Piketty's Crumbs

In Piketty's Crumbs, Tim Kane argues that poorer Americas are actually doing very well, contrary to the view that they've advanced little over the past century, expressed as follows by Piketty:

“The poorer half of the population are as poor today as they were in the past, with barely 5 percent of total wealth in 2010, just as in 1910. Basically, all the middle class managed to get its hands on was a few crumbs.”

Kane observes that middle class life has greatly improved:

Have we nothing but crumbs to show for a century of capitalism?

One way to value the progress enjoyed by everyday people is to imagine having to do without all of the material things we have that our ancestors lacked. How much money would you be willing to accept to give up indoor plumbing for a year? Having water on tap in every home in 2010 offers us no point of comparison to 1910. The current crisis of toxic tap water in Flint, Michigan has caused an uproar, but it’s in part a story that shows how much we take clean tap water for granted. Most homes have five or more taps between the kitchen, bathroom sinks, shower, and washing machine. The cost of tap water across the United States is roughly half a penny per gallon, which is surely far less than the actual value we get from it. But few homes in 1910 had any taps. Treating water with chlorine to cleanse it of toxins was first done in 1908.

How much money would you demand to give up modern public goods such as highways or emergency fire and ambulance services? How much is air conditioning worth to you? What about penicillin? Entertainment of any kind that is not live? The ability to travel to Australia from Minneapolis in a day’s time for the price of five men’s suits? Recorded music, movies, and cable television? How much would you have to be paid to surrender the Internet for a month? No Facebook. No Netflix. No email. No Google searches. No Google Maps.

These are Piketty’s crumbs. Here are some others. ...
To be sure, the flaw in inequality accounting is not Piketty’s alone. It is fundamental to microeconomic analysis. So much of what makes life worth living cannot be measured in dollars. The point is that if those things could be measured, they would probably show how much richer everyone has become.
- Tim Kane, Piketty's Crumbs, Commentary, April 14, 2016

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