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                         CONSUMER AFFAIRS VICTORIA


                                  15-17 MARCH 2006

                          Q&A HAMILTON/NORTON/BROWNE

Jan Pemplin, I’m a financial counsellor at Eastern Access Community Health, so I work on an
individual basis with low income and vulnerable consumers, as Victorians representative on
the National Financial Counsellors Association I work on broader policy issues. My question
is about the affect on those consumers. I guess what I see from my case work, my individual
contact with low income people is that there is now I see the affect, I guess, of what people
have determining who they are, and that is an affect of Affluenza I think. And I certainly see,
in the work that I do, the connection between self-worth, self-esteem and what people have. I
guess that some of the research we’ve seen recently, some good research that’s come, for
instance from the ANZ Bank looking at people who are feeling out of control with their
finances, comments on one of the major outcomes of that research was that there were
unhealthy thinking among those consumers. But my view is that that unhealthy thinking is
very much driven by the marketing of consumerism in our society and that in fact the impact
on low income consumers who are either alienated from society because they can’t be part of
it, who are then, if they do access consumerism and credit, let’s say, can be victimised.
Whereas in fact, what leads to unhealthy thinking among people whose finances may be out of
control, my view is that it is the marketing of a consumer society and the marketing of credit,
and I’m just wondering if we could have some comments about low income people in relation
to the topic.

I’d just like to make a couple of comments on that. There was an ad run a couple of years ago
on TV which had a 12-year-old boy going up to his father saying, “Dad, I want a new bike”,
and the father says, “Sorry, son I just can’t afford it.”. And the son says, “Ah, but if you go to
this credit agency they’ll lend you the money so you can buy me a new bike.”. Talk about
exploitation of the emotional needs of low income people, I think that’s a shameful
advertisement that actually should be banned. I don’t think that’s illiberal at all to stop some
powerful people exploiting others. You use this wonderful phrase, vulnerable consumers,
aren’t we all? I’m a vulnerable consumer. Several years ago I bought a Toyota Camry and
when I bought it I was thinking I’m not going to fall for the various images associated with a
particular car, so I’ll take a fairly bland vehicle. Then a couple of months ago I heard an
advertising exec being interviewed on radio and he was commenting on something or other and
he said, “Take for example the Toyota Camry, now they’re marketed to people who want to
present an understated sort of image.”. They got me. But finally, I just want to respond very
briefly to a couple of Andrew’s observations. I simply reject the view that what we’re
advocating in the book is a paternalistic interference in people’s consumption decisions,
because as I said, and I didn’t elaborate, I don’t think it’s a question of leaving it to the
consumer to work it out, because it’s an unfair battle. There’s a vast extremely clever,
extremely well resourced advertising industry out there. They employ all the best
psychologists to know what our weaknesses are so that they can exploit them in a way that we

don’t understand. These are very clever people who make a lot of money out of it. Just two
things I would advocate as government policy, without any hesitation. One is all ads to
children under 12 should simply be banned. Children under 12 are incapable of making a
judgement, they are not the rational beings of the economic texts, none of us are, but they
especially aren’t. Just as in Sweden advertising to children under 12 is banned. Secondly, the
advertisers have a code of conduct, a voluntary one, which outlaws deceptive and misleading
conduct. Now I would like to see that legislated so that deceptive and misleading advertising
were illegal, and of course there’s a lot of interpretation of that, but certainly that Coco Pops ad
is unquestionably deceptive and misleading for children and parents, so I don’t have any
hesitation in extending bans on advertising that we already have for certain damaging
activities, such as smoking.

Just a comment on the question. I think there are two approaches to this, one is the Clive
Hamilton approach which is to ban the original cause of this, which is the marketing, the other
is probably what I would call the social democratic approach which Clive critiques in the
quarterly essay which was released late last week, which is essentially to redistribute income so
that people who are now poor can participate more fully in a materialistic society. So there are
two ways of going about it. I think the second is probably the more practical of the two, but
nevertheless there are two ways which are within the broad, perhaps if not anti-market, at least
non-market political perspective.

My name is Geoff Soo from the Cold Group and I was Co-author of the Consuming Planet
Earth book that Geoff mentioned. First I’d like to commend Consumer Affairs for producing
that book, it’s just a great step for them to take and I was just wondering if I could hear both
from Clive and Andrew, I know in this talk you hadn’t spoken much about the environmental
impact of Affluenza, and if you could address that a bit, and also to Andrew, you critiqued
some of Clive’s comments on the personal wellbeing and personal choice around personal
wellbeing and I’m wondering if you could also comment on - do you view regulation in a
different way when it comes to environmental impact from the point of the environment being
a public good. So does a government have a role in * if it is shown to have a direct impact on
environmental degradation.

That’s a huge subject, let me just make one comment that I was going to mention in the speech,
but I cut it back, and that’s just to refer to the work that we did on this phenomenon that we’ve
dubbed wasteful consumption. We all know that we buy too much stuff we don’t get the full
use out of and then throw out. But we identified this even worse phenomenon, and that is the
amount of money we spend on stuff that we just never use. CDs we don’t listen to, food we
throw out, cars we hardly ever drive, all sorts of things, clothes, cosmetics, shoes, I mean
we’ve all got them. Ties, how many blokes here have 20 ties they never wear. We did a
survey and estimated at an absolute minimum Australians spend $10.8 billion each year buying
stuff they don’t use, at all, they just keep it for a while and then throw it out, for a very short
period in the case of food. When we asked people why they undertake this activity we found
some very interesting things. I mean some people just do it because I can, who cares. Some
people say well I thought I would use it but I didn’t and I feel really guilty about it, but what
the hell anyway. So I think this is really, in a way, the most disturbing aspect of Affluenza, the

fact that … consuming something, they’re really quite distinct acts and often there’s a
separation. You buy something, but you don’t consume it and perhaps you don’t really intend
to consume it, you just want to buy it. We talked about Owniomania in our book, which is
compulsive shopping, which is a condition that affects perhaps 5% of people who simply
cannot help themselves but buy stuff and they come home with bags full of stuff that just go
into the cupboard and it usually reaches a crisis point when the credit card is maxed out and
suddenly the partner discovers that you’ve got wardrobes full of stuff that you couldn’t ever
use. I suggest in the book that that is a clinical condition according to the psychiatrists, in a
way it’s the characteristic disease, if you like, of modern consumer society.

I’m not an expert on the environment but I suppose my general world view is that whee there is
an environmental consequence of consumption that the price of that should be built into the
prices of the goods so that people factor that in to their decision-making rather than necessarily
banning the good as the first step.

My name is Janet from Western Australia and I also work with low income clients about
financial matters and some of the comments that were made between the speakers resonated
with me where Clive had that ad about the Porsche or the baby and I think I had seen that as
well and was a bit surprised. And then when Andrew was pointing out perhaps the government
- we’d start to worry if the government was involved in saying whether we had a baby or not,
so it’s really not a problem and it reminded me of clients that I see, quite young mums who the
government now issues that $3,000 bonus, which I believe they’re going to increase the baby
bonus and what used to happen is we’d see them as single parents, or maybe two or three
months pregnant and we’d see these people who were kind of bereft and now their partner
stays with them until they have the baby, which I think relationship-wise is a very good thing.
Unfortunately three weeks after, when they get the $3,000 baby bonus the type of clients I see,
often he’ll buy the car and go and then we see the women for financial assistance. That’s a
very small percentage of what we’re talking about today, but in terms of young people and
consumerism and the choices that people make and what it means for relationships I think has
been well made here today and I’d just like to say that the connections between your speeches
resonate. Thank you. You can comment if you will.

Perhaps at this point in time I’d like to confess that I am a psychologist that does study the
understanding of the mind and what leads to overspending, underspending, being happy,
unhappy and one of the things that I’ve been very much looking at is that one of the greatest
things that makes for happiness, and certainly shown by the research is caring for others, which
cuts across all things, and I guess just as a little aside I would like to confess that I have a
BMW that’s now nine years old and for the last three years, each year at about this time I start
to have the dream that I would like to have a new one. So I ring up and go into BMW and test
drive the car, and I now have it quite perfected. I drive out with the dream, I imagine what it’s
going to feel like, this is my car, yes, mine’s really a little bit rattly and I drive out with this
fantastic dream and at the turning point when the salesman goes to close the sale I then revert
to my how much money I’m going to save by not getting the car and it’s fantastic. I drive back
with this elated feeling of how good my car is and how much I’m going to save.

Just one final thing I’d like to say, when I set out to make comedy training films many years
ago I was really amused by my first writer, known to many of you, John Clark, the satirist, who
told me that when he got one of his promotions in New Zealand, he appealed against his
promotion because he thought that would help in his life.