American poor can buy cheap consumer goods but have a harder time purchasing important items

I argued a ways back that Americans in poverty who own electronic goods illustrate the ubiquity of these goods in American life. Here is some evidence: the relative cost of consumer goods has dropped in recent decades while goods associated with leaving poverty, like higher education, have increased.

This is the tension at the core of modern impoverishment, which Annie Lowrey takes on in the New York Times today. The wonders of globalization, modern manufacturing, and ruthless Walmart-style supply-chain management have made the stuff we buy to fill our homes and time much cheaper, and as a result the poor now enjoy a level of material well-being that would have seemed unimaginable decades ago. The safety net is also infinitely more generous compared with the early 1960s, before Lyndon Johnson launched his war on poverty. Yet, because the prices of key services are spiraling out of control, the poor’s lot is still rather hopeless. The NYT captures it in this very, very long graph…

nyt_cost_graph

New York Times

Here’s what makes this trend so treacherous: Prices are rising on the very things that are essential for climbing out of poverty.

Another way to think about it might be that most Americans have a baseline of consumer goods they own. But, to move up in status or to purchase goods and services that can help one achieve mobility, more resources are needed.

It is too bad Internet service is not indexed here.

If one were to approach this from a Marxist point of view, perhaps the purpose of cheap goods is to keep people distracted while social life and economic life declines or is more exploitative. What is there to complain about what the typical person has a smartphone or a large LCD or LED TV and lots of viewing options?

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