How Much Worse Off Are We?

Tech Central Station ^ | 7/15/2004 | Arnold Kling

[William Terrell]

Back then a man could work at an ordinary job, his wife could stay home and they could afford to raise kids, buy a house, a car and go on vacations. And that was the norm.

Today it is the rare exception. Whatever changed, something changed, and it is not good for the country or our quality of life. The media is burning up today with explanations, rationalizations and isolated statements of how that observable difference in life doesn't matter and how good we have things now.

The very fact that so much effort has to be turned toward explaining over and over again how every thing's fine makes me think everything is not fine. You may notice that the source of all the blue sky is the national government or individuals and groups that depend on the largess of the government to exist.

The maxim still applies: you don't take counsel about the benevolence of a thing from those whose livelihood depends on the existence that thing.

[Alberta's Child]

And that was the norm.

And that's really the heart of the problem here. People nowadays look back at a brief period of time in the late 1940s and 1950s and call that "the norm," when in fact it was really just an anomaly of the post-WW2 era when the United States was the only industrialized nation in the world that emerged from World War II with its industrial capacity unscathed. Add to that the growing suburbanization of this country that resulted from the most massive socialist program this country had ever implemented up to that point (the development of the Interstate Highway System), and you've got a "norm" that was anything but "normal" in any sense of the word.

I agree that everything is not quite right these days, but I think it has less to do with middle-class economics than with a general decline in our culture. In a nutshell, it is all about the way an annual trip to Disney World has become a God-given rightm, and carrying a firearm has become a crime.

[William Terrell]

What I said wasn't just the norm in the '40's and '50's. It was the norm in 1932, 1912, 1892, 1824, ect., right back to England and another gross central government again.

[WilliamofCarmichael]

The important point to bear in mind is that "the bottom fifth of the wage distribution" does not represent some permanent group of people. Instead, it signifies the earnings of workers who at that time have the lowest levels of skills and experience. My college-age daughters, doing temporary clerical work, are in the bottom fifth. But even if the income of the bottom fifth were to stagnate over the next twenty years, my daughters will earn higher incomes as they acquire valuable knowledge.

http://www.census.gov/hhes/income/histinc/ie3.html

Table IE-3. Household Shares of Aggregate Income by Fifths of the Income Distribution: 1967 to 2001

From the table of Share of aggregate income

Below represents the year and the lowest fifth through the highest fifth shares of aggregate income; plus the top five percent.

2001.........3.5, 8.7, 14.6, 23.0, 50.1, 22.4

1970.........4.1, 10.8, 17.4, 24.5, 43.3, 16.6

So what? Isn't it historically natural that the rich get richer? At least here in the U.S. the rich are not always the same families.

The stats I would like to see are the 2004 number of families that appears in each column; the question being, "Are the higher paying (middle-class jobs) disappearing while lower paying jobs are increasing?" To wit, as our wealth is redistributed to developing countries per leftist ideologues' and "free" traders' dictates, are American workers paying the entire cost of the scheme? That strange partnership lets the socialist ideologues and conservative capitalists "free" traders reap the benefits.

"Indeed, we have become so rich that we are approaching saturation in the consumption not only of necessities, but also of goods recently thought to be luxuries...Virtually everyone who is old enough and well enough to drive a car has one. In the case of television, there are 0.8 sets per person (2.2 per household)...The level of saturation for many consumer durables is so high that even the poorest fifth of households are well endowed with them."

So we are much better off because we got more thingies. Whoopie. Oh, how about comparing consumer debt in 1970 and now? I don't recall getting calls and junk mail everyday with offers of credit cards back then.

In the 1970's, ordinary working people drove Vegas and Pintos. They did not eat out much. They rarely traveled by airplane. Many of their jobs were dangerous. Do you really think that there are many working Americans today who would trade places with their 1970's counterparts?

No sources provided. So I'll say that there are more older cars on the road today. There are more fast food joints today. The airline industry was regulated back then, it's cheaper today. More dangerous jobs than today? Really? Yes, many people would change back to a more stable employment environment.

Does me having opinions contrary to the Party line mean that I hate President Bush? No. I plan to vote for him -- I appreciate him letting our military take the war to the enemy.

[Alberta's Child]

You've got to be kidding me.

Go back and read any U.S. history book, and see what life was like for the "middle class" throughout most of this country's history.

I don't recall the Ingalls family buying lots of horses or going on any vacations in Little House on the Prairie. The reality is that life was harsh for most people back then -- and "home ownership" was largely nonexistent until the U.S. government started giving land away to settlers (that's right -- another big-government socialist program).

Before the 1950s, most of the "middle class" in our urban areas lived in homes that they rented from someone else.

[William Terrell]

Not talking about the middle class. I'm talking about a family where the man works and supports the family adequately, and no one else in the family has to. Certainly, there were exceptions, but the exceptions prove the rule, and that has been the norm until the present age.

[WilliamofCarmichael]

RE: "the most massive socialist program this country had ever implemented up to that point (the development of the Interstate Highway System)"

Maybe so but my recollection is that it was a defense project. It's comparable to Defense Advanced Research Projects Agency's (DARPA) internet, IMO, except that the interstate was available to civilians immediately. I believe that both were related to measures needed given the possibility of nuclear attacks on the U.S.

[ninenot]

40 years ago Tax Freedom Day was March 13th--meaning that (roughly) taxes take an additional 12.5% of income today.

God only KNOWS what 'tax PLUS regulation' Freedom Day was back then. Today it's around July 1st.

The Cost of Gummint is a significant part of the problem.

[ninenot]

Your contention is precisely that of the Rockford Institute's (back when Allan Carlson ran it--a reliable guy.)

[ninenot]

That Camelot-period was interrupted by LBJ's gift to Corporate America: EEOC.

While it is now a burden, at the time it encouraged women to join the workforce. Of course, they were "cheap labor," as time-in-grade had a good deal to do with compensation.

Now they are NOT so "cheap," and the work's going to China.

See the pattern?

[ninenot]

Well, I'll take Alberta's side in this one.

The Wife was always a worker--on farms back in the 1800's. And her contribution was not merely cooking/cleaning/ironing. It involved physical labor with the cows, horses, etc.

Factory-work for men provided SOME relief from the two-(imputed) income necessity on the farm--but only in the large cities were women able to "not work" outside the home. Of course, at the time, the income tax did NOT exist.

For obvious reasons, women worked in factories and on farms during WWII.

Remember that the LGWU was founded for "Ladies."...there were plenty of working women.

[js1138]

I'm pretty sure microwave ovens were available in 1970. In fact they haven't changed much since then.

[William Terrell]

All the changes FDR and LBJ made were socialist in nature. Women in the workforce is a socialist concept, and requirement to produce the output that is necessary to support a socialist state. In my opinion, any change that encouraged or drove women into the work force in mass was planned for that purpose.

[William Terrell]

Yes. Women have always worked. Married women didn't always work, but only in times of dire economic stress. Consider, if it had been always custom for married women to hold down a job there would be no debate about it; there would have been no change to call attention to it.

If you really want to know precisely what the customs and conditions in an era were, read appellate and supreme court cases occurring in that period. Most of the time the judgments and rulings in a case depended on the peripheral economic, political and societal environment at the time. Such courts had (and have) teams of legal assistants for that kind of research, and much about a period was discussed in the opinions.

History books are frequently a bad source for history. Not all, but, nowadays, most.

[ninenot]

A very good suggestion. OTOH, given the prolixity of some lawyer-friends of mine, I may not live long enough to read a few sessions' decisions.

[William Terrell]

Well, I'd have to say prolixity is a feature of court opinions, some of which yawnity may be relieved or compounded by sometimes having to diagram the sentences to extract the meaning from the multiplicity of the compound/complex/zzzz clauses therein.

It gets easier with practice (pun intended).

[Mears]

That car and radio ownership quote is hysterical.

I feel like a teenager and want to say "Well,duh".

[Mears]

In the seventies I was middle aged,today I'm ancient.End of story!

[Iris7]

Thanks for the ping.

The American Dream is proving pretty hard to put back together. Humpty Dumpty and all of that.

[Last Dakotan]

Today, half of those in the labor force, supported by generous pensions, retire in their fifties."

Mostly those who work for governments.