Jophiel wrote:
Kavekkk wrote:
If you own your house, sure. Food and appliances are both very cheap, rent is the main expense for low income people by far.
I was thinking the same and it's shades of the whole "poor people don't know how good they have it with their color televisions and microwave ovens" argument while they struggle to pay rent and keep the utilities connected (much less acquire a doctor's bill).
And that's not really true either though. Here's a
chart showing housing prices adjusted for inflation. It's risen a bit, but not that much, over the last century (maybe 20% higher today relatively speaking). Nominally, rents should be a function of housing costs (it's trickier getting adjusted rent figures), so differences in real relative costs have less to do with actual increases in costs, but in other factors.
One of the factors for overall relative housing costs is something like larger rental spaces. People don't rent the equivalent of a room with shared facilities anymore. That's going to affect any "average rent cost" calculation. Today, people expect rental units to come standard with things like electrical outlets, heat and often AC, a complete functioning kitchen, indoor plumbing, bathroom, etc. Call us victims of our own rising standard of living, but you can't ignore that as a factor.
Another huge factor is family makeup. I ran across some calculations that were looking at things like average incomes back in <insert old timey year here> and costs for various things (including housing) and comparing them to prices today (using the relative income levels to establish what relative costs of things
should be if we were as well off today as back then). Of course, the problem with that is "back then" most families consisted of a married couple with one income providing for the household, including the non-working mom. Today, there are many more single income single person "households", and many more single parent households, and many families consisting of two different people each earning a salary, and each supporting a separate household (with kids shared between them in some manner). And that's not counting people who are on public assistance and therefore count on the "housing cost" side of the equation, but not very much on the "average income" side. You obviously can't just peg income levels across the board from then to now. A single income back then was expected to support an entire family. Today? More like part of a family.
Obviously, we could debate whether rising costs of living relative to income drove more workers into the market, or other social factors first drove more workers into the market (like, you know, women), which drove down average income relative to living cost. And I'm not even saying that this isn't something we have to account for today. I'm just saying that it's overly simplistic to conclude that the solution to rising rents relative to average hourly wages is to just increase the wages, much less that a minimum wage increase would cause a significant change in that relative increase at all anyway.
Quote:
The issue is that the cost of voluntary (mainly electronic) consumer goods goes down as new stuff comes on the market but housing, energy costs, transportation, food, medical and other necessities tends to go up. Being able to acquire one isn't necessarily indicative of the ability to acquire the other.
Again though, we do tend to judge standard of living not just on whether one has a home, but the quality of that home. And we judge standard of living by what we can do in our leisure time as well. I mean, I suppose if we were living in some kind of Soviet style workers paradise, where all that matters is the cost to provide a standard issue dwelling, standard issue clothes, and standard issue food, and only in the precise amounts necessary for subsistence existence for all workers, we could make direct calculations of the average "wage" you'd need to pay (really cost to maintain your labor force at that point), and look at relative changes in those things.
But we (thankfully) don't live in that kind of society. And while I don't think the issue of housing costs is irrelevant, I also do think we need to take into other factors than just relative wages when looking at those costs. A group of 3 or 4 friends in their 20s sharing housing and living expenses are no less able to do so even while earning near minimum wage pay today than they were when we were that age (or when our parents were our age). Most of the scary stats are derived based on the false assumption that every single income earner must be a sole head of household. But that has *never* been the case, and is even less the case today.
Edited, Mar 22nd 2016 3:53pm by gbaji