Some of the angriest emails I’ve ever gotten from readers were over a story about credit card points.
The long and short of it is that the fancier the credit card rewards, the higher the swipe fees for merchants. Those merchants often pass along the costs of those swipe fees to all customers, whatever the payment mechanism. People who pay with rewards cards tend to be more well-off, financially, and their hotel points or flight miles are being, in part, subsidized by people paying in cash or debit who tend to be poorer. A 2010 paper found that households that use cash pay about $149 on average to households that use credit cards, and each of the credit card households gets $1,133 from cash users every year.
Essentially, credit card rewards have to come from somewhere, and they’re partly coming from people who aren’t reaping the benefits. Some readers were very angry to discover this information. “Maybe it’s time for people who don’t want to work to know how it feels to foot the bill for other people?” one person wrote to me, apparently equating having a rewards card with having a job. “If people want a better life I suggest education and getting a degree or a certificate in a trade,” wrote another person. “Boohoohoo. Who cares?” wrote another.
Some people seemed to feel that they had a serious right to accumulate credit card rewards, regardless of who or what those rewards were coming from. It’s a sentiment that bears out in the data: A 2019 LendingTree survey found that people were likelier to support a rate cap on credit cards if it reduced access for people with imperfect credit than they were if it meant it would significantly lower their rewards.
“What that essentially says is that more people [were] okay with fewer folks having access to credit than they were with having their own credit card rewards shrink,” explained Matt Schulz, chief credit analyst at LendingTree, in an email.
That consumers can be selfish isn’t a new phenomenon. Remember when everyone was hoarding toilet paper and masks at the start of the pandemic? But it is worth pausing and reflecting on how angry people feel when confronted with the idea.
“In our culture, we have excessively high expectations,” said Robin Kowalski, a psychology professor at Clemson University who studies complaining. Not just high expectations, but specific ones, about how the economy should run and what we should get out of it. We want things to be cheap, we want things to be fast, we want things to be efficient. For decades, American customers have been told they’re always right. Naturally, they’ve come to believe it.
People aren’t accustomed to having to really think about the trade-offs they make for the economy to run how it does, and when they do have to think about it, they don’t like it. Consumer-centric culture has made it easier for us to be destructive in ways big and small — to workers, to the environment, and to each other. Corporations have manufactured our high expectations, and it’s hard to reverse course.
“We expect everything to work just like clockwork,” Kowalski explains. “Heaven forbid the internet goes out or we get stuck in a traffic jam and can’t go as fast as we want to, and that’s immediately going to trigger dissatisfaction.”
Credit card rewards are nice for those who have them. They’re also not special gifts from the sky you’re entitled to because you’re modestly decent with personal finance or follow the Points Guy.
Why we’re like this
Consumer culture hasn’t always been this way, with expectations as high as they are, but we’ve gotten here over about the last century and a half. As Amanda Mull outlined last year in the Atlantic, merchants drew in buyers and trained them in a certain way — to believe that they’re guests, to get reassurance, to be told that they’re always right. Tipping culture emerged, tying a server’s pay to the whims of a consumer instead of a living wage. People’s identities became increasingly intertwined with consumerism and buying, with people comparing themselves to peers and consuming more in order to keep up. Mass manufacturing and mail-order delivery and merchandising and transportation have made it easier for people to get more and more stuff.
As companies have competed for our business, and technology has made the consumer experience feel even more efficient, expectations have risen. Customers are constantly updating their expectations based on prior experiences, advertising, competition, or the economy in general, explained Jihoon Cho, an assistant professor of marketing at Kansas State University’s college of business administration. And how they evaluate a service is whether it’s better or worse than expected rather than the objective measure of the actual service.
“The way we evaluate things is a function of expectations,” said Deborah Small, a marketing professor of psychology at Wharton. “If we’re used to a level of customer service, which Americans are, and then things change, like prices go up or things slow down, the violation of that expectation is what causes disappointment, anger, all of these sorts of things.”
Thirty years ago, people were generally fine with whatever they ordered off of the television arriving in five to seven business days, because it was the status quo. Now, thanks to Amazon, even two days can feel like an eternity.
David Mick, a professor of commerce at the University of Virginia, describes the situation as the “er” phenomenon, where people are led to believe that there is always something better ahead. “If you think about packaging or advertising, products across the spectrum are constantly positioning themselves as softer, sweeter, easier, smoother, quieter, longer-lasting, or just the big word, better,” he said. “We’re always being set up that whatever we’re looking at or considering to buy is better.”
Once expectations rise, consumers have a hard time going back. We’re averse to loss.
We’re seeing this clearly during the pandemic. Supply chain woes, staffing shortages, and other pandemic-induced uncertainties have translated to all sorts of shortcomings when it comes to what consumers expect, and there are all sorts of examples of people reacting terribly in turn. Passengers are attacking flight attendants on airlines. Customers are throwing fits in restaurants and grocery stores and retailers. They’re mad about wait times and inflation and thinly stretched staff. They’re also mad they’re not in the right when they refuse to wear a mask or show a vaccine card or, simply, wait.
Workers, in turn, are suffering. According to a June 2021 survey from Snagajob and Black Box Intelligence, 62 percent of restaurant workers report experiencing emotional abuse and disrespect from customers. The Association of Flight Attendants said in July 2021 that 85 percent of flight attendants dealt with unruly passengers in the first part of 2021, and 17 percent had experienced a physical incident. Consumers have been told they’re always right for decades, and for some, when that’s not the case, their reactions are extreme.
“Other countries have a more balanced view on ‘the customer is always right,’ and that’s somewhere that we can dig in as a society,” said Melissa Swift, US transformation leader at Mercer, a work consultancy firm. “Why do we believe that? That doesn’t have to be a baseline assumption.”
In a world where the consumer wins, there are often losers, whether that be workers, the environment, or the other consumers they’re competing with to get a piece of some limited socioeconomic pie. Inequality drives all sorts of anxieties and a class of what Richard Reeves, author of Dream Hoarders, describes as “opportunity hoarding” among the upper-middle class to try to maintain their place in society and keep others down.
The design of our consumer economy means we’ve made a collective set of moral and ethical calculations that some trade-offs are worth it. It’s a choice that servers in the United States are still paid a wage of $2.13 an hour and left to hope that generous consumers — who enjoy lower prices for their meals — tip them. It’s a choice that the gig economy of companies like Uber and DoorDash provide people with low-priced convenience without thinking too hard about the economic and personal consequences for workers. It’s true that Amazon and Walmart keep prices low — including for low-income consumers. It’s also true that the way they do it is by paying its employees very little and squeezing every ounce of work out of them that they can.
“For the past few decades, we basically built large sectors of the economy around cheap and easily available pools of labor, and we organized parts of our legal system to ensure companies had access to large pools of low-wage labor,” said Brishen Rogers, a Georgetown law professor focused on labor.
Part of what’s causing consumers such frustration right now is that cheap pools of labor are not so easily available. There are worker shortages across the economy, and the labor market is so tight that workers are able to change jobs quite easily — and say no to some of the most grueling jobs altogether.
There’s a limit to how “customer-centric” businesses can be. “You can start to do things to be so overly focused on your customer that you cause systemic breakdowns,” Swift, from Mercer, said. There are some jobs that have become so intensified that basically there’s no amount of money that makes the work worth it for some workers. It’s no longer a question of how much any business or customer can pay. Some people just don’t want to be teachers or child care workers or work in hospitality or food service — the demands of the job, including from customers (or, in the case of teachers, from parents) are just too much.
When Walmart workers quit, they often make the same joke: “I promoted myself to customer.”
It’s not super fun to be a consumer right now. Prices are rising, plenty of products take a long time to get or are unavailable, and many businesses are really short-staffed. Corporations are asking for patience from frustrated consumers as they try to make up for lost ground, but it’s important to note that corporations have a big role in how consumerism got here in the first place.
Susan Strasser, a historian of American consumer culture, stressed that consumer expectations in the US are a corporate creation. She pointed to the example of the mail-order business in the late 19th and early 20th century, brought about by companies such as Sears and Montgomery Ward. Previously, most people relied a lot on things that were locally produced, often by people they knew. When they were able to order by mail from catalogs sent to their homes, the whole system changed. “What it meant was everything American manufacturing was producing was available to people,” she said. “That kind of consumption, that kind of distribution, that kind of merchandising coincided with an avalanche of stuff.”
Yesterday’s Sears is today’s Amazon — you can get anything and you can get it fast, and you often don’t see the inner workings behind making what you’re getting possible. “As automated as it may be at Amazon, and we know it’s highly automated by the way that we can just click and it comes, there are people,” Strasser said.
Through advertising, marketing, merchandising, and other practices, corporations are ultimately the ones managing expectations. On credit card rewards, for example, credit card companies spent years competing with each other to make rewards bigger and better. It’s a good deal for the consumers who reap those rewards, but it’s making things harder for those who don’t.
Still, in the current moment, consumers are being met with a reality that for years a lot of people could conveniently ignore. “We have become an entitled society,” said Mark Cohen, director of retail studies at Columbia Business School. “We have been blessed, up until the last two and a half years, with relatively little, if any, inflation, in fact, deflation in many categories. We’ve been blessed, for those involved, with very low interest rates and pretty much open-ended availability of money. People have been able to buy houses and cars and use their credit cards.”
The distorted reality we’ve been living in over the past two years, he said, has made everybody “grumpy,” and that often boils over in our consumer experiences and in retail. “The supermarket, the gas station, the department store, the mall, it’s kind of where it all comes to a head.”
Right now, consumers are having to lower some of their expectations by force — and many, understandably, don’t like it. But it may also be a moment to reflect on how we got here and whether we want to stay here. Consumerism means we often make things worse for each other, whether it be hoarding toilet paper, yelling at a service worker, or replacing an item that’s perfectly fine.
“It really comes down to the trade-offs and what, as a society, we value,” Small said. All else equal, efficiency is good, quality is good, lower prices are good. But all else isn’t equal. “Nobody argues that they’re not valuable, but it comes down to how we as a society think about trade-offs.”
Companies and capitalism and society have trained us to be bad consumers. It’s behavior that can be untrained, too.
We live in a world that’s constantly trying to sucker us and trick us, where we’re always surrounded by scams big and small. It can feel impossible to navigate. Every two weeks, join Emily Stewart to look at all the little ways our economic systems control and manipulate the average person. Welcome to The Big Squeeze.
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