Keeping The Recession In Perspective

You hear a lot of complaining about how Americans’ living standards are declining as a result a result of the recession.  Some people go so far as saying the decline is probably permanent:  never again will Americans live as well as we have over the past two decades.  They could be right.  Others say our standard of living has been declining steadily since the failure of the Breton Woods agreement in the 1970’s, and they could be right.

There’s no doubt things are getting worse.  Personally, I’m of the opinion that the economy will recover and things will improve, perhaps even better than before.  But even if they don’t, even if today’s slightly-lower standard of living is permanent, it’s important to keep things in perspective.

1. As an American, you are vastly richer than over 50% of the world’s population, regardless of your income. Even the poorest of the poor in this country are very wealthy by global standards.  In America, “poor” simply means you don’t own 2 color televisions with 20 different sports channels.
2. You have more than you need to survive – Sure, owning your own home is nice, but it’s completely unnecessary to survive.  Ditto for high-speed internet, designer jeans, air condition, and bottled water.  Even the homeless in America live well by global standards:  at least they aren’t forced to starve.
3. Real poverty doesn’t exist in the west – There is a huge difference between relative poverty and absolute poverty.  People often use the word “poverty” to refer to Americans with low incomes and few material possessions relative to their neighbors.  This is known as relative poverty.  The problem, of course, is that these people are only “poor” relative to their rich neighbors!  That is, they aren’t really poor at all by any absolute standard.  Absolute poverty, in contrast, refers to a standard of living below that which is necessary to sustain life.  That is, those in absolute poverty are in real danger of dying tomorrow either through starvation, violence, or lack of shelter.  Absolute poverty hasn’t existed in America for over 100 years.
4. The average American today lives better than the richest kings of 500 years ago – Technological progress over the last few centuries has been truly astounding.  Today, the average American enjoys luxuries the richest and most powerful monarchs of the past couldn’t even comprehend.  Louis XVI never had central air conditioning or electricity.  He sweated just like everybody else.

So before you complain remember:  you still have it pretty easy.