Sociological Perspective of the Consumer Expenditure Survey
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BRANDMAN UNIVERITY SOCU 101
Sociological Perspective
of the Consumer
Expenditure Survey
Americans Can't Afford to be Average
Jerry Pattison
11/18/2012
Assignment: Select a specific current event from the news, e.g. from television, radio, a newspaper, the internet that
you can easily describe and analyze. describe this current event in one paragraph and identify how you will analyze
and research it from a sociological perspective in a second paragraph; se at least 5 different concepts, theories, or
principles identified in our textbook during Weeks 1 – 4 by naming each one, then discuss each one separately to
specifically analyze the current event. You may find it help to use one of the major sociological perspectives, i.e.
functionalism, social conflict, or symbolic interaction. In this assignment you are expected to demonstrate that you
can utilize a sociological perspective to analyze and better understand a current event. Also, it is very important to
review the grading rubric that will be used to evaluate and grade this paper.
Sociological Perspective of the Consumer Expenditure Survey
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Americans Can't Afford to be Average
The "bad" economy has become a staple of news networks, hardly a way goes by when
there isn't a new article or blurb on the nighttime news bemoaning the failing economy and the
consequential loss of jobs for millions of Americans, or the cuts to various budgets. As the
problems increase for Wall Street, big business and the government they trickle down to the
common American with devastating consequences. As the monetary standard has inflated many
people have become dependant on the system for their elderly care - mainly through medicare
and social security, neither of which seems to have a bright and financially secure future. The
consequence of this is that most Americans will have to rely on themselves and their families for
financial support in old age.
More to the point, the average American will have to more than save for a rainy day, he
or she will have to plan on amassing a sum large enough to support themselves through decades
of declining health. This is especially difficult in an economic climate that has created large
expenditures without equally inflating income. According to an article in Forbes the average
annual income is $63,685 and the average annual expense is $49,705 - which leaves $13,980 per
year on average for a typical American to live on (Laura, 2012). When taxes are taken into
account the authors notes that "average American, given government income and spending
patterns, has a whopping $1,243 per year on which to get ahead" and characterizes a persons
financial dreams to be like an "impenetrable fog" given the figures and leaves the reader with the
warning: "you can no longer afford to be average!"
The Sociological Perspective on Consumer Expenditure Report
This paper will analyze the report based on the Structural Functional perspective as well
as the Symbolic Interactions perspective. It will also explore the Social Stratification in America
and how Conspicuous Consumption is driven in part by modernization which all, in turn has
resulted in a decline of the middle class and left the average American without the required
financial backing to ensure a stable retirement.
According to a paper on the Structural-Functional approach by Devi Prasad Subedior the
approach is "a broad perspective in sociology and anthropology which interprets society as
structure with interrelated parts. The various parts of society - from the government and its
many arms, to entrepreneurs, large corporations, the middle man and finally towards the average
working American. Each part of society works together as a whole to support the other parts.
Companies do not exist without customers, and customers do not get their products without the
company to provide them. At a base level society is a function of its parts. In modern society on
of the most basic parts is the family unit - which revolves around the immediate biological
family (mothers, fathers, brothers and sisters) and extends outward towards grand parents, in
laws. People in this system interact with each other through roles. Children expect to be taken
care of, which parents are expected to take care of their wards. Monetary security is an
Sociological Perspective of the Consumer Expenditure Survey
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increasingly large part of this - since the majority of Americans use a standard currency for
transactions now that the barter system is in the past. With a downward spiraling economy, more
expensive life (and a longer life to expect), fewer opportunities for upward social mobility, more
stagnate income levels and an increasing median personal debt Americans need to reconsider the
'traditional' plan for retirement.
Social Stratification and the Modern Class System
Although much of the American Dream is based on the idea that anyone can be
successful, statistics show that monetary success may be on the decline. According to data from
the new York Times 27% of the population moved up or down two or more quintiles during the
1970's (The New York Times). The 1980's showed a 24% mobility rate and the 1990's slowed
more, dropping to 21%. This shows that mobility between economic classes was on the decline
over those three decades. America is typically split into three sections of social class - high
wealth, middle class and poverty class. The middle class worker typically earns an income
between $ 32,563 and $48,979 per year, an opinion survey done in 2000 echos those figures with 49% of respondents with similar incomes classifying themselves in the middle class (Social
Class in America PBS).
Unfortunately this distinction has grown less rigid as the first decade of the 21st century
came and went. According to a report by the Washington Post, Federal Reserve data shows that
the economic recession has resulted in a 39% drop in the median net worth of an American
household(Mui, 2012). The same article continues to describe the federal data as " ...one of the
most detailed looks at how the economic downturn altered the landscape of family finance. Over
a span of three years, Americans watched progress that took almost a generation to accumulate
evaporate. The promise of retirement built on the inevitable rise of the stock market proved
illusory for most. Homeownership, once heralded as a pathway to wealth, became an
albatross."(Mui, 2012). As the wealth in America has dropped the average debt continued to
grow as many found themselves upside down on home and car loans. As the debt rose median
income did not, leaving many with increasingly tight budgets. This has caused the middle class
to slip towards the bottom of the pole, gaining more debt without gaining income the majority of
Americans are in the process of social mobility downwards. Due to the lack of discretionary
income planning for retirement becomes a hallow dream.
Conspicuous Consumption
Is defined as "buying and displaying products that make a statement about ones social
class and position" (Macionis 2004). This activity has become rampant in modern America specifically in generation Y - where fashion is dominated by the logo of company X or Y. This
phenomenon is well noted even among those of the generation itself. One college student and
blog writer notes that " here at the University of Connecticut the fashion among students is to
Sociological Perspective of the Consumer Expenditure Survey
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wear jackets and pullovers (preferably black) by Northface and, for women, boots made by
Ugg." (Wright 2008). Other examples of this in modern culture is the rise of the iPhone - which
was a symbol of being "cool" and wealthy enough to afford the phone and data plan. The design
became a symbol of college students who were "in". A more enduring example is Ivy League
colleges, whose graduates are elevated to a higher social status because of where they attended
post-secondary education. In a world of decreasing income, but increased desire for high prices
social status items the middle class is being bled dry.
Surprisingly, Conspicuous Consumption can be often be tied to racial stereotypes. For
example a study by economists from the University of Chicago found that " African Americans
not only had less wealth than whites with similar incomes, they also had significantly more of
their assets tied up in cars." (Postrel 2008). The article expanded on the topic, stating that "An
African American family with the same income, family size, and other demographics as a white
family will spend about 25 percent more of its income on jewelry, cars, personal care, and
apparel". Although much of this could be attributed to taste and social norms, the question of
causation lingers. What causes the norm, what mechanics of society drive the economic
differences between African Americans and their Caucasian counterparts - which are, by all
accounts, biologically, mentally and morally equal. It was proposed that this discrepancy in
purchasing habits between two otherwise homogenous groups (who had the same income, just a
different skin color) may be due to a social pressure for African Americans to prove their wealth,
since the majority were not wealthy on the whole. This scarcity caused those who did have
money to flaunt it more readily.
This same concept occurs outside of racial norms, the entire middle class has become
infected with the idea. The housing bubble after the turn of the century was due to large, almost
decedent homes being owned by people with no financial ability to maintain them when money
became tight. Yet there was a palpable desire to buy the biggest home in the nicest
neighborhood, preferably with the newest vehicle possible. This has been increased as money
became tighter, many people purchased consumer products at a high price as a status symbol, to
prove that they were financially stable even in a tough economy.
The Downside of Modernization
Technology has revolutionized the world and its societies. It has created entirely new
sections of industry, inquiry and education. It has also created a new category of expenditure,
one that if often rooted in conspicuous consumption and the use of status symbols. This has
become especially heinous as income levels have stagnated and fallen, yet cell phone bills for
overages and data plans have continued to increase in price. Additionally cable bills have
increased and popular alternatives like Hulu and Netflix are often used to supplement an already
existing collection of entertainment choices. additional accessories like a Roku box, Xbox 360 or
Playstation are needed to get the most out of the connection and large LED television set. These
Sociological Perspective of the Consumer Expenditure Survey
products and services are hugely popular with the tech savvy generation, which is also mostly
middle class citizens - already struggling with expenses for food, vehicle maintenance and
continually higher housing expenses.
Conclusion
The economy has a toll on the many parts of society. Corporations, consumers and the
government do not operate in a bubble. As each changes in response to economic conditions the
changes cascade into other aspects of society. Consumption of status symbols has placed the
middle class in a precarious position economically. The average citizen is surrounded by
expenses - many so large that it results in high amounts of debt. These expenses have continued
to rise and have placed the middle class in a position that has become perilous in light of
Americas economic decline. As debt has risen income levels have not. This is leading to the
decline of the middle class and can eventually result in a less diverse social stratification of
America, leaving only two classes. As the financial ability of individual families has hit
maximum money for retirement has become more and more scarce. The average person cannot
afford to place large amounts of money into savings, yet the average American will be unable to
support themselves without a healthy savings. It has become impossible to be financially
successful in this economic climate. Thus those who desire a comfortable retirement are unable
to spend, earn and save as their peers do.
References
Consumer Expenditures--2011. (2012, September 25). U.S. Bureau of Labor Statistics.
Retrieved November 18, 2012, from http://www.bls.gov/news.release/cesan.nr0.htm
Felson / University of Illinois at Urbana (1975). A Modern Sociological Approach to the
Stratification of Material Life Styles. Advances in Consumer Research, 02, 33-38.
Laura , R. (2012, November 8). You Can't Afford To Be Average - Forbes. Forbes.
Retrieved November 8, 2012, from
http://www.forbes.com/sites/robertlaura/2012/11/08/you-cant-afford-to-be-average/
Macionis, J. J. (2004). Society: The basics (11th ed.). Upper Saddle River, N.J: Prentice Hall.
Mui, Y. Q. (2012, June 11). Americans saw wealth plummet 40 percent from 2007 to 2010, Federal
Reserve says. Washington Post [Washington, DC]. Retrieved from
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http://www.washingtonpost.com/business/economy/fed-americans-wealth-dropped-40percent/2012/06/11/gJQAlIsCVV_story.html.
Postrel, V. (2008, July). Inconspicuous Consumption. The Atlantic. Retrieved November 17, 2012, from
http://www.theatlantic.com/magazine/archive/2008/07/inconspicuous-consumption/306845/
Social Class in America. (n.d.). PBS: Public Broadcasting Service. Retrieved November 18, 2012, from
http://www.pbs.org/peoplelikeus/resources/stats.html
Subedi, D. P. (2010, July 11). STRUCTURAL FUNCTIONAL PERSPECTIVE IN
SOCIOLOGY [Web log post]. Retrieved from
http://subedi.orgfree.com/docs/Structural_Functionalism.pdf
The New York Times (n.d.). Graphic: How Class Works. The New York Times.
Retrieved November 17, 2012, from
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html
Williams CSUN, H. (n.d.). SYMBOLIC INTERACTIONISM THEORY [Web log post].
Retrieved from
http://hhd.csun.edu/hillwilliams/Symbolic%20Interactionism%20Lecture.htm
Wright, B. (2008, September 20). Everyday Sociology Blog: Conspicuous consumption and your iPhone
[Web log post]. Retrieved from http://www.everydaysociologyblog.com/2008/09/conspicuouscon.html