Let's reduce economics to its barest rudiments: I'm pretty sure a worker could buy a house and support a family in 1950 on a single, average 40 hour a week salary; this was probably also true even as late as 1970. How many workers in the modern economy can buy a house and support a family on 1/4 of a 40 hour a week salary?
Those "productivity" numbers are obviously cooking the books bullshit. Either that or they're not measuring the right things. If the bare rudiments; food, housing, family creation cost the same or more, but we claim productivity has increased because ... I dunno we can sit on our fat asses and watch netflix instead of going to a movie theater: that's not measuring the right things.
Edit add: even assuming all the productivity gains have only benefitted, say, the top 10%, you'd see more people who could buy a house and make a family working 10 hours a week.
In 1950 the average new home was 983 square feet and the average household 3.8 people. Today it's 2500 square feet and 2.6 people. That's a 270% increase in home space per person.
And that doesn't even get into all the other ways that modern housing is fancier. Central A/C, attached garages, swimming pools, high ceilings, granite countertops, finished basements, more bathrooms, massively decreased fire risk, higher capacity electrical circuits, improved water heaters, builtin appliances.
Median home price in the US is $123/square foot. To house a family of four, under 1950s standards costs about $125,000 in America today. That's easily affordable to a single earner at the median full-time wage of $45,000/year.
I'm not saying that housing policy doesn't artificially inflate the price of housing. There are many easy reforms that would drastically increase affordability. Especially in high-priced metros. But to pretend like people in 1950 had it easier than today is just ignorant of the historical facts.
That salary price is nowhere near the minimum wage in the US. $45,000 is around $21.63/hr. Although most places pay more than minimum wage, the current federal minimum wage is $7.25/hr.
Also, you'll be hard pressed to find a livable house for that cheap. The average price of a home in the US in 2019 is $226,800 [2].
The numbers just don't work. Most people can't afford a house right now.
> The average price of a home in the US in 2019 is $226,800
Yes, because the average home in America is 2000+ square feet.
The OP explicitly made the comparison to 1950. And in 1950 the average home was 980 square feet. It'd be like me complaining that cars have become unaffordable because I decided to double the number of cars that my household owns.
You can easily find a 1950s size home for less than $125,000 almost anywhere in America. For example check out the Zillow listings for Omaha, Nebraska. There's a plethora of 2 bedroom/1 bathroom homes (typical 1950 sized house) priced around $100,000. (Many actually built in the 1950s.)
Omaha has the third lowest unemployment rate in the country, and Nebraska's educational system is ranked above average. If your benchmark is 1950, which entails a four-person family, a 1000 square foot house, a job, and decent schools, that's easily achievable today, unless you insist on living in a high cost metro like New York, San Francisco or Miami.
> Although most places pay more than minimum wage, the current federal minimum wage is $7.25/hr.
Only 2% of full-time workers make less than minimum wage. And of those ones that do the vast majority are under-25. Not exactly the typical 1950 head-of-household. You're trying to compare the poorest segment today to the upper-middle of 1950. You can't compare advertising executives from Mad Men to modern-day dishwashers, then declare that things have gone backwards.
If you do want to look at the poorest Americans, instead of the middle-class, then 1950 looks even more bleak. 25% of homes didn't have full plumbing. 15% didn't have a toilet. 20% didn't have electricity. A third of were heated with coal (which is filthy, unreliable and terrible for the respiratory system).
Without a doubt the bottom quartile of Americans had much much worse housing conditions in 1950 than today.
It's not a technological problem, it's a political problem. We could have automated things like solar energy production in the early 80s but the powers that be said no. We could have done similar things with mass transit, or organic farming, or wireless telecommunications, but that top 10% with all the money kept saying no. So here we are decades later still paying for the long term costs of technical debt in our economy.
The fallacy is looking at the sticker price of homes without considering the externalities. Planning and zoning put homes too far away from workplaces. Houses are still built of wood 2x4s instead of recycled materials. Heck, we still build homes mostly by hand. Not to mention that land prices are hyper inflated due to the age old power imbalance between land owners and plebeians.
We're basically living in the 1999 economy from the Matrix movies 20 years later. I think it's either going to take a mainstream movement towards some of the democratic socialism ideas from Europe or organizing on a mass scale to solve these problems. Unfortunately politicians and the elite will do everything in their power to stop real progress like that, until (like with solar) it becomes cheap enough that it can be rolled out without government incentives.
I don't disagree with you there are political problems, but this is a measurement problem.
>The fallacy is looking at the sticker price of homes without considering the externalities.
If productivity had truly quadrupled since 1950, it doesn't matter what the externalities of homes are; not even the fact that they're still made by hand. If it takes X worth of labor and materials to build a house at t0 and t1 and societal productivity has gone from y to 4y between t0 and t1, there should be some large fraction of the population at t1 who can afford a house on 1/4 of t0 hours. There isn't. You can't even say that modern houses are better in any sense than 1950s houses; they mostly are not (energy efficiency maybe; even that is dubious).
I think the thing we have to come to accept as a society is that productivity and efficiency increases are a mirage.
Those "productivity" numbers are obviously cooking the books bullshit. Either that or they're not measuring the right things. If the bare rudiments; food, housing, family creation cost the same or more, but we claim productivity has increased because ... I dunno we can sit on our fat asses and watch netflix instead of going to a movie theater: that's not measuring the right things.
Edit add: even assuming all the productivity gains have only benefitted, say, the top 10%, you'd see more people who could buy a house and make a family working 10 hours a week.