which they did fabulously successfully, as evidenced by the doctors and lawyers their children have become.

All in all I recommend this book, for its historical overview, for its intellectual depth, and for taking seriously the urge not to splurge. One final quote:

Just as Americans imagined until recently that we inhabited a world of unlimited credit, so we have also been enjoying a sense of entitlement and false confidence about the natural resources that support and sustain us. The United Nations recognized this a while back; its 1992 report “Agenda 21” cautioned that “the major cause of the continued deterioration of the global environment is the unsustainable pattern of consumption and production, particularly in industrialized countries.” That’s why cheapness – buying less, blocking out the message that spending equals happiness or patriotism – can help us solve not just the economic insecurity of our time, but the environmental insecurity as well.

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