Living Like Last Year

As time progresses forward we become better at nearly everything. Certainly in the realm of production and efficiency. So much so, that in the 1930 John Maynard Keynes predicted in “Economic Possibilities For Our Grandchildren” that by now we’d all be working just 15 hour work weeks.

As an example of the concept of things becoming less expensive over time, consider the fact that illumination has reduced in cost some 500,000% over a few centuries. Nobel prize winning economist William Nordhaus quantified this in his research where he showed that the means by which light was obtained progressed from fires from wood to plant based oils to candles to better candles to whale oil to petroleum based oil to lightbulbs to better lightbulbs to LEDs to better LEDs. Each step along this process slashed the cost further and further. Light is so cheap these days we rarely go to the effort of flipping off the lights when we leave a room. Whereas not too long ago a major percentage of a family’s time was spent gathering the resources to produce light.

Enhanced farming techniques now produce multiples of the food output per acre, per farmer, or per capita. This is due to many breakthroughs, but particularly due to the discovery of the Haber-Bosch process to create cheap and abundant nitrogen fertilizers.

The same can be said of computers, transportation, communications, heating and cooling, food production, media, medical technology, — you name it, it’s better, cheaper and more abundant and available. Things have progressed so much that one can’t help but think that Keynes was too pessimistic and we should be able to get by on just 4 hours of effort. But clearly, none of it has happened. Why not?

The answer lies in the fact that as all these things become easier and cheaper and better, we haven’t held everything else constant. In other words, had Keynes grandson lived in Keynes house and drove his car and took his vacations and lived the same lifestyle in every way possible, he probably could have cut back his workweek pretty far. -But the chicks wouldn’t dig him. He’d be that weirdo with no HVAC and just one beater automobile and who never goes to Fiji or Disneyland.

In 1950 the square footage of the average American house was about 1000. Today the average is 2600 square feet. And this is while the average household size has gotten smaller. In 1960 the average home had 3.33 people and today it is just 2.53. In Keynes’s time a home had no air conditioning, one bathroom (maybe), poor insulation, 7’ ceilings, no smoke detectors, poor lighting, no dishwasher, no washer and dryer, and no garbage disposal. It’s clearly apples and oranges.

Parkinson’s law is that “work tends to expand to fill up the time allowed to do the work”. Or in other words, inefficiency, waste, non-work, fill the time allowed to do the work where the time is more than is actually needed to do the work. Similarly, the upside benefits of technological improvements and reductions in costs are fully consumed in the expansions of our lifestyles and appetites up to what we can swing with full time employment (and consumer debt).

I often read articles about how these smiling expats ditch the U.S and take their 1500 dollars a month in savings or social security and beat the system in Ecuador or Mexico or Thailand. But for the most part, the difference in cost is only in the fact that they went where the American standard of living isn’t expected and never was. They’ve gone back in time to Keynes’s 1930’s house and they’re marveling at it’s meager price. But here’s the thing, one doesn’t have to stamp their passport to walk-back their lifestyle. A small house in nearly any place in fly-over country in the U.S is very inexpensive. I believe many of the expats are able to live an inexpensive life in these far off locales simply because everyone else there lives that way and there is no pressure to do otherwise.

We can all reduce our work-week (or increase our savings rate) if we don’t precisely keep up with the times. If we can live a half a step behind the culture. While still living well. Let go of the idea that you have to have the latest gadget, or newest car. Let go of the idea that you need to match the mores of the present time. Be happy with the cell phone of three years ago. Appreciate the car with no cup holders or the house with no dishwasher.

It is only choices. If one wants to live large he can do so. If one wants to work less she can do so. It can be done by adhering to a handful of aspects of the lifestyle of just a few years ago. Or the expectations and consumption levels of Ireland or Montenegro today. It can be done by ignoring some of the tastes of the times and living like last year.

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Gene Grindle

Engineer. Dad. Nerd. Interested Economics, Politics, Technology, Poetry, Culinary, Writing, Gardening, Leisure, & Homesteading (at least the idea of it).