Additions, Stability, and Prosperity

A good way to keep track of financial conditions in mid-century America is to start from the knowledge that the percentage of people below the  poverty level was 49% in 1940 and 40% in 1949. This would be the end of the Great Depression, to the early years of the Baby Boom.  Prosperity did not start immediately after the war. There were not enough housing and jobs for the returning soldiers and sailors - women had a lot of them, and until they married and their husbands found work they would be foolish to leave them. Therefore rents were higher and wages were lower. This gradually improved because there were lots of men with high confidence and maturity who were willing to do things for themselves, having just done something for the rest of us, and women who had both more skills and more confidence, combined with a desire to get married and have what was considered a stable, normal, life.  

People my age immediately mentally fit their own childhoods and their parents into this.  To a lesser extent we consider our grandparents' experiences. Yet in both cases, we know much more about how those stories ended than how they began. We are fairly automatic in comparing those national norms to the families in our towns and neighborhoods, and perhaps our cousins as well. Yet even when we were there, we don't get the full picture.  As Garrison Keillor once wisely pointed out in his story "Hog Slaughter," we believe times were simpler then because we were children, and our needs were looked after by others.  But it wasn't simpler for those others, not a bit. 

There is a lot of online complaining these days of how easy the Boomers and Greatest Generation had it financially when one compares it to today. House prices look so low! Well, yes, but lots of people lived in apartments, mobile homes, and even boarding houses and tenements, remember?  If houses were so cheap  and wages were so comparatively good, why didn't everyone have one? Housing prices went up dramatically in many places around 2020 and remained high. To young people, it must seem as if the goal posts have been moved. But the ratio of housing prices to wages was comparable to now from 1978-88, and was even much worse 1980-84.  There was another peak 2004-07 nearly as high as now. Three things are driving the false impression of unprecedented high house prices: not understanding overall inflation clearly, failing to account for interest, taxes, and maintenance, and surprisingly, the historically low, affordable ratios from 2010-2020. That really is enough to account for the resentment, but I have some things to add.

Those houses built in the 50s - 80s aren't the same houses now.  They have additions - garages, bedrooms, dormers, porches, whole floors, outbuildings, pools, paved driveways, bay windows, fences and stonework, breezeways - and that's just the exteriors. They have refinished basements, kitchens that are not just maintenance replacements, but significant upgrades, better bathrooms, better heating and especially cooling systems. A woman a little older than me remarked to her daughter-in-law recently that she could tell the neighborhood was stable because so many of the houses had additions. I had not thought of that, but it is true that people add on rooms for living there, not for resale. Stability is also a kind of wealth. Related to this is what I noted at the beginning.  We all know the later story of our grandparents, parents, and even our own houses, and this is true for our children and grandchildren as well. They may not expect a house as good as their parents', but they do want something that is about halfway along the progress line right out of the gate.

Let me add that I have lived in terrible houses and driven terrible cars. It doesn't much matter.