David Brooks continues to write thoughtful op-ed pieces in the NYTimes. This time he wrote about a shift in culture over a few generations from wealth seeking to looking more at the quality of experience. Using an example of a grandfather (Sam) and his grandson (Jared) and the ways they looked at the economic life, he argues that today’s young wage earners are seeking different values.
First describing life early in the twentieth century, Brooks points to Sam:
Sam wasn’t the most refined person, but he understood that if he wanted to create a secure life for his family he had to create wealth.
Then jumping over a generation, he compared Jared’s outlook:
But for Jared, wealth and living standards have diverged. He is more interested in the latter than the former. This means that Jared has some rich and meaningful experiences, but it has also led to problems. Every few months, new gizmos come out. Jared feels his life is getting better. Because he doesn’t fully grasp the increasingly important distinction between wealth and standard of living, he has the impression that he is also getting richer. As a result, he lives beyond his means. As Cowen notes, many of our recent difficulties stem from the fact that many Americans think they are richer than they are.
He raises this trend as an alternative explanation for the current economic stagnation to that proposed by Tyler Cowen in his eBook, “The Great Stagnation.” Cowen argues that the economy has been stagnating since about 1974 when the last of the low-hanging economic fruit was plucked.
Brooks’ point is that the stagnated economy and consequent loss of job opportunities may be partly attributed to this change in values away from almost pure materialism of Sam where wealth is the primary indicator of status, rather than the disappearance of the low-hanging opportunities.
Even if what Brooks says is true, Jared is not yet in the mainstream if one pays attention to what our leaders and policy makers are saying and doing. We are still using the same economic policy models and indicators that were used in 1974, perhaps even more tilted toward wealth accumulation for the rich and powerful with little left over for the masses. I would like to believe Brooks is on target, but my non-scientific, but active, listening to consumer culture indicates otherwise. Malls are still the number one destination for many. People like Jared have little alternative but to seek satisfaction from non-materials means; their plans to keep up with the neighbors have been put on hold. Even Brooks notes that the Jared’s out there are confused about how to make economic choices.
There is much circularity at play today. People are seeking alternate non-material means of life satisfaction because they have fewer resources to play in the consumer market game. To the extent they do go shopping, they tend to buy goods made in low-wage countries, adding to the forces of stagnation. Shifts away from goods in general and especially those made in the US leads to more job loss and pressure for lower wages. And, without some form of intervention, this cycle goes on and on. Not a pretty picture even for the new Jared’s and their appreciation for the quality, not quantity, of life.