Walmart shoppers on Black Friday. (CC 2.0.)
For the past few days, one of the most popular stories on the New York Times website has been Graham Hill’s op-ed “Living With Less. A Lot Less.” In a majestic display of guileless narcissism, Hill, an Internet multimillionaire, congratulates himself for downsizing his life and getting rid of all the stuff—the homes and cars and gadgets and sectional sofas and $300 sunglasses—he accumulated over the past decade. Now he lives in a 420-square-foot studio and has only six dress shirts and “10 shallow bowls” that he uses “for salads and main dishes.” Imagine that. Eating off the same plate. Twice. In one meal.
There are too many phrases to mock (“Olga, an Andorran beauty”; “My space is small. My life is big.”), and the Internet has already done a great job pointing out how obnoxious it is for a multimillionaire to hold himself up as a model of moderation when so many Americans are being forcibly downsized from already cramped lives.
But let me make one serious point—because scrubbed of its irritating tone, Hill’s cautionary tale is a familiar one that both the left and right like to tell to slightly different effects. It’s the moralizing force, for example, behind the appeal of Annie Leonard’s viral video “The Story of Stuff,” A&E’s hit show Hoarders, Lauren Greenfield’s documentary The Queen of Versailles and Glenn Beck’s theory of the 2008 economic crash: Americans are spending more and more of their money on stuff! Oh no! The left attributes this trend to advertising and corporate consumerism; the right blames individual choices and cultural decline. But either way, it is taken as gospel that Americans are spending increasingly untenable amounts of money on stuff and this is what’s making us (as households and as a nation) both bankrupt and unhappy.
This may feel true, but the economic data from the past half century tell a different story. As Elizabeth Warren and Amelia Warren Tyagi persuasively document in The Two Income Trap, Americans are not going broke buying clothes, books, music, furniture, cars, appliances and other consumer goods. Rampant consumer spending is not the source of their increasingly precarious lives. They call this mistaken narrative “the myth of overspending.” In fact, the share of income we spend in those categories has dramatically declined. For example, in 1949, the average American household spent 11.7 percent of its annual budget on clothes; today it spends just 3.6 percent. By the early 2000s, when Warren and Tyagi wrote their book, American households were spending 44 percent less on major appliances, 30 percent less on furniture and 20 percent less per car than they did just a generation ago in the late 1970s.