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The Future: Back to the Past
Posted By Don Boudreaux On November 26, 2012 @ 7:50 pm In Myths and Fallacies,Standard of Living | Comments Disabled
To be precise, back to 1956.
Lately, I’ve encountered with unusual frequency claims that the 1950s were a glorious economic time for America’s middle-class  – a time so glorious, what with strong labor unions and high (above 90%!) marginal income-tax rates  and all, that we middle-class Americans of today should look back with longing and envy on those marvelous years of six decades ago.
So on Saturday I bought on eBay this Fall/Winter 1956 Sears catalog . I spent an extra $8-and-change to have it shipped to me overnight – a service that I could not have purchased in 1956. My catalog arrived on my doorstep today. I’m eager to explore it and to report my findings with some thoroughness.
But to give you a taste now, below is a sample of what I plan to do.
Having on hand information on the nominal average hourly earnings of nonsupervisory nonfarm private production workers in the U.S. in 2012  - that figure being $19.79 (as of October 2012) - I searched for the same earnings figure for 1956. Thus far I’ve had no luck finding that number. (Please feel free, I bleg of you, to help me find this figure, if you so desire.) So, for 1956 I instead use average hourly manufacturing earnings of production workers, as reported in Table 1 here . That figure is $1.89.
This nominal wage figure for 1956 isn’t exactly comparable to the nominal wage figure that I use for 2012, but it’s close enough, at least for this first-pass analysis. If the claim of many “Progressives” is true that manufacturing is the most princely sort of work that middle-class Americans can do, then presumably this figure of $1.89 is higher than the hourly earnings of all private, nonfarm nonsupervisory workers in 1956. Anyway….
So let’s ask: how long did a typical American worker have to toil in 1956 to buy a particular sort of good compared to how long a similarly typical American worker today must toil to buy that same (or similar) sort of good? Here are four familiar items: refrigerator-freezers; kitchen ranges; televisions; and automatic washers.
Sears’s lowest-priced no-frost refrigerator-freezer in 1956 had 9.6 cubic feet, in total, of space. It sold for $219.95 (in 1956-dollar prices). (You can find a lovely black-and-white photograph of this mid-’50s fridge on page 1036 of the 1956 Sears catalog.) Home Depot today sells a 10 cubic-foot no-frost refrigerator-freezer for $298.00 (in 2012-dollar prices). (You can find it in color on line here .)
Therefore, the typical American worker in 1956 had to work a total of 219.95/1.89 hours to buy that 9.6 cubic-foot fridge – or a total of 116 hours. (I round to the nearest whole number.) Today, to buy a similar no-frost refrigerator-freezer, the typical American worker must work a total of 298.00/19.79 hours – or 15 hours. That is, to buy basic household refrigeration and freezing, today’s worker must spend only 13 percent of the time that his counterpart in 1956 had to spend.
Sears’s lowest-priced 30″ four-burner electric range, with bottom oven, was priced, in 1956, at $129.95. (You can find this range on page 1049 of the 1956 Sears catalog.) Home Depot sells a 30″ four-burner electric range, with bottom oven, today for $348.00 .
The typical American manufacturing worker in 1956, therefore, had to work 129.95/1.89 – or 69 hours – to buy an ordinary kitchen range. His or her counterpart today must work 348.00/19.79 – or 18 – hours to buy the same sized ordinary range.
Sears’s lowest-priced television in 1956 was a black-and-white (of course) 17″ model. (You can find it on page 1018 of the 1956 catalog.) That t.v. set was priced at $114.95. Sears today sells no 17″ t.v. sets. The closest set I could find at Sears was this 19″ color (of course) model , which is priced at $194.00.
The typical American manufacturing worker in 1956, therefore, had to work 114.95/1.89 – or 61 hours – to buy this tiny black-and-white (with no remote!) television set. His or her counterpart today must work 194.00/19.79 – or 10 – hours to buy a slightly larger, high-def, color (with remote!) television set.
Automatic Washing Machines
Sears’s lowest-priced automatic washer – it could handle loads up to a maximum of 8 lbs. – sold in 1956 for $149.95. (You can find it on page 1029 of Sears’s 1956 catalog.) Today, Sears’s lowest-priced washer sells for $299.99 . (It’s got 3.4 cubic feet of wash-bin space; I can’t find a maximum “pound-load” for it. Presumably, this 2012 washer isn’t significantly smaller than – and might well be significantly larger than – the low-priced 1956 model.)
The typical American manufacturing worker in 1956, therefore, had to work 149.95/1.89 – or 79 hours – to buy an ‘inexpensive’ new washing machine. His or her counterpart today must work 299.99/19.79 – or 15 – hours to buy an inexpensive new washing machine.
(Bonus point: Because the lowest marginal personal-income-tax rate imposed by Uncle Sam in the 1950s was significantly higher than it is today, hourly middle-class earnings today go even farther, for individual earners, than they did six decades ago.)
In the above I don’t adjust for quality – yet it is certainly true what they say: “They don’t make ‘em like they used to.” They make ‘em better. So the real-price reductions for these above four items are even larger than indicated above.
In follow-up posts I’ll go into more detail, using my lovely Fall/Winter 1956 Sears catalog, to gain further insight to how middle-class Americans’ economic fortunes today compare to what those fortunes were in 1956. I am well-aware that no such ‘catalog’ analysis covers all fronts or can possibly tell a complete picture. Yet I also firmly believe that such analysis does convey very useful information.
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URL to article: http://cafehayek.com/2012/11/the-future-back-to-the-past.html
URLs in this post:
 claims that the 1950s were a glorious economic time for America’s middle-class: http://www.nytimes.com/2012/11/19/opinion/krugman-the-twinkie-manifesto.html?partner=rssnyt&emc=rss
 high (above 90%!) marginal income-tax rates: http://www.ntu.org/tax-basics/history-of-federal-individual-1.html
 this Fall/Winter 1956 Sears catalog: http://www.ebay.com/itm/Vintage-1956-FALL-WINTER-Sears-Roebuck-Catalog-Book-1508-Pages-Order-Form-/380518579045?pt=LH_DefaultDomain_0&hash=item5898acbb65&autorefresh=true#payId
 nominal average hourly earnings of nonsupervisory nonfarm private production workers in the U.S. in 2012: http://www.bls.gov/news.release/empsit.t24.htm
 Table 1 here: http://digitalcommons.ilr.cornell.edu/cgi/viewcontent.cgi?article=1237&context=key_workplace&sei-redir=1&referer=http%3A%2F%2Fwww.google.com%2Furl%3Fsa%3Dt%26rct%3Dj%26q%3D%2522average%2520hourly%2520earnings%2522%2520private%2520nonsupervisory%25201956%26source%3Dweb%26cd%3D5%26ved%3D0CEEQFjAE%26url%3Dhttp%253A%252F%252Fdigitalcommons.ilr.cornell.edu%252Fcgi%252Fviewcontent.cgi%253Farticle%253D1237%2526context%253Dkey_workplace%26ei%3Dzt-zULGHLs6qqAHql4CgDA%26usg%3DAFQjCNGDTSbtPqdSSNWh13QfvReOv5gsHA%26sig2%3DUpIQLmU5roRYh8lDN8rNHQ#search=%22average%20hourly%20earnings%20private%20nonsupervisory%201956%22
 here: http://www.homedepot.com/webapp/wcs/stores/servlet/ProductDisplay?storeId=10051&langId=-1&catalogId=10053&productId=203425195&R=203425195#.ULQHBWBxsVk
 Home Depot sells a 30″ four-burner electric range, with bottom oven, today for $348.00: http://www.homedepot.com/h_d1/N-25ecodZ5yc1v/R-100664969/h_d2/ProductDisplay?catalogId=10053&langId=-1&keyword=30%22+electric+range&storeId=10051#.ULQIhGBxsVl
 this 19″ color (of course) model: http://www.sears.com/sceptre-x195bv-hd-19-inch-class-television-720p/p-05711736000P?prdNo=3&blockNo=3&blockType=G3
 Sears’s lowest-priced washer sells for $299.99: http://www.sears.com/kenmore-3.4-cubic-foot-top-load-washing-machine/p-02621102000P?prdNo=1&blockNo=1&blockType=G1
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