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Why Prosperity Has Increased but Happiness Has Not

nytimes.com

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Re: Why Prosperity Has Increased but Happiness Has Not

#91

Post by phil21 »

Aloha wrote: post #32
ams6110 wrote: post #28

Earlier quoted context omitted.

Ever compare a 1940s middle-class house to a middle-class house of today? They're tiny. They probably have one bathroom. The bedrooms will be small. The garage, if there is one, is probably not attached to the house. The household probably had one car. Maybe had a phone, maybe not. Such a lifestyle could still be afforded buy a single income earner if they would really live the way a 1940s family lived.

I dont get the desire for huge houses - finding a nice 1500sqft home is hard - yes the extra space is great, but I gotta heat and cool that space. Beyond that - in 1948, radio was something everyone hard, Television was a luxury, a home phone was pretty universal, owning a car less so, even electric coffee pots were seen less often - no smart phones, tablets or home computers - though many had a typewriter. People wr…

The thing is though the whole "kids these days with their fancy TV and cable and monthly bills!" is almost becoming outdated, and was only a "thing" for a few decades.

Now I can replace all of that with a single device and single monthly bill - a device I need to have professionally anyways to participate in most of the economy.

My slightly younger millenial friends probably have monthly recurring expenses not a whole lot more % of income wise than the 1940's. They pay for a cellular data package and have a relatively modern phone, and that's about it. A 52" flat-screen TV is less than the cost of a radio in the 1940's today - it's just not relevant.

Re: Why Prosperity Has Increased but Happiness Has Not

#92

Post by aylmao »

r00fus wrote: post #62
daniel_levine wrote: post #47

Earlier quoted context omitted.

Real GDP per capita covers this. Inflation encompasses cost of living. https://fred.stlouisfed.org/series/A939RX0Q048SBEA Missing a breakdown by quartile, but it's the right metric

Does GDP per capita actually compare to median income? Sounds more like it uses mean income which is skewed by extremes (e.g. high earners).

This. An incredibly rich top 0.1% percent could skew GDP per capita a lot, but a happiness index not so much.

Simplifying things to the extreme, take 100 people where half of them earn $1 and are unhappy and half $2 and are happy. Give one person a $150 raise-- you just doubled the GDP but at best increased happiness by 1%.

It is no secret that a small percent of people have been getting very rich [1].

[1]: https://money.cnn.com/2011/02/16/news/economy/middle_class/i...

Re: Why Prosperity Has Increased but Happiness Has Not

#93

Post by _ptgt »

slv77 wrote: post #63
randomdata wrote: post #49

Earlier quoted context omitted.

> In the 40s and 50s a middle class household could get by just fine (and the house be bought) by a single income earner. Has that really changed? A manufacturing business in my area is currently hiring everyone who shows up to an interview. They pay they are offering isn't wonderful (at least if you concept of money has been warped by the IT industry), but you should expect to make around $40,000 per year to start.…

Households today spend more on cell phones and communication but also spend less on fine china, dress clothes and food. When you net out all the pluses and minuses households today spend much more on housing, healthcare, daycare, transportation (two cars, for two jobs) and education. When you look closely the two bed, two bath detached home it’s likely in a school district that is underperforming and while the home m…

Actually, I think the housing price expectations discrepancy is probably a function of where you live vs where the GP lives. Inflation-adjusted housing prices haven't actually risen all that much outside top-tier cities.

http://www.realestatedecoded.com/case-shiller/

Given that a relatively small percentage of people live in these places, I get the feeling the perception of a housing price crisis is larger than the reality. I don't mean to say that housing isn't unreasonably expensive in some places, but that the issue likely receives disproportionate attention because it most strongly affects those who tend to write and read about issues like a housing price crisis (i.e. journalists, software developers, economists, etc. who often live in these expensive cities). The people dictating and participating in these conversations are those who are living in expensive cities.

For the typical poor person, I suspect the costs of higher education and healthcare are usually a bigger obstacle than housing costs. Though this is probably not the case for a poor person in San Francisco.

Re: Why Prosperity Has Increased but Happiness Has Not

#94

Post by ams6110 »

phil21 wrote: post #90
ams6110 wrote: post #28

Earlier quoted context omitted.

Ever compare a 1940s middle-class house to a middle-class house of today? They're tiny. They probably have one bathroom. The bedrooms will be small. The garage, if there is one, is probably not attached to the house. The household probably had one car. Maybe had a phone, maybe not. Such a lifestyle could still be afforded buy a single income earner if they would really live the way a 1940s family lived.

My father's house was built in the 1940's and is as you described. It's now going for over $225k in a flyover state. He bought the place in the 80's for $72k on a $40k/yr salary - and the job he held to pay for it pays $44k/yr today. The exact same house is out of each for the exact same job today. Housing has skyrocketed by all available metrics. The one that matters most of course is % of after tax income spent, an…

The other thing people were more willing to do in the 1940s was move to where they could afford to live.

Re: Why Prosperity Has Increased but Happiness Has Not

#95

Post by rossdavidh »

coldtea wrote: post #14

The title is a little out of date. Prosperity has been increasing in the 20th century, but has not increased for a few decades. Sure, crap like gadgets is now cheaper, but buying a house, giving your kids an education, and so on have increased. In the 40s and 50s a middle class household could get by just fine (and the house be bought) by a single income earner. Such a house now would be on the verge of bankruptcy. A…

Timely support of your point: http://peterturchin.com/cliodynamica/population-immiseration... Prosperity stopped increasing in the late 70's, by a variety of measures (some of them even biological/medical).

Re: Why Prosperity Has Increased but Happiness Has Not

#96

Post by randomdata »

cc439 wrote: post #89
randomdata wrote: post #49

Earlier quoted context omitted.

> In the 40s and 50s a middle class household could get by just fine (and the house be bought) by a single income earner. Has that really changed? A manufacturing business in my area is currently hiring everyone who shows up to an interview. They pay they are offering isn't wonderful (at least if you concept of money has been warped by the IT industry), but you should expect to make around $40,000 per year to start.…

>A manufacturing business That alone cuts out nearly half the country. The skilled labor economy has been hollowed out and is nearly extinct in most places. You and I live in similar places and the dream remains alive here, but it is long dead in the corner of the country in which I was raised.

It is true that you may have to move to find places where a single income can buy a house, but that has always been true. The necessity of having to move to find better economic conditions has been true since the dawn of humankind. It's why we left Africa, and eventually covered the globe.

It is not like in the 40s and 50s you could live anywhere you wanted either. In fact, the 40s and 50s is right in the heart of the urbanization movement that happened precisely because capital concentrated, exactly like what is happening in many major cities today, and regular people could no longer afford to live where they grew up and had friends and family, and were left with little choice but to leave their existing life and head for the city to start a new one.

It wasn't particularly pleasant. Most people don't crave that kind of adventure. Most people would rather stay near to friends and family and the life they know, but sometimes you don't get that option. That remains true today.

Re: Why Prosperity Has Increased but Happiness Has Not

#97

Post by refurb »

slv77 wrote: post #63
randomdata wrote: post #49

Earlier quoted context omitted.

> In the 40s and 50s a middle class household could get by just fine (and the house be bought) by a single income earner. Has that really changed? A manufacturing business in my area is currently hiring everyone who shows up to an interview. They pay they are offering isn't wonderful (at least if you concept of money has been warped by the IT industry), but you should expect to make around $40,000 per year to start.…

Households today spend more on cell phones and communication but also spend less on fine china, dress clothes and food. When you net out all the pluses and minuses households today spend much more on housing, healthcare, daycare, transportation (two cars, for two jobs) and education. When you look closely the two bed, two bath detached home it’s likely in a school district that is underperforming and while the home m…

If you maintain a 1920s lifestyle today, you probably could work just a few hours a week.

Thing is, nobody wants that kind of a lifestyle.

Re: Why Prosperity Has Increased but Happiness Has Not

#98

Post by roenxi »

rossdavidh wrote: post #95
coldtea wrote: post #14

The title is a little out of date. Prosperity has been increasing in the 20th century, but has not increased for a few decades. Sure, crap like gadgets is now cheaper, but buying a house, giving your kids an education, and so on have increased. In the 40s and 50s a middle class household could get by just fine (and the house be bought) by a single income earner. Such a house now would be on the verge of bankruptcy. A…

Timely support of your point: http://peterturchin.com/cliodynamica/population-immiseration... Prosperity stopped increasing in the late 70's, by a variety of measures (some of them even biological/medical).

If we peg the 1970s as when things changed, that is about the time that Bretton Woods/the gold standard ended and growth in GDP growth stopped being a proxy for per capita growth of energy use.

Hard to know if that was cause or effect though, it seems unlikely that the monetary system changed because everything was going well. It does suggest the modern monetary system is a bit of a lemon.

EDIT scratch that, it is madness to say it is causal. But it does do a great job of hiding symptoms.

Re: Why Prosperity Has Increased but Happiness Has Not

#99

Post by aylmao »

analog31 wrote: post #30
maxxxxx wrote: post #21

People feel happier when they feel secure. We have nicer gadgets now but life is also more stressful because finding a stable long-term career is more difficult.

Indeed, thinking about my own life, I hoard wealth because of the risk of an event such as a medical emergency, unemployment, or my kids not being able to launch their own careers.

I find this interesting and it reminds me of a friend of mine who is Finnish. After college, she moved back to Finland, knowing she wouldn't make as much money there as she would in the USA.

But she also mentioned she wouldn't need to. There, she didn't have to worry about saving money for her kid's college and a medical emergency was affordable without touching into life savings. Buying a house was the big she could think of saving money towards.

Re: Why Prosperity Has Increased but Happiness Has Not

#100

Post by InclinedPlane »

randomdata wrote: post #66
torpfactory wrote: post #60

Earlier quoted context omitted.

I think folks are spending quite a bit more on things they need which used to be much cheaper. Healthcare and higher education come to mind as expenses which have started to eat the average family's budget much more than in the past. The medicine is much better today than in the 50's of course. We ought to include a full picture of required spending in relation to housing costs.

On the other hand, essential costs like food and clothing have dropped substantially over time. In the 40s and 50s food and clothing accounted for approximately 50% of one's disposable income. Now it is closer to 30%. But your comment does raise an interesting question: If I were to hypothetically spend $100,000 for an optional status symbol like a Ferrari or higher education and can no longer afford to own a home du…

Spending on food, clothing, and housing does not factor into "disposable income".
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