I am an economist. I now straight up laugh when I hear this claim when people try to act like this county is poor.
Americans consume a lot. If people were living paycheck to paycheck and destitute then why is the median car sold in the US 2x the price of one sold in Europe? Why do 60%+ of Americans own their own homes? Why do people eat out more than ever?
I've spent the past decade-plus living in Vietnam and whenever I see online people from rich first world countries -- not just the US but I also see it in Australia, Sweden, and so on -- that try to pretend their life is a daily struggle for existence and I can't help but wonder what's gone wrong with society.
I don't want to discount their experiences entirely but it's hard for me to get past that there's a reason Vietnamese smuggle themselves to the US and Americans aren't smuggling themselves to Vietnam. So what has gone wrong with Western society that everyone is so miserable? Or at least acts that way online? I don't think it is quite right to say it is "all in their head". I often wonder if it is more a problem of expectations than reality? They've been trained to expect the top of Maslow's pyramid of self-actualisation for 99% of society -- thanks to a steady diet of "do what you love and you'll never work a day in your life" and "chase your passion" and "what color is your parachute" and so on -- but that kind of Star Trek utopia is still decades (or more away) from being reality. And modern media (not JUST social media; you'd be amazed how many parents feel threatened and discouraged by Bluey's perfect-parenting) also often paints the picture that life should be cruise street for basically everyone, adding to the problem.
expectations vs reality is a big part of it - this is the "elite overproduction" theory, to a degree.
there's also social capital to be gained on the left by purporting that the US is awful, because if that's the case then we need leftist policies to fix it.
Mondaire Jones, a D congressional candidate, said America has a "broken economy" on the Bulwark pod last week. He's a Stanford, Harvard and Davis Polk alum. When someone that accomplished, running as a D candidate under a D President, speaks like that, it's kinda inevitable that more everyday folks will use similar language.
This makes sense to me as a Republican. The historian Michael Kazin argues the central thread of the Democratic party for 200 years has been moralizing capitalism, or finding ways to rally a working class to morally reform it. It makes sense Democrats have no way to enjoy a bustling economic status quo the way a center-right party of mid-sized business and middle class voters does. It is at odds with how their party looks at politics.
The people writing click bait articles in CNBC or WSJ about how if you live in NYC or SF and make $500K you can’t survive and live “paycheck to paycheck” are not Democrats. Or at the very least not writing from a Democratic perspective.
It’s like the NIMBY debate. Matt focuses his ire on left of center NIMBYs because he’s left of center, lived in a blue city and as a left of center writer might actually have some sway with this slice of the population. But if you look at polling, more self identified republicans than democrats are NIMBY.
And yes where I live, it’s the right of center of people who use “paycheck to paycheck” language and are more NIMBY
Most CNBC and WSJ news reporters are moderate Democrats. The finance men who read them are generally in either party. Most journalists, with the exception of explicitly right-wing media, are Democrats. This has been true for a while; journalism is a creative job, and it's challenging across history to name any truly talented artists who have normie Republican politics. (There are a few with eccentric reactionary politics, which isn't really the same type of person or voter as one happily voting for Bob Dole.) Michael Kazin's scholarship corroborates the latter occupation's bipartisanship; he has a great chapter on late 19th century Democratic party financing from an eccentric man in Manhattan that might be of interest. Chuck Schumer is the Senate majority leader for a reason. If Democrats were socialists, this would be a problem. But they aren't and never have been. They are center-left populists.
I agree NIMBY is pretty bipartisan. The difference is sitting on decades of property value accumulation and environmentalism is central to how the upper-middle class functions in California politics compared to Texas politics. The progressive gentry is important to why Democrats run their states the way they do. It's also why as Silicon Valley's crypto and AI sectors began consuming energy per customer a little more in the direction of car factories (very high) and a little less in the direction of server farms (very low), their votes began changing too. Turns out if you wants lots of energy, you have to accept tearing up land for more transmission lines and being open to a variety of low cost options like natural gas. So abundance liberalism people are going to run into the problem, regardless of if Trump or Harris wins, that Democrats just aren't really a supply-side party. They never have been.
Finally, I'm sure you know Republicans who are unhappy with inflation, like Republican politicians, and might exaggerate the precarity it has caused for many planning their finances and large purchases like cars and houses. But it's neither here or there with my point about the parties and how they generally view the economy. The big reason economic sentiment is lower than in 2019 is Democrats just aren't as hyped about the economic status quo as Republicans. Both will happily exaggerate the problems with an opposing leader in the White House. Democrats said the economy sucked in 2019. But the difference is Democrats can't really convince themselves the economy is automatically great when team blue is in charge. They're more like the types to insist on loan forgiveness of various indebted artisans and aspiring middle class voters, whether under Andrew Jackson or Joe Biden. Populism, in other words.
In my red state I'm subjected to constant uninvited whining from Archie Bunker-like strangers about how Biden is "killing them" because eggs are 25 cents more expensive this week.
The last few years have featured several people who soiled Stanford's name, but I definitely cringe every time I hear about him. What an embarrassment.
I do think that most of the critics on the left don't think the country is poor. They believe that its rich, but all the wealth is concentrated so that the average person is poor. Wealth is pretty concentrated, but the average person isn't poor.
Even the 20th percentile person isn't poor. We should do better at redistribution, but we're making progress even at low incomes and we're doing okay compared to other rich countries on the whole
What's the full context of the 60% home ownership rate? That number has never made any sense to me. Is it "60% of adult US citizens live in households who jointly own their own home", or some such? How do eg children figure into this equation? What about owning a house on a mortgage? How about multi generation families who all live in the same house? What about someone who rents an apartment? And so on.
Okay, but if that's what it's supposed to mean, is that really accurately characterized as "60%+ of Americans own their own homes"? For instance, if an adult lives with their parents in a house owned by the household, and then the parents kick their adult child out, then suddenly this home ownership rate has decreased, even though no actual property has changed hands, right?
I believe that’s just a new household creation. The adult child would have been counted under their parents’ household, so they aren’t inflating the household homeownership rate. They just get counted as a new household when they get kicked out.
Fair enough, but then quoting that 60% home ownership figure without including the word "household" (as often happens, incl. at the beginning of this comment thread) does indeed reduce the statistic to meaninglessness.
My guess is that homeowner households are on average larger than non-homeowner households, so if 60% of households are homeowner households, then well over 60% of people live in homeowner households.
Just for clarification - now we've got two "60%" figures. One is the fallacious claim which is the topic of Ben's essay about living paycheck-to-paycheck, and the other one is about home ownership (also pertinent to this discussion.)
I find the home ownership figure interesting and maybe distressingly low. Outside of New York City, most people are unhappy if they have to rent. Part of this is justified by what I perceive is a cultural inability on one hand of many Americans to be considerate of their neighbors and on the other hand of many Americans to figure out how to shrewdly deal with their current life circumstances. As a lifelong renter-by-choice, I also know that effort and resources on the part of owners and managers also has a major impact on the liveability of rental properties.
Absolutely - Europeans live much closer together. As a mere traveler to Europe, I'm not privy to how they all manage to get along with each other in those apartments (we know that the cultural diversity of the incomers from their former colonies causes enough stress to lead to nationalist movements.)
Growing up in spacious suburbs in the late 20th and early 21st centuries can be terribly misleading for our social media addicted progeny.
Apartments are better constructed. You don’t hear your neighbors much. Cross-ventilation and family-sized and -friendly floor plans are the norm, possible because single-stair access is legal, and fire safety doesn’t suffer. Building codes in the U.S. mostly mandate shitty apartment buildings.
Single-stair access isn't perfect - it makes me a bit uncomfortable unless there are extra fire escapes (like those scary tunnel-ladders set into balconies in Japan.) I stayed in an apartment building in Brussels that had been converted into short-stay units. I could see a fire escape from the hall window for another unit, but my unit didn't have one--only the stairs. I assumed that those two units had formerly been one apartment. My unit was on the street so theoretically the fire department could have reached my window, but who knew. So I'd have to know more about fire safety redundancies in Europe.
As for double stairs, our five-over-ones, often made of wood and particle board, are 100% reliant on sprinkler systems which require maintenance, testing and ongoing code enforcement. Stairs are always just there. (I would love to have cross-ventilation - the stove and bathroom vents help a little though.)
This is correct. It is much lower than that in Austria and Germany, but higher in other places. It seems to vary significantly by country. In Germany the majority rent.
I'd love to know more about the exact wording. I have had a pet theory for a long time that a significant percent of people just hear "paycheck to paycheck" as a kind of banal aphorism like "live one day at a time" or "workin' for the weekend" or something like that.
It's because Americans love to complain about how hard they have it, even when they don't.
While it's certainly true that the inflation of the last few years has hit my personal budget kind of hard, its not been bad enough to actually make me stop eating out all the time, buying Starbucks frequently, or spend less on clothes. I have been putting off a car purchase lately, but that is more about personal discipline than "I can't afford the payment".
I don't tend to whine and complain about prices like other people, but that might be because I'm a Democrat. If Trump were president now, I'd probably be joining in on the complaning.
One thing I've noticed online recently is that there is a hostility to the idea that individual financial decision making should matter at all. When people complain about the price of DoorDash or travel or some other luxury, the implication is that no one should ever be forced to consider a budget and make a more prudent decision (I say this as someone who probably eats out more than I should).
I wonder if this is partially due to the influence of social media, particularly Instagram - if you regularly see other people your own age enjoying these things, you feel in some sense entitled to them even if they're really not in your price range.
This seems particularly true of UMC types in high CoL cities who think their high paychecks should be going further than they do.
Yeah--like, the $18 avocado toast obviously isn't why the median American can't afford a 20% down payment on a house in San Jose, but if you're feeling strapped, you might want to take a minute thinking about your spending choices.
And further, so much of the app-based food delivery stuff feels like people are just on autopilot. I like junk as much as the next person, but you're paying $25 to have soggy, lukewarm McDonald's delivered on the regular? Why are you doing that? Does that even feel good?
"you're paying $25 to have soggy, lukewarm McDonald's delivered on the regular? Why are you doing that?"
This is what kills me about the use of food delivery services for things outside of pizza and a handful of other types of cuisine -- you are manifestly getting a substantially inferior food product at a dramatically higher price! If you have to eat at home and don't want to make the effort to cook, it's still surely better to just eat a sub-$1 Cup o' Noodles and some chips rather than blowing the equivalent of an hour or more's after-tax-wages to get food in a condition that you would refuse to accept if a server brought it to you in a restaurant.
I have sat in a coffee shop and seen delivery app people come in for one fancy coffee drink! The delivery likely costs more than the drink. I hope they give a high percentage tip at least. Maybe someone is home with a sick kid or has agoraphobia or whatever, but I doubt that is most of it.
My son's roommate was going to order wings from a place IN THEIR SAME BUILDING to be delivered until the other guys in the apartment shamed him out of it. Granted, you have to go outside and walk a quarter of a block and it was winter in Chicago, but even so it was close enough to go out without a jacket or gloves and not be in danger of frostbite.
Idk last time I went to McDonald's I saw several doordash delivery people there. I agree that it's absolutely wild to order delivery McDonalds, since it is easy to take kids there or drive-thru. I say that as someone who thinks food delivery is really incredibly luxurious, both in that I feel so fancy when I do it and I really really enjoy it.
It is pretty grim to sit in a mostly empty restaurant watching the Doordash people come and go. Why pay downtown rents if you're not even going to go outside!
I do not know how common they are in the general population. I do know that other attorneys I work with sometimes will offhandedly mention getting non-traditional delivery food via some delivery service, so I presume it's not totally made up.
I'm sure they *do it*--I see my boss do the same sometimes--but does it reflect actual economic stress? My boss is a company founder and he's rich, he can do whatever he wants.
For us fancy restaurant DoorDash was partially a habit developed during COVID ("Yes it's an insane price and not as good, but we can't go out, so might as well order this") and now as a parent you're saving $35 an hour for a babysitter. It's definitely a worse product, but it's generally better than the alternative given limited time to cook.
I occasionally do fact finding with clients and whenever I get to the "what do you spend a month" question, it's always "I have no idea."
Ok, what's your monthly income from all sources? Are you saving any? No? Ok, are you going further in to debt? No? Ok, your spending is equal to your income then.
When people complain about the price of DoorDash, I think it’s less about the tradeoff between DoorDash and preparing your own food and more about how much more expensive DoorDash is than takeout.
Which is fair - when you account for increased menu prices, service fees, delivery fees, and tips, it’s a massive markup for a service that really doesn’t provide that much value other than avoiding the need to get off the couch and walk/bike/drive for 15 mins or so.
Of course why these people don’t just order takeout is unclear.
On the contrary, DoorDash provides a massive benefit. It is pretty to see that.
None of those restaurants offered delivery before DoorDash came along. Now people talk about having hundreds of options.
That's pretty clear indication that DoorDash is providing tons of value.
Not to mention they provide discovery of restaurants, online menus, online ordering, card payments.
Do people really not remember the old days when you'd call the pizza place and they'd answer but immediately put you on hold because there were four other customers also calling in? Then you ordered over the phone and had to repeat everything three three times to make sure they didn't mess up the order? And then they only took cash and god forbid you didn't have small enough bills for the driver to easily make change.
If you’re in an urban place, actually moving your car is a big barrier, and doing it on foot, bike, or public transit is a big chore, unless it’s on your block.
Yeah I wouldn’t usually do delivery or takeout from a place that close by - but during the pandemic I did, and I think some people might if they have some reason someone needs to eat at home (maybe a kid or a pressing work call or an injury or an important TV show to watch).
For what it’s worth I use it when I forgot my lunch. Doesn’t happen that often but I get 30 minutes for lunch and it has to also be the one time I get to go to the bathroom.
I mean at this point I usually am not really price sensitive. Just get me a burrito bowl and I’ll pay whatever you want but it’s pretty annoying that the vc subsidy for this went away and the price of making a small morning rush mistake went up 10 bucks. Not that any of this makes me feel poor that I sometimes have to overpay to get something vegan brought to my workplace.
We never, and I mean literally never, got delivery food when I was growing up. Zero times in eighteen years. You want a pizza, you make it or you go pick it up. What's ten or fifteen minutes of your time?
Now pushing the age of 40, I think I've increased this lofty total to twice--I got a couple of delivery pizzas left on the front porch when I had late-2021 covid.
I mean, I think we never did as well (I'm early 40s), but literally the only place that delivered to us was Domino's Pizza. If you wanted anything else, you had to go pick it up from the restaurant. We never ate Domino's, so it's not really much of an achievement to have never had delivery.
Nowadays, I'm richer than my parents were at my age, and Deliveroo says that there are literally 433 pizza restaurants that will deliver to me.
Same experience. And I have only ordered delivery maybe 2-3x in the last 5-6 years when UberEats offered me a huge coupon but required delivery (and I still did the math to make sure I came out ahead).
Agreed. I think there is a broader trend of absolute disbelief in agency, combined with what I feel confident calling entitlement and a curse of comfort. Right and left, there is outright disbelief that we should be held responsible for our actions. The right blames adverse outcomes at the individual level on this mythical notion of 'elites' and whatever conspiracy theory is popular at the moment, and the left blames it on nebulous and specious notions of 'social structures' and the tenuous application of tenuously defined mental disorders. I frankly feel that we are collectively undeserving of the system our ancestors sacrificed to build. We are fragile, self indulgent, criminally comfortable, and profoundly unserious.
It has started to occur to me that the closer we get to utopia (the more easily we can see it), the farther we realize it is. Which is why I think there is such agitation over economic philosophy in a country as comfortable as ours.
That said, I may fit into the last part of your comment somewhat. I make $150-165k/yr and live in Manhattan. I pay a little under $4k for a 350 square foot apartment on the third floor of a building with no elevator or washer/dryer (and I get absolutely fucked on taxes). While I'm not living paycheck to paycheck, I certainly don't have a ton left over after I pay my expenses, and I think it would be a difficult to characterize my lifestyle as lavish. And for what it's worth I do not use social media or know/give a shit how my friends are living.
This seems somewhat relevant to my recent post, which I will shamelessly plug.
Yeah, I do think there are unique situations like yours (and those situations are probably overrepresented in those who control The Discourse. That said, I'm guessing that living in Manhattan is a choice, made because of the substantial QoL it provides? Taking the tradeoff of a small apartment to live there is an example of the kind of lifestyle prioritization a lot of the biggest complainers argue shouldn't have to be made.
I think it’s very reasonable to expect to be able to afford to rent a small apartment in a good part of Manhattan and still save a solid amount per month on a 150k salary. And the fact that that is not the case is definitely indicative of a problem, although more one with Manhattan.
Yeah, absolutely, we need to build more housing and no city should be completely out of reach. But areas in demand will always have some element of scarcity that requires tradeoffs.
Oh for sure. Housing will always be expensive in New York. What you're saying applies, I think, to cities like DC or perhaps Boston where housing is very expensive but supply has more been able to keep up with demand. But New York, Manhattan in particular, is an example of extreme and deliberate supply suppression. If you walk through the most in demand neighborhoods here, so probably the most in demand and densely populated parts of the US, you will rarely find residential buildings that are above 5 stories (and they were usually built in the pre WWII era). It's to the point that unless you make 150, and probably even more, you have to make extreme tradeoffs that would be considered unreasonable anywhere else.
I don't recall right wingers in the 80s saying people were "rich," per se. The issue, which certainly goes back to at least the 1980s, maybe earlier, are surveys that show fairly large percentages of people who report being below the poverty line also owning things that were unequivocally considered "luxuries" (or completely unavailable) not that many years earlier -- color TVs, microwaves, and air conditioning are the big three that I can think of.
(People today really don't appreciate the point that color TVs continued to be sold at a substantial premium for a long time after color broadcasting became common. This is a subtle point made in "Wonder Woman 1984" of all places. Watch the teaser trailer from 33 to 43 seconds: https://www.youtube.com/watch?v=sfM7_JLk-84&t=32s If you pay close attention, you'll notice that the wall of TVs showing Maxwell Lord's ad are framed with signage saying, "Watch in Vivid Color!" and TVs in the shop window with patriotic bunting are 27" color TVs being advertised for $749.95 -- that's the inflation-adjusted equivalent of about $2300 today according to the BLS CPI calculator.)
To some extent this goes back to my theory of everything regarding inflation--general electronics stuff (TVs, laptops, whatever) generally becomes cheaper per unit "goodness", and the population is generally used to this.
Unless somebody comes up with a more efficient chicken egg delivery and collection system, eggs *cannot* become quote-unquote "cheaper" (whatever their dollar amount).
Well, the answer is that people did come up with more efficient chicken/egg delivery and collection systems ("factory farming"), but we've hit the limits of that. To put it another way, William Baumol won't stop ****ing that chicken.
Of course, absolutely. But the SV-minded "the world is our oyster, and once we demonstrate a single improvement one time, it will reliably be a permanent improvement forever" viewpoint is wrong.
Yeah, we get pizza or Indian delivered on occaision (two of the foods that actually hold up) but always scour the options available for discounts - you can easily find deals that essentially wipe out the cost of delivery if you're not picky.
Cutting your other spending to the bone would not actually solve the problem that the mortgage on an entry-level family home is 90% of your take-home pay. Even when the other 10% supports an excessive lifestyle by MCOL standards!
For one thing, you're a 10% pay cut away from default. You wanna bet that'll never happen over the life of a 30-year loan?
Right, this supposedly elite cohort is constrained by financial circumstances such that it would be unreasonable to hit normal middle class milestones, like buying an entry-level home for your young family. Which is exactly their point.
Yes. That’s one way you get “I spend $3000/mo on DoorDash and I can’t afford to buy a house.” Thats a stupid amount of money for DoorDash, but it’s also irrelevant.
Yeah, but the specific scenario you're describing is really only applicable to a few superstar cities. We should build way more housing in those places (this is Slow Boring, after all) but if a mortgage would be 90% of your take home in Palo Alto, you can probably find a similar paying job in Pittsburgh or Milwaukee.
“The biggest problem with perpetuating this economic myth is that it can push people towards some wacky policy ideas, like dismantling capitalism or imposing blanket tariffs to restore some rose colored-vision of manufacturing in mid 20th century America.”
I really don’t think hardcore leftists and identitarians realize how much they’re helping to perpetuate the status quo by siphoning political attention and energy from more plausible reformist politics that focuses on improving material conditions for those who are genuinely deprived.
For people like that, their ideological identity would be threatened if they didn't project the belief that radical change is always necessary onto circumstances where it doesn't fit. (Damn you, Karl!) You saw that during the Obamacare debate; there was no shortage of "progressives" who'd rather let people die than see a CORPORATION make a PROFIT off their health care.
I am an economist. I now straight up laugh when I hear this claim when people try to act like this county is poor.
Americans consume a lot. If people were living paycheck to paycheck and destitute then why is the median car sold in the US 2x the price of one sold in Europe? Why do 60%+ of Americans own their own homes? Why do people eat out more than ever?
I've spent the past decade-plus living in Vietnam and whenever I see online people from rich first world countries -- not just the US but I also see it in Australia, Sweden, and so on -- that try to pretend their life is a daily struggle for existence and I can't help but wonder what's gone wrong with society.
I don't want to discount their experiences entirely but it's hard for me to get past that there's a reason Vietnamese smuggle themselves to the US and Americans aren't smuggling themselves to Vietnam. So what has gone wrong with Western society that everyone is so miserable? Or at least acts that way online? I don't think it is quite right to say it is "all in their head". I often wonder if it is more a problem of expectations than reality? They've been trained to expect the top of Maslow's pyramid of self-actualisation for 99% of society -- thanks to a steady diet of "do what you love and you'll never work a day in your life" and "chase your passion" and "what color is your parachute" and so on -- but that kind of Star Trek utopia is still decades (or more away) from being reality. And modern media (not JUST social media; you'd be amazed how many parents feel threatened and discouraged by Bluey's perfect-parenting) also often paints the picture that life should be cruise street for basically everyone, adding to the problem.
expectations vs reality is a big part of it - this is the "elite overproduction" theory, to a degree.
there's also social capital to be gained on the left by purporting that the US is awful, because if that's the case then we need leftist policies to fix it.
Mondaire Jones, a D congressional candidate, said America has a "broken economy" on the Bulwark pod last week. He's a Stanford, Harvard and Davis Polk alum. When someone that accomplished, running as a D candidate under a D President, speaks like that, it's kinda inevitable that more everyday folks will use similar language.
It's ~47m in here
https://podcasts.apple.com/us/podcast/susan-rice-and-mondaire-jones-the-dictator-hugger/id1447684472?i=1000673342593
Not to be trite, but lots of people say stupid shit.
You should hear my rants calling the harbor ducks lazy communists living on hand outs.
This sparked my imagination in some truly spectacular ways. Thanks!
Freeloaders living on the dole!
Yes, but this is ridiculous. I think some people just mean housing costs when they talk like this, which are a real problem.
This makes sense to me as a Republican. The historian Michael Kazin argues the central thread of the Democratic party for 200 years has been moralizing capitalism, or finding ways to rally a working class to morally reform it. It makes sense Democrats have no way to enjoy a bustling economic status quo the way a center-right party of mid-sized business and middle class voters does. It is at odds with how their party looks at politics.
The people writing click bait articles in CNBC or WSJ about how if you live in NYC or SF and make $500K you can’t survive and live “paycheck to paycheck” are not Democrats. Or at the very least not writing from a Democratic perspective.
It’s like the NIMBY debate. Matt focuses his ire on left of center NIMBYs because he’s left of center, lived in a blue city and as a left of center writer might actually have some sway with this slice of the population. But if you look at polling, more self identified republicans than democrats are NIMBY.
And yes where I live, it’s the right of center of people who use “paycheck to paycheck” language and are more NIMBY
Most CNBC and WSJ news reporters are moderate Democrats. The finance men who read them are generally in either party. Most journalists, with the exception of explicitly right-wing media, are Democrats. This has been true for a while; journalism is a creative job, and it's challenging across history to name any truly talented artists who have normie Republican politics. (There are a few with eccentric reactionary politics, which isn't really the same type of person or voter as one happily voting for Bob Dole.) Michael Kazin's scholarship corroborates the latter occupation's bipartisanship; he has a great chapter on late 19th century Democratic party financing from an eccentric man in Manhattan that might be of interest. Chuck Schumer is the Senate majority leader for a reason. If Democrats were socialists, this would be a problem. But they aren't and never have been. They are center-left populists.
I agree NIMBY is pretty bipartisan. The difference is sitting on decades of property value accumulation and environmentalism is central to how the upper-middle class functions in California politics compared to Texas politics. The progressive gentry is important to why Democrats run their states the way they do. It's also why as Silicon Valley's crypto and AI sectors began consuming energy per customer a little more in the direction of car factories (very high) and a little less in the direction of server farms (very low), their votes began changing too. Turns out if you wants lots of energy, you have to accept tearing up land for more transmission lines and being open to a variety of low cost options like natural gas. So abundance liberalism people are going to run into the problem, regardless of if Trump or Harris wins, that Democrats just aren't really a supply-side party. They never have been.
Finally, I'm sure you know Republicans who are unhappy with inflation, like Republican politicians, and might exaggerate the precarity it has caused for many planning their finances and large purchases like cars and houses. But it's neither here or there with my point about the parties and how they generally view the economy. The big reason economic sentiment is lower than in 2019 is Democrats just aren't as hyped about the economic status quo as Republicans. Both will happily exaggerate the problems with an opposing leader in the White House. Democrats said the economy sucked in 2019. But the difference is Democrats can't really convince themselves the economy is automatically great when team blue is in charge. They're more like the types to insist on loan forgiveness of various indebted artisans and aspiring middle class voters, whether under Andrew Jackson or Joe Biden. Populism, in other words.
In my red state I'm subjected to constant uninvited whining from Archie Bunker-like strangers about how Biden is "killing them" because eggs are 25 cents more expensive this week.
The last few years have featured several people who soiled Stanford's name, but I definitely cringe every time I hear about him. What an embarrassment.
By the way, do you mean Davis Polk the white shoe firm?
Yes
I do think that most of the critics on the left don't think the country is poor. They believe that its rich, but all the wealth is concentrated so that the average person is poor. Wealth is pretty concentrated, but the average person isn't poor.
Even the 20th percentile person isn't poor. We should do better at redistribution, but we're making progress even at low incomes and we're doing okay compared to other rich countries on the whole
What's the full context of the 60% home ownership rate? That number has never made any sense to me. Is it "60% of adult US citizens live in households who jointly own their own home", or some such? How do eg children figure into this equation? What about owning a house on a mortgage? How about multi generation families who all live in the same house? What about someone who rents an apartment? And so on.
I believe it is ~60% of American households live in the dwelling for which they own the deed to.
Okay, but if that's what it's supposed to mean, is that really accurately characterized as "60%+ of Americans own their own homes"? For instance, if an adult lives with their parents in a house owned by the household, and then the parents kick their adult child out, then suddenly this home ownership rate has decreased, even though no actual property has changed hands, right?
I believe that’s just a new household creation. The adult child would have been counted under their parents’ household, so they aren’t inflating the household homeownership rate. They just get counted as a new household when they get kicked out.
Right, so then that does decrease the home ownership rate because that new household doesn’t own its dwelling.
Yes.
Fair enough, but then quoting that 60% home ownership figure without including the word "household" (as often happens, incl. at the beginning of this comment thread) does indeed reduce the statistic to meaninglessness.
My guess is that homeowner households are on average larger than non-homeowner households, so if 60% of households are homeowner households, then well over 60% of people live in homeowner households.
Just for clarification - now we've got two "60%" figures. One is the fallacious claim which is the topic of Ben's essay about living paycheck-to-paycheck, and the other one is about home ownership (also pertinent to this discussion.)
I find the home ownership figure interesting and maybe distressingly low. Outside of New York City, most people are unhappy if they have to rent. Part of this is justified by what I perceive is a cultural inability on one hand of many Americans to be considerate of their neighbors and on the other hand of many Americans to figure out how to shrewdly deal with their current life circumstances. As a lifelong renter-by-choice, I also know that effort and resources on the part of owners and managers also has a major impact on the liveability of rental properties.
It’s a lot lower in much of Europe, by the way.
Absolutely - Europeans live much closer together. As a mere traveler to Europe, I'm not privy to how they all manage to get along with each other in those apartments (we know that the cultural diversity of the incomers from their former colonies causes enough stress to lead to nationalist movements.)
Growing up in spacious suburbs in the late 20th and early 21st centuries can be terribly misleading for our social media addicted progeny.
Apartments are better constructed. You don’t hear your neighbors much. Cross-ventilation and family-sized and -friendly floor plans are the norm, possible because single-stair access is legal, and fire safety doesn’t suffer. Building codes in the U.S. mostly mandate shitty apartment buildings.
Single-stair access isn't perfect - it makes me a bit uncomfortable unless there are extra fire escapes (like those scary tunnel-ladders set into balconies in Japan.) I stayed in an apartment building in Brussels that had been converted into short-stay units. I could see a fire escape from the hall window for another unit, but my unit didn't have one--only the stairs. I assumed that those two units had formerly been one apartment. My unit was on the street so theoretically the fire department could have reached my window, but who knew. So I'd have to know more about fire safety redundancies in Europe.
As for double stairs, our five-over-ones, often made of wood and particle board, are 100% reliant on sprinkler systems which require maintenance, testing and ongoing code enforcement. Stairs are always just there. (I would love to have cross-ventilation - the stove and bathroom vents help a little though.)
That’s false. Home ownership rates in EU is 70%. US is also 65%, not 60%.
This is correct. It is much lower than that in Austria and Germany, but higher in other places. It seems to vary significantly by country. In Germany the majority rent.
I'd love to know more about the exact wording. I have had a pet theory for a long time that a significant percent of people just hear "paycheck to paycheck" as a kind of banal aphorism like "live one day at a time" or "workin' for the weekend" or something like that.
It's because Americans love to complain about how hard they have it, even when they don't.
While it's certainly true that the inflation of the last few years has hit my personal budget kind of hard, its not been bad enough to actually make me stop eating out all the time, buying Starbucks frequently, or spend less on clothes. I have been putting off a car purchase lately, but that is more about personal discipline than "I can't afford the payment".
I don't tend to whine and complain about prices like other people, but that might be because I'm a Democrat. If Trump were president now, I'd probably be joining in on the complaning.
One thing I've noticed online recently is that there is a hostility to the idea that individual financial decision making should matter at all. When people complain about the price of DoorDash or travel or some other luxury, the implication is that no one should ever be forced to consider a budget and make a more prudent decision (I say this as someone who probably eats out more than I should).
I wonder if this is partially due to the influence of social media, particularly Instagram - if you regularly see other people your own age enjoying these things, you feel in some sense entitled to them even if they're really not in your price range.
This seems particularly true of UMC types in high CoL cities who think their high paychecks should be going further than they do.
Yeah--like, the $18 avocado toast obviously isn't why the median American can't afford a 20% down payment on a house in San Jose, but if you're feeling strapped, you might want to take a minute thinking about your spending choices.
And further, so much of the app-based food delivery stuff feels like people are just on autopilot. I like junk as much as the next person, but you're paying $25 to have soggy, lukewarm McDonald's delivered on the regular? Why are you doing that? Does that even feel good?
"you're paying $25 to have soggy, lukewarm McDonald's delivered on the regular? Why are you doing that?"
This is what kills me about the use of food delivery services for things outside of pizza and a handful of other types of cuisine -- you are manifestly getting a substantially inferior food product at a dramatically higher price! If you have to eat at home and don't want to make the effort to cook, it's still surely better to just eat a sub-$1 Cup o' Noodles and some chips rather than blowing the equivalent of an hour or more's after-tax-wages to get food in a condition that you would refuse to accept if a server brought it to you in a restaurant.
I flat-out do not know these people. I think they must exist almost exclusively on Twitter.
Spend an hour in a medium- to large-sized apartment building lobby some time!
(full disclosure: I haven't *never* ordered something stupid for delivery, but there are clearly people doing it four days a week)
I have sat in a coffee shop and seen delivery app people come in for one fancy coffee drink! The delivery likely costs more than the drink. I hope they give a high percentage tip at least. Maybe someone is home with a sick kid or has agoraphobia or whatever, but I doubt that is most of it.
My son's roommate was going to order wings from a place IN THEIR SAME BUILDING to be delivered until the other guys in the apartment shamed him out of it. Granted, you have to go outside and walk a quarter of a block and it was winter in Chicago, but even so it was close enough to go out without a jacket or gloves and not be in danger of frostbite.
Huh. Well, they can go broke and die, I don't give a shit about them. <-- spicy viewpoint that the party should endorse!
For me the whole point in going out for lunch is to go OUT for lunch.
I want out of the damn office. I want to smell fresh air.
I have never ordered personal lunch delivery. Why???
Idk last time I went to McDonald's I saw several doordash delivery people there. I agree that it's absolutely wild to order delivery McDonalds, since it is easy to take kids there or drive-thru. I say that as someone who thinks food delivery is really incredibly luxurious, both in that I feel so fancy when I do it and I really really enjoy it.
It is pretty grim to sit in a mostly empty restaurant watching the Doordash people come and go. Why pay downtown rents if you're not even going to go outside!
uffda, this comment. 100% agreed
I do not know how common they are in the general population. I do know that other attorneys I work with sometimes will offhandedly mention getting non-traditional delivery food via some delivery service, so I presume it's not totally made up.
I'm sure they *do it*--I see my boss do the same sometimes--but does it reflect actual economic stress? My boss is a company founder and he's rich, he can do whatever he wants.
I have met them. They have no taste in food.
For us fancy restaurant DoorDash was partially a habit developed during COVID ("Yes it's an insane price and not as good, but we can't go out, so might as well order this") and now as a parent you're saving $35 an hour for a babysitter. It's definitely a worse product, but it's generally better than the alternative given limited time to cook.
Dave Ramsey became a multi-millionaire by telling people they need to make a budget.
I occasionally do fact finding with clients and whenever I get to the "what do you spend a month" question, it's always "I have no idea."
Ok, what's your monthly income from all sources? Are you saving any? No? Ok, are you going further in to debt? No? Ok, your spending is equal to your income then.
When people complain about the price of DoorDash, I think it’s less about the tradeoff between DoorDash and preparing your own food and more about how much more expensive DoorDash is than takeout.
Which is fair - when you account for increased menu prices, service fees, delivery fees, and tips, it’s a massive markup for a service that really doesn’t provide that much value other than avoiding the need to get off the couch and walk/bike/drive for 15 mins or so.
Of course why these people don’t just order takeout is unclear.
On the contrary, DoorDash provides a massive benefit. It is pretty to see that.
None of those restaurants offered delivery before DoorDash came along. Now people talk about having hundreds of options.
That's pretty clear indication that DoorDash is providing tons of value.
Not to mention they provide discovery of restaurants, online menus, online ordering, card payments.
Do people really not remember the old days when you'd call the pizza place and they'd answer but immediately put you on hold because there were four other customers also calling in? Then you ordered over the phone and had to repeat everything three three times to make sure they didn't mess up the order? And then they only took cash and god forbid you didn't have small enough bills for the driver to easily make change.
Lots of places offered takeout before DoorDash.
And they all still offer take out.
If you’re in an urban place, actually moving your car is a big barrier, and doing it on foot, bike, or public transit is a big chore, unless it’s on your block.
Big chore to walk or bike 10 mins? That's how long it usually takes unless you live in a giant and sprawling city.
Biking with takeout is a chore, and yes, 25 minutes of walking there, picking up the food, and walking back, is a chore.
I mean, you typically have the choice to eat your food there.
Yeah I wouldn’t usually do delivery or takeout from a place that close by - but during the pandemic I did, and I think some people might if they have some reason someone needs to eat at home (maybe a kid or a pressing work call or an injury or an important TV show to watch).
For what it’s worth I use it when I forgot my lunch. Doesn’t happen that often but I get 30 minutes for lunch and it has to also be the one time I get to go to the bathroom.
I mean at this point I usually am not really price sensitive. Just get me a burrito bowl and I’ll pay whatever you want but it’s pretty annoying that the vc subsidy for this went away and the price of making a small morning rush mistake went up 10 bucks. Not that any of this makes me feel poor that I sometimes have to overpay to get something vegan brought to my workplace.
or it's very clear!
The money I save picking up my takeout just goes to the beer I have while I'm waiting for my order.
lol holy heck, delivery food!
We never, and I mean literally never, got delivery food when I was growing up. Zero times in eighteen years. You want a pizza, you make it or you go pick it up. What's ten or fifteen minutes of your time?
Now pushing the age of 40, I think I've increased this lofty total to twice--I got a couple of delivery pizzas left on the front porch when I had late-2021 covid.
I mean, I think we never did as well (I'm early 40s), but literally the only place that delivered to us was Domino's Pizza. If you wanted anything else, you had to go pick it up from the restaurant. We never ate Domino's, so it's not really much of an achievement to have never had delivery.
Nowadays, I'm richer than my parents were at my age, and Deliveroo says that there are literally 433 pizza restaurants that will deliver to me.
Not 434. Bad economics. Thanks, Obama.
I live in the UK, so you'll need to blame the Tories on that one.
We sometimes get more than 2 deliveries a day lol. Should probably work on that.
Same experience. And I have only ordered delivery maybe 2-3x in the last 5-6 years when UberEats offered me a huge coupon but required delivery (and I still did the math to make sure I came out ahead).
Agreed. I think there is a broader trend of absolute disbelief in agency, combined with what I feel confident calling entitlement and a curse of comfort. Right and left, there is outright disbelief that we should be held responsible for our actions. The right blames adverse outcomes at the individual level on this mythical notion of 'elites' and whatever conspiracy theory is popular at the moment, and the left blames it on nebulous and specious notions of 'social structures' and the tenuous application of tenuously defined mental disorders. I frankly feel that we are collectively undeserving of the system our ancestors sacrificed to build. We are fragile, self indulgent, criminally comfortable, and profoundly unserious.
It has started to occur to me that the closer we get to utopia (the more easily we can see it), the farther we realize it is. Which is why I think there is such agitation over economic philosophy in a country as comfortable as ours.
That said, I may fit into the last part of your comment somewhat. I make $150-165k/yr and live in Manhattan. I pay a little under $4k for a 350 square foot apartment on the third floor of a building with no elevator or washer/dryer (and I get absolutely fucked on taxes). While I'm not living paycheck to paycheck, I certainly don't have a ton left over after I pay my expenses, and I think it would be a difficult to characterize my lifestyle as lavish. And for what it's worth I do not use social media or know/give a shit how my friends are living.
This seems somewhat relevant to my recent post, which I will shamelessly plug.
https://substack.com/@02tenon/p-150142787
Yeah, I do think there are unique situations like yours (and those situations are probably overrepresented in those who control The Discourse. That said, I'm guessing that living in Manhattan is a choice, made because of the substantial QoL it provides? Taking the tradeoff of a small apartment to live there is an example of the kind of lifestyle prioritization a lot of the biggest complainers argue shouldn't have to be made.
I think it’s very reasonable to expect to be able to afford to rent a small apartment in a good part of Manhattan and still save a solid amount per month on a 150k salary. And the fact that that is not the case is definitely indicative of a problem, although more one with Manhattan.
Yeah, absolutely, we need to build more housing and no city should be completely out of reach. But areas in demand will always have some element of scarcity that requires tradeoffs.
Oh for sure. Housing will always be expensive in New York. What you're saying applies, I think, to cities like DC or perhaps Boston where housing is very expensive but supply has more been able to keep up with demand. But New York, Manhattan in particular, is an example of extreme and deliberate supply suppression. If you walk through the most in demand neighborhoods here, so probably the most in demand and densely populated parts of the US, you will rarely find residential buildings that are above 5 stories (and they were usually built in the pre WWII era). It's to the point that unless you make 150, and probably even more, you have to make extreme tradeoffs that would be considered unreasonable anywhere else.
Yeah, I find it perplexing that people complain about how little their DoorDash driver makes, but also complain about the price of DoorDash.
Right wingers in the 80s who said people were rich if they could afford a microwave were actually correct all along.
I wasn't there--or I was only there in diapers--was this really a thing? I am fascinated.
I don't recall right wingers in the 80s saying people were "rich," per se. The issue, which certainly goes back to at least the 1980s, maybe earlier, are surveys that show fairly large percentages of people who report being below the poverty line also owning things that were unequivocally considered "luxuries" (or completely unavailable) not that many years earlier -- color TVs, microwaves, and air conditioning are the big three that I can think of.
(People today really don't appreciate the point that color TVs continued to be sold at a substantial premium for a long time after color broadcasting became common. This is a subtle point made in "Wonder Woman 1984" of all places. Watch the teaser trailer from 33 to 43 seconds: https://www.youtube.com/watch?v=sfM7_JLk-84&t=32s If you pay close attention, you'll notice that the wall of TVs showing Maxwell Lord's ad are framed with signage saying, "Watch in Vivid Color!" and TVs in the shop window with patriotic bunting are 27" color TVs being advertised for $749.95 -- that's the inflation-adjusted equivalent of about $2300 today according to the BLS CPI calculator.)
To some extent this goes back to my theory of everything regarding inflation--general electronics stuff (TVs, laptops, whatever) generally becomes cheaper per unit "goodness", and the population is generally used to this.
Unless somebody comes up with a more efficient chicken egg delivery and collection system, eggs *cannot* become quote-unquote "cheaper" (whatever their dollar amount).
Well, the answer is that people did come up with more efficient chicken/egg delivery and collection systems ("factory farming"), but we've hit the limits of that. To put it another way, William Baumol won't stop ****ing that chicken.
Of course, absolutely. But the SV-minded "the world is our oyster, and once we demonstrate a single improvement one time, it will reliably be a permanent improvement forever" viewpoint is wrong.
I know I changed topics.
Microwaves were expensive in the late 70s early 80s.
People even buy things without seeing the prices! I can’t fathom that idea.
Yeah, we get pizza or Indian delivered on occaision (two of the foods that actually hold up) but always scour the options available for discounts - you can easily find deals that essentially wipe out the cost of delivery if you're not picky.
Cutting your other spending to the bone would not actually solve the problem that the mortgage on an entry-level family home is 90% of your take-home pay. Even when the other 10% supports an excessive lifestyle by MCOL standards!
For one thing, you're a 10% pay cut away from default. You wanna bet that'll never happen over the life of a 30-year loan?
Maybe don't take on a mortgage that's 90% of your take home pay then? At some point people need to be held responsible for their financial decisions.
Right, this supposedly elite cohort is constrained by financial circumstances such that it would be unreasonable to hit normal middle class milestones, like buying an entry-level home for your young family. Which is exactly their point.
How could you even get a mortgage that's 90% of your take home without committing financial fraud?
Yes. That’s one way you get “I spend $3000/mo on DoorDash and I can’t afford to buy a house.” Thats a stupid amount of money for DoorDash, but it’s also irrelevant.
Yeah, but the specific scenario you're describing is really only applicable to a few superstar cities. We should build way more housing in those places (this is Slow Boring, after all) but if a mortgage would be 90% of your take home in Palo Alto, you can probably find a similar paying job in Pittsburgh or Milwaukee.
“The biggest problem with perpetuating this economic myth is that it can push people towards some wacky policy ideas, like dismantling capitalism or imposing blanket tariffs to restore some rose colored-vision of manufacturing in mid 20th century America.”
I really don’t think hardcore leftists and identitarians realize how much they’re helping to perpetuate the status quo by siphoning political attention and energy from more plausible reformist politics that focuses on improving material conditions for those who are genuinely deprived.
For people like that, their ideological identity would be threatened if they didn't project the belief that radical change is always necessary onto circumstances where it doesn't fit. (Damn you, Karl!) You saw that during the Obamacare debate; there was no shortage of "progressives" who'd rather let people die than see a CORPORATION make a PROFIT off their health care.
Resist, smash, overthrow, fight, against!! It's all about identity.
As the title of a Gramsci biography says, "To live is to resist". The results don't matter it seems, just the identity of being one who resists.