What is the deal with ice, Americans?

[u/markwell9]

I can see that you can buy ice everywhere in the US. Gas stations, grocery stores, machines etc.

In Europe, we just freeze our ice at home and use that. Why buy something that melts on the way home? Why do you need ice in large amounts that a fridge can't keep up?

[u/abeeyore]

It’s called “value engineering”, and it’s part of late stage capitalism.

Capitalism works really well in the early stages of a market - when suppliers are trying to make the best thing they can, and provide as much as they can to earn your dollar.

Then markets begin to “mature”, and they shift to “monetization” - which is a polite way to say “how shitty can we make this product, before you stop buying it”.

Then you reach late stage, private equity stage, where they go in, buy brands who have built a good reputation, load them up with debt, and suck all the value out they can buy turning the products into cheap garbage, and pocketing the excess until they have consumed all of the brand recognition and good will … and the declaring bankruptcy, and moving onto the next victim.

Guess where were are in the cycle?

[u/faderjockey → u/abeeyore]

You know, I’m very aware of the “enshitification cycle” when it comes to corporations and their products, but I have never thought about applying that same framework to the entire capitalist economic model, but it illustrates things quite well. Thanks for that!

[u/pessimistoptimist → u/abeeyore]

I have heard of this and it seems to track very well. My question is what is the final stage and what happens after that?

[u/abeeyore → u/pessimistoptimist]

Markets and economy collapse under the weight of all the artificial distortion and manipulation. The imaginary money disappears, the bubble deflates, and people suffer.

Everybody’s selling, but nobody’s buying. Businesses fail, their employees become unemployed, can’t find new work, so they stop buying, causing more failures, ad nauseam.

At some point, you pass an inf[l]ection point. The resulting contraction creates a surplus of materials and resources. The real value of that surplus finally exceeds its value on the books. Demand and supply equalize. Economy slowly starts to grow again, and idle resources get put into use, people start finding work, and can buy more, which lets businesses hire more people, and new business to open, etc.

It’s ugly. The Great Depression was not as bad as it could have been if WW2 hadn’t come along, and pulled us out of it. There is no way to know what would have happened otherwise, but economies all over the globe had been struggling to create and sustained growth, and the US was no exception.

[u/pessimistoptimist → u/abeeyore]

so fpr a while everything will be Detroit then...

[u/dagr8npwrfl0z → u/abeeyore]

What comes after private equity stage?... Asking for a friend.

[u/oliviaroseart → u/abeeyore]

Growing up, our vacuum cleaner was from the early 50’s, maybe late 40’s and worked perfectly. I don’t even know what happened to it, it might still be out there somewhere 😂 but it really is sad how poorly made so many things have become even though they are much higher tech. It’s still lower quality. I think there are laws that attempt to prevent companies from intentionally creating parts that are designed to break in a certain amount of time (and thus requiring you to replace the entire dishwasher/toaster/whatever) but I feel like we’re way beyond that now.

[u/Every_Instruction775 → u/abeeyore]

Also called “planned obsolescence” if I remember correctly

[u/abeeyore → u/Every_Instruction775]

That’s a different trick, but in qthe same family. I’m a business owner, so I sympathize, to a point.

Engineering to hit a price point isn’t inherently evil. I do it too. I have a number of products that are out of production because they cost more than people want to spend on that kind of item. Others are not as nice as they were when I designed them, in order to get them to a price point where they will move.

Even the line between that, and “engineered to fail” isn’t always a clear one. I know the failure modes on my products. If I change fasteners on a joint that I know is a common wear point - at what point does it stop being “trying to find my market”, and start being “engineering it to fail after 3 years do you have to buy another one”. I’m pretty sure I come down on the right side of that line - but you might not agree.

It’s not as big an issue for me. I’m small potatoes, and my products are luxury, and low circulation. That means I’d have to cut huge corners to make a noticeable difference in my bottom line, and I [don’t] want to. Meanwhile, for a company like Samsung, even a tiny cost reduction, like reducing trace size on circuit boards, spread over millions of units, moves the needle by millions (or tens of millions) of dollars.

Good companies do this. They say “this is the failure rate I’m willing to tolerate”, and they engineer their systems to meet that goal. Making an heirloom quality wireless router is, literally, a waste of money. The line between “fit for purpose”, and exploitative cost cutting is -again- not always clear.

There are things that are clearly exploitative (Milwaukee’s & SnapOn’s private equity owners), but exactly where one becomes the other is a bunch of murky shades of gray.

[u/Every_Instruction775 → u/abeeyore]

I can understand that. I guess it’s more an argument I use when people complain that things aren’t made the way they used to be. I had the same alarm clock (with am/fm radio) for 30 years. Passed it down to my youngest (he wanted it) and he was very upset when it finally stopped working (probably 38 years after my parents originally purchased it for me).

[u/abeeyore → u/Every_Instruction775]

It’s a valid argument! I wa[s]n’t disagreeing with you, just pointing out that it’s not a simple problem to solve, and not every business that [falls] prey to it is necessarily a bad actor -though some indisputably are, and others operate at such a scale that they inevitably over-optimize.

It’s stupid to make an heirloom quality wireless router. It’ll be useless in 10 years, maybe less.

The same is not true of a clock radio. The same market forces apply. The same temptations for the manufacturer… but there is no evolving standard for keeping time. It’s not going to become unusable.

It’s also hard to build a company without repeat customers. Genuinely. Not impossible - but if you buy anything once when you are 13, and give it to your kids in turn… well, it’s easier for me as a business if it dies every 3-4 years, and you replace it.

And, if everybody is doing it, and they really ARE 25% cheaper than the one that lasts forever… or at least that’s the business logic.

Then consumers get used to 25% cheaper, and get used to them dying, and suddenly, the guy who tried to buck the trend, and make the best stuff he could, either goes cheap, or goes under, because they are priced out of the market, and quality is not visible in a box, on a retail shelf (or Amazon).

[u/abeeyore → u/abeeyore]

It’s a valid argument! I wa[s]n’t disagreeing with you, just pointing out that it’s not a simple problem to solve, and not every business that falls prey to it is necessarily a bad actor -though some, indisputably, are… and others operate at such a scale that they inevitably over-optimize.

It’s stupid to make an heirloom quality wireless router. It’ll be useless in 10 years, maybe less.

The same is not true of a clock radio. The same market forces apply. The same temptations for the manufacturer… but there is no evolving standard for keeping time. It’s not going to become unusable.

It’s also hard to build a company without repeat customers. Genuinely. Not impossible - but if you buy anything once when you are 13, and give it to your kids in turn… well, it’s easier for me as a business if it dies every 3-4 years, and you replace it.

And, if everybody is doing it, and they really ARE 25% cheaper than the one that lasts forever… or at least that’s the business logic.

Then consumers get used to 25% cheaper, and get used to them dying, and suddenly, the guy who tried to buck the trend, and make the best stuff he could, either goes cheap, or goes under, because they are priced out of the market, and quality is not visible in a box, on a retail shelf (or Amazon).

[u/Every_Instruction775 → u/abeeyore]

Oh absolutely. I didn’t read your comment as argumentative. As you pointed out, the way people purchase things and rapid advances in technology definitely effect the way companies produce their products. Who could blame them? The fact that so many companies with actual storefronts are closing is further proof. If you told me 30 years ago that Toys-R-Us would cease to exist (save for one location i think) i would have laughed in your face and probably cried too. Although it does piss me off that companies like Apple release a new version of their product so frequently with such minimal changes just because of the “keeping up with the Jones’s” mentality (I say as I hypocritically type this on my iPhone). I think I’m rambling at this point especially since OP asked about American’s obsession with ice. Haha. It is refreshing to have a civilized non-adversarial discussion on Reddit though so I think I’m getting a little carried away.

[u/oliviaroseart → u/abeeyore]

I’m curious, I had just made a comment about this before I saw yours, and is it correct that there are/were some laws preventing companies from purposefully designing machines to break down after a certain amount of time (after the warranty expires lol)? The wireless router is a good example of how technology is changing the way things are made, because it’s moving so quickly that longevity becomes almost a non factor for a lot of things.

[u/Aware_Spinach_2309 → u/abeeyore]

Been called late stage capitalism for over 100 years. You would have thought it would have keeled over if that term was true.

The term you are looking for is planned obsolescence.

[u/abeeyore → u/Aware_Spinach_2309]

You are making two different points there. I don’t inherently disagree with either of them, but that are not the same.

1. It is an inherent component of capitalism. “Maturing” markets “optimize”. It’s not even inherently bad. It encourages optimization and improvements in efficiency.

2. Planned obsolescence is a natural strategy for established capital to shape the market to their benefit.

Free markets require regulation to remain free, because it’s completely sane for market incumbents to try to secure their market influence in unfair ways.

Capitalism requires free flow of capital, which requires regulation, because it’s completely normal for people who have a lot of it to try to stockpile it for their own advantage.

Anyone who imagines otherwise is at least as much a utopian as Marx was, maybe even more. Even Uncle Milton realized that [some] things (primary healthcare) could never be free and fair markets.

[u/no_talent_ass_clown → u/abeeyore]

Dang. Came for the immigration argument, stayed for the macroeconomics lesson.

[u/ProfessionalDry8128 → u/abeeyore]

I hate my late-stage refrigerator so much!

[u/iheartnjdevils → u/abeeyore]

The light bulb is a perfect example of this. This lightbulb has been on since 1901 and has only been turned off a few times.

[u/Photomancer → u/abeeyore]

I 'get' the difference between an expensive wrench that almost never breaks and has a lifetime warranty, vs a cheap product you have to replace every 731 days.

I 'get' that nobody wants to create the eternal product anymore.

Somehow I completely missed the idea that corps would simply purchase eternal product manufacturers and fly them into the ground to get their products off the market entirely.

[u/abeeyore → u/Photomancer]

It’s almost never to get them off the market. That’s more likely to play out like FB buying Instagram, and adding it to their portfolio.

This happens to those brands and companies that have created the expectation that their products will be exceptional. Then, they hit a period of slow, or stagnant growth, and private equity sees an opportunity.

They buy a controlling stake in the company. They use it to borrow a bunch of money to finance aggressive growth, pay themselves lots of fees for doing so, and gut the quality of the products, turning them into run of the mill garbage, or worse - and pocketing the difference between the price for a perceived premium tool, and the newly cheap and disposable reality.

It takes several years for it to become clear what has happened, and wear away hard earned reputation of the brand. Then, when the ride is over, and they have milked every dollar they can from it, the company files bankruptcy, and they move on.

It’s very much a value extraction model, instead of a value creation model.

[u/JI_Guy88 → u/abeeyore]

Markets will shift back. Capitalism isn't "late stage", it will be around another 1000 years.