Posts Tagged ‘American Standard of Living’

Gadgets getting cheaper, necessities more costly

May 5, 2014


I’m old enough to remember when a personal computer or even a television set were so expensive than an average person couldn’t afford it.  But nowadays second-hand television sets and electronic gadgets are so cheap that hardly anybody does without them.

The things that are increasingly out of reach are child care, health care and education — the things you need to rise in the world.   The things that are affordable are the games, toys and entertainment that distract you from your condition and reconcile you to the limited life that you have.

Click on  Why America’s Essentials Are Getting More Expensive While Its Toys Are Getting Cheaper for more by Derek Thompson for The Atlantic.

Click on How the Middle Class Lifestyle Become Unaffordable for thoughts of Charles Hugh Smith.  One factor I failed to note in my original post is Baumol’s Disease, which is that as technology makes manufactured goods cheaper, the costs of human services become relatively more expensive.  [Added 5/7/14]

The old American myth and the new one

February 20, 2014

When I was growing up, most Americans believed that one of the things that made our country exceptional was “the American standard of living” — that Americans of all social classes were better off than their counterparts elsewhere, and that is why everyone would want to move to the USA if they could.

Now we’re adopting a new belief — that what makes our country exceptional, at least compared to European nations, is that we Americans are tough and therefore don’t need job security, guaranteed medical care or all the other things that cushion their lives.   However, if the Europeans follow their present austerity course, we may not be exceptional in that respect, either.

Are we Americans just a bunch of malcontents?

December 2, 2013


My friend Anne e-mailed me an article entitled Everything Is Amazing and Nobody Is Happy by Morgan Housel for The Motley Fool.  He says the American standard of living is just great, and American pessimism about the economy is not based on any fact.

Click on the link and see if you agree.  I don’t see it.  Housel’s basic argument is that we Americans live longer and enjoy longer retirements than in the past.  That is, in fact, true for me. But unless something changes, I don’t think it is going to be true for my niece and nephew, who are in their 20s, and their young children.

i_feel_fine_its_my_standard_of_livingWhat I see, as I look around, is (1) the evaporation of good jobs in manufacturing, (2) expansion of low-wage jobs in fast-food restaurants and chain stores, (3) evaporation of pensions and other benefits, (4) workers laid off in middle age who are surviving on a combination of part-time and temporary jobs, (5) young workers doing the same.   There are Americans in high tech and high finance who are doing well, but they are a minority.

A book (which I haven’t read) entitled Average Is Over by an economist named Tyler Cowen says the future economy offers little to most Americans.  He argues that high technology and automation will provide great opportunities for the most intelligent and enterprising 15 percent of the population, but the rest of us will have few opportunities except in service jobs providing for the affluent.  I don’t think his prediction is inevitable, but I certainly think it is possible.

Of course average Americans are much better off than their ancestors a century ago, and infinitely better off than child laborers in the sweatshops of Bangladesh or forced laborers in the cotton fields of Uzbekistan.  But our country is moving backward, not forward.  There’s no law of nature that says that, just because we’re Americans, we are guaranteed the “American standard of living”.