In his column this morning David Brooks tells a story about changing values with this example:
For example, imagine a man we’ll call Sam, who was born in 1900 and died in 1974. Sam entered a world of iceboxes, horse-drawn buggies and, commonly, outhouses. He died in a world of air-conditioning, Chevy Camaros and Moon landings. His life was defined by dramatic material changes, and Sam worked feverishly hard to build a company that sold brake systems. Sam wasn’t the most refined person, but he understood that if he wanted to create a secure life for his family he had to create wealth.
Sam’s grandson, Jared, was born in 1978. Jared wasn’t really drawn to the brake-systems business, which was withering in America. He works at a company that organizes conferences. He brings together fascinating speakers for lifelong learning. He writes a blog on modern art and takes his family on vacations that are more daring and exciting than any Sam experienced.
Jared lives a much more intellectually diverse life than Sam. He loves Facebook, YouTube, Wikipedia and his iPhone apps. But many of these things are produced outside the conventional monetized economy. Most of the products are produced by people working for free. They cost nothing to consume.
I have some problems with his story. For one thing I don’t believe that there are enough Sams and Jareds to effect the sorts of changes we’re seeing. Consider: in all likelihood Sam would have had his children between 1920 and 1945 and they, in turn, would have had theirs between 1940 (at the earliest) and 1990 (at the latest). My point is that Jared (on average) is probably too young to be Sam’s grandson.
For another Jared is too old to be in the primary demographic for Facebook. The median age of Facebook users is under 24 and very much the same is true for Twitter.
For another thing his story has a notable hole in it. What about Sam’s son, Frank, born in 1940?
Let me make a few revisions to his story to bring it more into accord with reality. Let’s imagine that Sam was born in 1925, Frank was born in 1955, and Jared was born in 1985. The biographies are about the same except for this difference: Jared is either unemployed or underemployed and, as you can see from the chart above, is pretty likely to be living with Frank and his wife. It’s only by Frank and his wife’s work that Jared is able to maintain his lifestyle.
Now Jared’s “more intellectually diverse” life is not precisely Hannah Arendt’s life of the mind but dwelling too much on that would just be petty of my me. Who am I to judge?
However, I’m genuinely concerned about what will happen to Jared when Frank or his wife dies. Frank is pushing 60. If he’s anything like the rest of his age cohort he probably hasn’t saved enough and he got killed in the collapses of the dot-com bubble and the housing bubble. His 401K isn’t worth what he thought it was going to be and his house isn’t worth what he thought it was going to be.
What Mr. Brooks’s story sounds like to me is Thorstein Veblen’s Theory of the Leisure Class but with conspicuous consumption and conspicuous leisure replaced by conspicuous idleness.
Why do you put so much stock in a half-assed economist? What is conspicuous consumption? It is a term with no precise meaning. I could say that golf if conspicuous consumption/leisure, or hiking, skiing, or watching a play. What do all of these things have in common? I don’t want to do any of them…thus they have little value…to me, but what the Hell I’ll say they are examples of conspicuous consumption and thus make it harder for people who do enjoy such leisure activities from defending them as worth while.
I’m not endorsing Veblen in this post—I’m just suggesting that Brooks seems to be rehashing him. I think that Brooks has confused hanging around on street corners pitching pennies with signs of an affluent society.
Let me also provide another explanation for the graph than some reference to a old dead white dude from the first quarter of the last century….
Lets see, the percentage for living at home changed trend around 2003….what do we know was going on then? Housing bubble…rapidly rising housing prices? What a shock, more people felt they couldn’t afford to live on their own and instead opted to live with the parental units. Then in 2008 the bubble bursts and the economy tanks…people lose jobs, face economic uncertainty and more people decide to move in with good ol’ Mom & Dad. Seriously, look at the graph it practically explains itself. As home ownership rate rises living with parents declines. We don’t have to appeal to some notion that generation Y has lost the will to work or strike out on their own.
My old history of economic thought professor covered Veblen and the other old “institutional economists” and his parting quip before moving on was that if anyone in the course had, based on his lecture, decided to pursue a career in economics in institutional economics he couldn’t have done them more damage than if he had run them down with his car while they were walking in a cross walk. But some of Veblen’s ideas sure made for amusing discussion.
“Status Display” is a universal in human cultures – it maps imperfectly to “conspicuous consumption” and .. well anything can be “utility”. That’s the economists trick
Well, it’s always a concern when I find myself agreeing with David Brooks. But this is pretty much what I was saying a few weeks ago in another comment thread. The materialist drive is petering out, people crave “stuff” less, and they value Facebook friends over the latest hot item of shoeware.
No idea what this will mean for our future or the economy — aside from the fact that no one seems to see jobs in the future — but I think Brooks has the zeitgeist right.
(I apologize for the use of the word zeitgeist. No time to search out less obnoxious synonyms.)
Sure status display might be real, but you don’t get Veblen do you. It is a complete waste. Consider an animal that puts on a display to attract a suitable mate…is that a waste?
If a person walks into a meeting looking like a slob in a cheap suit and badly groomed people will have a very different reaction than if he comes in wearing a nice suit and well groomed. While both suits serve the same functional purpose the latter suit will likely serve its owner/wearer better.
The idea that there is some universal Truth as to what is wasteful strikes me as a foolish endeavor. And if someone wants to waster their money and or time, why should I be bothered by it if it has little or no effect on me?
Michael,
As someone who has invested a fair amount of time in online pursuits (many…ahem older…people might consider it even conspicuous leisure which would be truly weird in that I don’t do it where people can see and those who can see it–i.e. those online–don’t know who I am) I don’t think you know what you are talking about. People who do that kind of stuff still value stuff in the real world…which is why personal consumption expenditures still account for the greatest share of GDP. Granted it is less than a couple of years ago, but you’ll have to disentangle the effects of a severe economic recession before you can claim any actual evidence for your position. I haven’t stopped wanting to have nice new things simply because I’ve gotten a few online friends.
I think Frank should feel lucky he was overlooked by David Brooks since Brooks seems pretty condescending to both his father and son.
What I see with kids, a term which encompasses an older group each year, is that they want both money and the Facebook/Twitter friends. It looks to me as though they often struggle with how to balance things. Sometimes work suffers.
Steve
FWIW/ I think Brooks might get the timeline a bit better if he had moved Sam’s birth to around 1910. That puts him in place to perhaps delay marriage and childbirth during the Great Depression and WWII era, and then perhaps his children are more likely to delay marriage and childbirth due to college and other social changes. My grandfathers were born in 1908/1909, and my father in 1938, and I have a sister born in 1976.
I don’t believe my grandfathers lived less daring, exciting or intellectually stimulating lives. And if Brooks thinks the typical child of the 70s is vacationing in Cambodia and living the life of the mind, he’s got to get out more.
Heh. I’m thinking of a line from a well known song by Sly Stone. Oh yeah, “…different strokes for different folks….”
Sometimes overthinking it creates false precision.
Steve V:
I’m predicting the future, dude. You won’t see it in stats yet, you’ll see it in five years and think, “Wow, Reynolds really is a prophet.” (Which is what a small but growing slice of the publishing industry is now saying.)
Like all great prophets my fiery chariot will arrive and carry me up to the right hand of God. If by “chariot” we mean Bentley convertible*, and if by “God” we mean a home on the beach in Malibu.
*Drew, don’t give me any sh*t about wanting a Bentley: I have kids and need a back seat.
I’d say that that minimun wage has gone up a dollar two since the 70’s, but rental housing , even in as small as place as where I live, has tripled. I left my mother’s house at 19 for a $150 studio. The same apartment even here, would run about $500.
To be honest I read Veblin as Maslow. It had been a long day.
Changing values? I suppose so. I could easily go out right now and get a high five-figure government contracting position which would essentially double our family income. Instead, I choose to work part-time and only pull in less than 10k a year (the wife makes about $75k). Why? The main reason is that we don’t need the extra money. I would rather have the opportunity to walk my kids to and from school everyday, raise my new baby in my own home and allow my family to engage in more leisure activity and a have an overall better quality of life. I personally don’t think it makes much sense to outsource much of my parenting responsibilities (and the expense there would be substantial) in order to make more money to spend on crap I don’t need.
Or a complete fool. In forecasting you are rarely “spot on”. In forecasting if you get “close” you consider it a victory. And if you have no current “data” then you aren’t forecasting your are speculating–i.e. guessing and with nothing to back it up.
My how…conspicuous of you. Admit it you walked into that one. I think your fiery chariot should be a fire engine red Yugo. :p
By the way speaking of conspicuous consumption for all the Veblen fans out there….how many of you fools did anything on Valentine’s Day? C’mon don’t be shy raise your hands (or just post admitting your guilt) that you engaged in a completely wasted “status display”. You complete nattering nincompoops!
By the way I stumbled across a rather humorous take down of Veblen by H. L. Mencken yesterday. Mencken noted how Veblen was wondering why we like to have lawns. After all, what purpose do they serve. Well Veblen then came up with an answer to his own question using the relatively new field of evolutionary biology! Lawns serve the purpose of reminding us of our Australopithecus sediba days when we were wandering around on the African savanna and all that wonderful grass. Veblen then went to wonder why people hire gardeners to maintain their lawn when having a couple of cows would be oh so much more efficient. The cows would keep the grass clipped short (so we wont have any Australopithecus sedibian nightmares about saber toothed cats hiding in the tall grass) and they’d provide milk and meat. Again Veblen answered his own question: why to show off their status. See I’m so rich I don’t need a couple of cows I can hire Italians or Slavs (apparently the day laborers of Veblen’s time) to maintain my savanna like lawn.
Nevermind that the actual reason that people may prefer gardeners to cows is that gardeners wont shit on your front yard. You wont have to smell that rich and fecund smell of cow crap wafting in through your front window. Nor will you have to worry about getting a shoe full of cow shit if you decide to stroll around you front savanna….err yard. And lets not mention all the flies that you can avoid as well.
Yes, that Thorstein Veblen…a man of keen insights (btw, if memory serves he did grow up on a farm, so he should know about the draw backs of using a cow to mow your lawn…but maybe he liked have his shoes full of shit, after all so were his theories).
I think you want antelope for that. Maybe harder to keep in the yard.
Steve:
And yet, without data I predicted with surprising accuracy the current state of the publishing industry, did it almost 5 years ago, and did it when everyone was responding that I had “no data.” Not only predicted what would happen, but predicted the adaptations.
Not all prediction is extrapolation from data. And it wasn’t mere speculation, it was an understanding of what would necessarily evolve. I understood the business, got the technology, and knew how the content could work.
Here, I’ll give you some free Karnak: 5 years from now Amazon — or possibly BN.com — will be the largest book publisher in the US. (Not retailer: publisher.) At least 2 of the big 6 will be out of the book biz entirely. Costco and Wal-Mart will be out of the book retail biz. (Note that at present this is still, I believe, a growth area for them.) A third of all books (by established authors, not wanna-bes) will be self-pubbed e-book originals and the average price will be below $5. Also we’ll see widespread closures of public libraries.