Infernal Ramblings
A Malaysian Perspective on Politics, Society and Economics

Markets and Consumerism

Written by johnleemk on 12:11:18 pm May 31, 2007.
Categories: ,

Today I watched the Pirates of the Caribbean 3 — a rather decent, and at times hilarious, film. What annoyed me the most about it, however, (and if you do not want even a slight hint of what happens, don't read further) was how blatantly it set things up for a sequel.

Maybe I'm seeing things that aren't there, since my sister insists there's no room for a Pirates 4, but considering the large number of loose ends, and the open-ended finish, plus that "Now Presenting" scene post-credits...I would beg to differ.

What irritates me is that although this is not as blatant as Pirates 2 was, it still seems quite clear that they intend to keep on making movies, without much of an end in sight, until people get fed up with watching the movies.

I freely admit that there is not much basis for my grumbling about this consumerism, since it is the right of everyone else to spend their money as they wish. By deciding their money is better spent on an umpteenth sequel to Pirates, they are playing their role in the market, and by deciding that maybe I would prefer to buy the DVD rather than tickets to see Pirates 56, I am playing my role.

Of course, there are many self-righteous hypocrites who would beg to differ. I am sure there are quite a few people out there who decry the consumerism they see in our society, who feel that our money could be put to better use.

However, this forgets that the primary purpose of the economy is to benefit society — and if society decides it is better served by mindless action movies featuring half a dozen computer-generated clones of Johnny Depp, who is to question this?

That isn't to say the market is perfect. Those who think the market can do no wrong are only slightly less ignorant than those who think the market can do no right.

But those who would prefer to ban or tax or otherwise create a disincentive for people to watch Chow Yun-Fat attempt to rape Keira Knightley just to ease their conscience about the economy's poor treatment of certain classes of society are not going about things the right way.

There are uses for indirect taxation, but taxing consumption is generally not a good idea. Indirect taxes should be used to correct for certain costs society does not take into account — for example, we do not pay for the pollution generated by our visit to the theatre, so a tax to correct for this cost would be completely justified.

But taxing those who watch Pirates 3 or buy a new luxury car just for the sake of taxing them is really one of the sillier things you could do. If you want to tax the rich, why not just tax the rich and be done with it? What's wrong with a good old direct tax like the income tax?

By creating a disincentive to watch the mindless offerings of Hollywood, the government would be attempting to achieve its objective of social justice or whatever in a rather roundabout way. Unless our goal is just to punish the rich, instead of helping the poor, an indirect tax on consumption is not the brightest of ideas.

Kneejerk reactions to consumerism are not good basis for economic policymaking. We should decide what we want to do — penalise the rich, help the poor, save the whales? — and do whatever most directly gets us there, with the fewest possibilities of unintended side-effects. An indirect tax on consumption is thus not the best answer to the problem of consumerism — assuming, of course, that the problem is not that people spend their money foolishly, but that not everyone has the same opportunity to earn the money to waste on consumerism.

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Infernal Ramblings is a Malaysian website focusing on current events and sociopolitical issues. Its articles run the gamut from economics to society to education.

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