The middle class, then & now
By Donald J. Boudreaux
Published: Tuesday, Dec. 25, 2012, 9:15 p.m.
Recently in The New York Times, Paul Krugman gazed backed longingly at the 1950s: “America in the 1950s made the rich pay their fair share; it gave workers the power to bargain for decent wages and benefits; yet contrary to right-wing propaganda then and now, it prospered. And we can do that again.”
That decade was indeed one of strong economic growth in America. And while we can debate whether this growth occurred because of, or despite, high marginal tax rates and high rates of worker unionization, I want instead to address Krugman's implication that today's economy — with its lower tax rates and less-powerful unions — keeps middle-class living standards lower than these should otherwise be.
Unfortunately, we can't observe parallel universes: the early 21st century as it actually is and an alternative early 21st century with more of the “progressive” policies that Krugman favors. Therefore, no indisputable conclusions are possible about how well-off middle-class Americans are today compared to how well-off they would be with different policies. But we can at least assemble some facts to put today's condition of America's middle class into clearer perspective.
Specifically, let's look at how much time the typical full-time nonsupervisory private-sector American worker today must toil to buy common household items, and then compare that time to the time required of a similar worker in 1956.
This comparison can be made by consulting the retailer Sears. Sears has always been, as it remains, a retailer for middle-class America.
I just bought on eBay (a convenient retail platform not available in the 1950s!) a fall/winter 1956 Sears catalog. By looking at the 1956 prices listed in that catalog, we can determine how long an ordinary worker back then had to work to buy specific items, such as shirts, shoes, kitchen appliances and lawn-care items.
For example, Sears' lowest-priced power lawn mower in 1956 sold for $46. The typical American worker earned an hourly wage then of $1.89. So the ordinary worker had to work about 24.3 hours to earn enough (pre-tax) money to buy that lawn mower. In contrast, by going to Sears.com, we find that Sears' lowest-priced power lawn mower today sells for $170.99. Because the typical nonsupervisory worker in America now earns an hourly wage of $19.84, that worker today must work only about 8.6 hours to buy a similar lawn mower.
That is, a simple power mower costs a typical worker in 2012 only about a third of the work time that a simple power mower cost a typical worker in 1956. So at least when it comes to power lawn mowers, American workers today are much better off than they were in the mid-1950s.
The same is true, thankfully, for many other goods. A simple ensemble in 1956 of Sears's lowest-priced women's clothing — blouse, jeans, pumps, panties and bra — cost the typical worker in 1956 5.2 hours of work time. A similar ensemble of clothing today costs the typical worker a mere 2.9 hours of work time. That is, such clothing is today 44 percent less costly, in terms of work time required to earn enough money to purchase it, than it was in 1956.
None of the above adjusts for quality changes, and (contrary to its old advertising slogan) Sears didn't sell everything. One can, therefore, always quibble with the value of such comparisons of work time. But as my next few columns will suggest, these comparisons are nevertheless productive and very revealing.
Donald J. Boudreaux is a professor of economics at George Mason University in Fairfax, Va. His column appears twice monthly.
Show commenting policy
TribLive commenting policy
You are solely responsible for your comments and by using TribLive.com you agree to our Terms of Service.
We moderate comments. Our goal is to provide substantive commentary for a general readership. By screening submissions, we provide a space where readers can share intelligent and informed commentary that enhances the quality of our news and information.
While most comments will be posted if they are on-topic and not abusive, moderating decisions are subjective. We will make them as carefully and consistently as we can. Because of the volume of reader comments, we cannot review individual moderation decisions with readers.
We value thoughtful comments representing a range of views that make their point quickly and politely. We make an effort to protect discussions from repeated comments either by the same reader or different readers.
We follow the same standards for taste as the daily newspaper. A few things we won't tolerate: personal attacks, obscenity, vulgarity, profanity (including expletives and letters followed by dashes), commercial promotion, impersonations, incoherence, proselytizing and SHOUTING. Don't include URLs to Web sites.
We do not edit comments. They are either approved or deleted. We reserve the right to edit a comment that is quoted or excerpted in an article. In this case, we may fix spelling and punctuation.
We welcome strong opinions and criticism of our work, but we don't want comments to become bogged down with discussions of our policies and we will moderate accordingly.
We appreciate it when readers and people quoted in articles or blog posts point out errors of fact or emphasis and will investigate all assertions. But these suggestions should be sent via e-mail. To avoid distracting other readers, we won't publish comments that suggest a correction. Instead, corrections will be made in a blog post or in an article.
- Analysis: Steelers could fill needs with free agents while not spending big bucks
- Steelers to release LaMarr Woodley; Taylor restructures contract
- Crosby lifts Penguins over Capitals in last game of road trip
- Stage volunteer dies following collapse at Pine-Richland High School
- Supreme Court ruling to affect few bicycle trails in Pennsylvania
- Top pitching prospect Taillon’s time with Pirates must wait a bit
- Missing hikers found in McConnells Mill State Park
- Fear of building collapse closes Tarentum road
- Hempfield couple charged in thefts
- Penguins notebook: Heralded Russian Evgeny Kuznetsov debuts with Capitals
- Pirates notebook: Martin finding power stroke