It would make sense that a society that consumes more goods requires more income to pay for those goods. My wife and I were doing a routine review of finances recently and made a list of the things we regularly use/pay for that our parents did not:
Internet service
Satellite TV
Cell Phone Service
Movie rental service
Consumer loans on 2 laptops
Gasoline (and other expenses) for 2 vehicles
Music (CD) club
Somewhere along the line, an “official” document somewhere broke down the cost of a loaf of bread and a pound of beef – I have looked for hours online for something like that, but can’t find it. It would be telling, I think, to know what % of the cost of a loaf of bread today is spent on transportation compared with 50 years ago. I’ve also looked for but cannot find any kind of comparison of overall energy costs, adjusted for inflation, over the past 50 years. Energy drives our economy and is part of the cost of everything.
And don’t discount the increased safety demands of the consuming public We want our cars to be indestructible coccoons of safety in the event of a crash, get great gas mileage and not pollute the air. That’s one expensive vehicle! Extrapolate that over the rest of society – medicine, working conditions, building codes and so on – and safety comes with a pretty hefty price tag.
This is a very telling point. I think it’s part of the all-American concept that our children have to be better off than we were. Actually, my wife and I had pretty good childhoods – we never went hungry, we were safe and secure, our parents had pretty much guaranteed employment and income (my father was a cop, hers was a farmer) and we enjoyed good nutrition, excellent health care and a solid education. But our parents wanted us to go to college; we were pretty much indoctrinated that we wouldn’t have to work long, hard hours to support our families. It didn’t quite work out that way, but that was the “dream.”
You are of course correct that too many do not have this access, but there is another part of the issue. (Again, we may have to take this to another thread.) Fifty years ago there was no Medicaid. No Medicare. Those were instituted in part because of stories about the elderly and the poor having to decide between food and medicine. The services provided by the Medi-s may not be optimal, but they do exist.
Also the costs of the services they do provide now vs. the services available in, say, 1940, are far more extensive. In 1940 there was no debate about would the government pay for Grandpa’s bypass surgery – the concept did not exist. There was no concern about would the government pay for Junior’s mumps vaccine, or Sister’s rubella vaccine if dad was gone and mom unemployed (or unemployable).
It’s sort of like debating over whether the cost of VCRs is higher now than in 1950.
The increased tax burden for the common people. It’s not a coincidence that the middle class keeps having to pay more while the rich keep getting taxes slashed.
It’s been going on for decades, not just the last decade.
It’s really not correct to say people lived on ‘one income’. The wife generated wealth for the family, but she did it within the boundaries of the household. Back then, women had to work hard. There were no microwaves, no packaged meals, no washing machines or electric irons or wash-and-wear fabrics.
It’s hard to fathom how much work people had to do back then just to survive. I just washed a load of laundry here at home - it took my 5 minutes to throw it in the washer, five minutes to transfer it to the dryer when it was done, and 10 minutes to put it away. When I was a kid, I lived in a home that didn’t have a modern washing machine. We used a big steel tub full of hot soapy water (water that was hot because we laboriiously heated up kettles of water on the wood stove - about a dozen to get the right amount of water, as I recall). Then my grandmother would sit in front of the tub and scrub clothes on a washboard. She had a hand wringer to run the clothes through, then she’d take them out on the line to dry. After drying, she’d have to gather them all in and then iron them all. Along the way, she almost always found little tears in elbows or on socks, and those clothes would get put aside for mending.
In the evening, while we sat around talking or watching the black-and-white TV they had, she would mend clothes.
She would make breakfast in the morning, then have to wash all the dishes (again, no dishwasher - they were all washed and dried by hand). Then it was out to the garden (many people, even city dwellers, had gardens back then, because the lack of refrigerated transport made fruits and vegetables expensive and hard to get). She’d work for hours in the garden weeding and tilling by hand, with breaks to make lunch. In the fall, she did canning - harvesting her own vegetables and preserving them for the winter. That job took about a week of solid labor.
And so it goes. Every little convenience we take for granted now, from automatic coffee pots to being able to stop at the 7-11 on the way home for milk and eggs, was a major chore for women back then. And what they did WAS household income. They created wealth for the family. Sewing clothes was also much more common back then. Sewing clothing is income whether your customers are in a store or your own family.
Because everything was manual, there were very low to almost-nonexistent electrical bills. No consumer electronics to break down and replace. No internet fees, no cell phones, their phone was a party line (two longs and a short was their ring, as I recall), and had only a nominal cost. The wife of the family probably ‘earned’ several hundred dollars a month providing services to the family that we would pay cash for today. And everyone lived with a little less.
I think the ‘golden age’ of the single-worker family is a myth. People managed to live on single incomes back then because they worked harder and made due with less, and because the other partner worked just as hard, only at home.
Sam’s talk about family service made me think of an article I read once while waiting in the doctor’s office. The articles main thesis was that women didn’t have more spare time because of labor saving devices, they had more spare time because they had fewer sick family members to nurse.
The argument was that as incomes rose and people began to get vacuums and washers, the level of expected cleanliness went up. Women spent the same amount of time cleaning, they just got more clean out of it. You didn’t just have your work clothes and Sunday clothes, you changed every day.
But before birth control and antibiotics, someone was always sick, they were sick at home, and how well they were cared for could be a matter of life and death. A cut could mean blood poisoning if mom didn’t work to keep it clean.
I’ve always wondered if any research had gone into the article or if it just sounded good to the writer. I do know that going back through the family tree, you can see the families getting larger the farther back you go. My mother and I each had three children. Her mother had four. Her mother had eight. Her mother had twelve. The topper for the records we have was in the 1700’s where one ancestress had eighteen. So that’s a fair hunk of work, and a reason not to work away from home right there.
Also, I’ve heard it said that two other culprits were bored-out-of-their-minds housewives one upping each other over housekeeping ( a variation of “keeping up with the Joneses” ), and electric lighting. Electric lights simply let you see dust and dirt better.
Cite that the wealthy are looting the middle class?
My wife and I moved last year. We moved from California, where the median price for a 3 bedroom home was approx $400,000 when I left.
We moved to a semi-rural area outside Pittsburgh. We bought a 3 bedroom house for less than $80,000. Granted, it has no yard, but it’s a HOUSE we OWN.
Is it possible that the middle class is stagnant because it’s a stepping stone? I was raised VERY lower class. Welfare, foodstamps, the whole nine yards.
I and my wife own a house. It’s possible, before we retire, my wife will have broken into the high 5 digits in salary. We are going to end our lives higher class than we were both born too, and I hope that my children do the same. A step up for them will be into the lower upper class.
So maybe the upper class is growing as people move out of the middle class and up to Upper Class, and the Lower classes move into Middle Class.
All-in-all, I’m really glad that I don’t have to beat out carpets. Although back in the good old days, that was what kids were for. If women worked in the house, so did kids, and everyone else, really.
I’m just so grateful for the indoor plumbing, though. Indoor plumbing rocks. I’ll put up with the two incomes and higher taxes if it gets me indoor plumbing. And paved streets. I think the first federally sponsored streets were part of a rural mail delivery act in 1916 or so. I’m prepared to be corrected. I like the paved streets. So much nicer than dirt roads when it rains. The horses legs don’t sink in. (In Stockton clay, they could sink to their knees.)
But the indoor plumbing is my favorite. This woman is about to leave her job for the day and go home and hug her toilet.
No, America is becoming less and less socially mobile; more and more people stay in the class they were born in. These days Europe and Canada are better places to rise out of poverty or the middle class.
Another thing that might be worth considering is the cost of commuting. I know this has been brought up earlier in the thread, what with walking or streetcars or even a horse, but it strikes me as a very large expense these days. Even if you don’t count the cost of that second (or third or fourth) car, I doubt a lot of people were routinely driving for an hour or two each way to get to a job. For instance, 25 years ago my parents lived in Falls Church, VA. As I understand it, back then that was just about as far west as anyone would live who routinely commuted to Washington (I believe Dad did that, going to work in Georgetown) and the area in between was fairly empty. Remember, too, that’s not even 10 miles, more or less (but I don’t know if I-66 was there back then.) They were, I believe, renting an apartment (judging by my baby pictures taken before we left VA.) These days, everything from Falls Church to Arlington is massively built up with lots of little suburbs and a ton of traffic and I think people are now living even further west than Falls Church and are commuting a good two hours or so each way to get into Washington. I drove through the area a couple years ago visiting some of my parents’ old friends in rural northern VA and thought it was massively crowded, incredibly ugly, and that the commutes must be a killer, even for that distance.
Can anyone back me up here on my specific example or on my idea in general?
(Not to rain on any sacred cows, but compare 2004 to 1994. In 2004 under Bush, the middle quintile paid a 13.9% effective Federal Tax Rate versus a 17.3% effective Federal Tax Rate under Clinton in 1994.)
What does all this mean, well, it certainly refutes this claim:
The share of income taxes paid by the rich has continually gone up, the share paid by the middle class (and the poor) has gone down.
The share of total Federal Taxes paid by the rich has trended upwards, and continues to trend upwards, the share of total Federal Taxes paid by the middle class has trended downwards.
The share of Federal income taxes paid by the rich (top 1%) has increased from 18.3 to 36.7. In spite of the fact the tax rate has gone down from 70% for the top bracket to 35% for the top bracket over that time span.
The share of total Federal Taxes paid by the top 1% has increased from 15.4 to 25.3 over that same time period.
Over the same time period, the share of Federal Income taxes paid by the middle quintile has decreased from 10.7 to 4.7. While the share of total Federal Taxes paid by the middle quintile has decreased from 13.2 to 9.7 Interesting that the share of income taxes has dropped precipitously, but the share of total taxes has not. That’s because payroll taxes are a double edged sword for the middle class. Payroll taxes make it more expensive for employees to hire people, thus depressing creation of new jobs. It also only taxes the first X amount of income, meaning the middle class have always paid a larger burden of payroll taxes.
Of even more interest is, the top 1% would be just as happy to slash or remove payroll taxes as the middle quintile, the top 1% are the ones whose businesses have to match the amount of payroll taxes their employees pay.
The effective total tax rate (or burden) for the top 1% has gone down from 37 in 1979 to 31 today. The effective rate for the middle quintile has gone down from 18.6 to 13.9 So in general the tax cuts have both reduced the burden of both the rich and the middle class, and increased the total share of taxes paid by the rich while decreasing the total share paid by the middle quintile.
A final point is an interesting before and after analysis of the Bush tax cuts (here.) The only group of people whose share of the taxes went up were in the 4th and 5th Quintile (top 40% of earners.) The Bush Tax cuts have often been said to have helped the wealthy while screwing the poor. The facts suggest the truth of the matter is, they helped the top 1%, did not help or possibly hurt the top 5%, top 15%, and top 20% as a whole, and helped the lower and middle classes. Although in truth it only redistributed the tax shares so that the “upper middle class” and “lower upper class” started to shoulder a greater share and decreased (marginally) the share of the top1%. They decreased the tax burden across the board.
That’s not a bad thesis. The “angel in the house” was often the woman nursing someone sick.
Before vaccines it was not uncommon to have illnesses like diphtheria, measles, mumps, tetanus pretty much all the time. These were sicknesses that could take a long time to get over. They were also very contagious so you might be dealing with an entire sick family at once. Pertussis can take months to get over and have lingering side effects.
It takes a lot of nerve, or something, to link to a thread you started with your analysis of a NYT article as a “cite.”
Capitalists “not sharing their profits” != “stealing.*”
Employees are being compensated a wage while the ownership reaps the profits, that’s what capitalism is all about. You aren’t entitled to a drop of a corporation’s profits unless you own shares in the corporation. If you work you’re entitled a wage, agreed upon by both parties and generally set by the labor/job market, you’re not entitled to profits.
If you want to reap those big rewards, start investing. No risk, no gain.
*And they actually do share their profits, as legally required through taxes, they aren’t required to share them with their employees unless their employees are also stockholders.
Sorry, Martin. It’s just not as tidy as you would make it. And I’m no statistician or economist. How about taking your first chart and breaking down by adjusting for inflation.
Sam Stone, that is absolutely one of your finest posts ever! Thanks for bringing back some of my own memories. It’s been a while since I churned butter or watched the chicken I would eat for supper run around without its head.
Your post was so practical that I wondered why we all didn’t see the truth of it sooner. Of course it was work – hard work. And it still can be if we take on too much or try to do it all ourselves or be perfect.
I read a great book called Never Done about the history of housework. At the time I was a snotty college student who was appalled by the idea that women of the past had “wasted” their lives being housewives (an attitude learned from my hard-core feminist mother). I gained more respect for my foremothers than I could ever have imagined. I’d never really considered how much of what we buy (as in, nearly everything) was once made by the housewife, and what “starting from scratch” really means.