35.5 – The Social Waste of Capitalism
Learning Objectives
By the end of this section, you will be able to:
- Analyze the relationship between social waste and cost minimization
- Define the vicious cycle hypothesis of cost shifting and social waste
As shown in the previous section, cost shifting in capitalism means that business leave costs unpaid which are nevertheless socially necessary costs in the sense of necessary for sustainable social provisioning. These social costs have to be paid no matter what if society is to be able to reproduce itself and thrive in the long run. The question involved here is primarily the distributional question of who pays these social costs, that is, an issue of socio-ecological justice. As shown, preventing or reducing cost shifting and social cost deficits where possible is also more efficient than fixing them more expensively afterwards. This demonstrates how the critique of cost shifting expresses a joint concern for sustainability, justice and efficiency.
Cost shifting as Social Waste
There is, however, an additional category of social costs that are unnecessary additions to above necessary social costs of sustainable social reproduction that businesses leave unpaid. These types of social costs are completely unnecessary from the perspective of society but emerge because they are very profitable and not prohibited with robust enough enforcement. As such they are social waste as they reflect additional and unnecessary social opportunity costs in excess of the minimal social costs of social provisioning. A brilliant example is the overproduction and marketing of sugary and fatty foods marketed to children, which result in ill-health ranging from obesity, diabetes, and dental decay. These are socially costly for individuals and society in terms of health care, and foregone human wellbeing and life expectancy. Other examples include planned obsolescence, when companies reduce the life cycle of products so consumers have to discard them and buy new ones. Additionally, repairs or replacements of parts are intentionally barred such that a fault in one part of the product causes the entire product to become wasted. This leads to a throw-away consumerism and ever-growing barrage of waste and pollution. A good example is the case of Apple who forced an update onto users’ I-phones to slow them down. Conveniently, this occurred at the time of the release of the new I-phone so as to incentivize consumers to buy a new phone and discard their old phone.
Again, as discussed above, the reason is the institutionalized principle of investment for profit rooted in capitalist accounting rules and property rights, not some impossibility of socio-ecologically efficient engineering. Engineers are well capable of building durable consumer products that are repairable with exchangeable parts, making precious resources last longer, reduce and recycle waste flows.
Cost Shifting and Social Waste vs. Cost Minimization
This theory of soci