America is a land of abundance, one might even say decadence. Even America’s poor people are some of the wealthiest people in the world when the rest of the Earth’s population is factored in. Yet, this material prosperity has not brought about utopia, especially when one considers poor American health (particularly our shockingly high degree of obesity) and stress levels. Is it possible that this wealth, or rather the way we think about this wealth, is contributing to American woes? Is there something about the American ethos that leads us to also want more more more?
They say everything is bigger in Texas, but really everything is bigger in America, especially when compared to relatively wealthy European countries. On average, newly built American homes are much larger than European ones. American portion sizes, both at home and at restaurants have ballooned over the past few decades, far exceeding those in other developed countries. 90 percent of American households have air conditioning, again in sharp contrast to other developed countries.
This prosperity, while reaching hitherto unfathomable levels, is not new. In 1888 the Scotsman James Bryce published his voluminous work The American Commonwealth where he explores in great detail the various institutions and habits of American life from an outsider’s perspective. In one chapter, entitled “The Pleasantness of American Life”, Bryce relays the unexpectedly high standard of living he observed for even people of low socio-economic status, noting that in the U.S. “the working classes are as well fed, clothed, and lodged as the lower middle class in Europe” and that “the native American operatives in many a manufacturing town lead a life easier, and more brightened by intellectual culture and by amusements, than that of the clerks and shopkeepers in England or France.” Even today, despite European snootiness, when adjusted for purchasing power parity and cost of living differences, most European countries would be among the poorest U.S. states.
This material prosperity is not necessarily a bad thing, but decades upon decades of ever increasing material abundance has tended to warp American perspectives about what is normal and what is luxury and has altered our tastes and preferences.
The clearest manifestation of this altered perspective in action is what has been termed “lifestyle creep”, meaning that as American incomes grow larger we tend to increase our discretionary spending and consider that this new level of consumption is the new normal, rather than being luxurious and not strictly necessary. This contributes to the phenomenon of being “house poor” when people consume a very large percentage of their financial resources in their housing, sometimes purchasing as much “house” as they possibly can which in turn soaks up a great deal of money for years and even decades to come.
This lifestyle creep also explains at least partly why so many Americans, even wealthy ones, are living paycheck to paycheck and sometimes struggling to make ends meet. Lending Club released a report in 2021 that found that 54 percent of Americans live paycheck to paycheck, with 21 percent having difficulty paying bills every month. This is a problem that extends to all income brackets, with almost 40 percent of people who make over $100,000 living paycheck to paycheck and 12 percent struggling with bills every month. This is even worse when one examines only Millenials, 70 percent of whom live paycheck to paycheck, and 33 percent struggle to pay bills.
Americans are blessed to live in a truly prosperous country, but oftentimes our consumption habits are leading us to be stressed out and feel poor amidst all this abundance. However, it doesn’t have to be like this.
Economic value, in contrast to objective ontological value, is ultimately subjective. People’s ever changing subjective preferences are what give goods and services their market value, meaning that when people’s values change, their economic behavior changes as well. Right now, we Americans tend to value the big and the excessive. Huge homes are status symbols, as is frequently purchasing a new car or upgrading to the latest Iphone. Because of our values, we think less of smaller or simpler things and want the biggest, newest, and most expensive we can get.
But, were our values to change, smaller and simpler could be seen as better. Changing values and the ensuing preferences isn’t as easy as flipping a mental switch. We have had decades of cultural influences telling us that bigger is better. Think of shows like MTV Cribs that exhibit vast sprawling celebrity homes, or say Yes to the Dress, where people spend small fortunes on wedding dresses. Social media influencers are constantly flaunting their carefully tailored lives to look like they are living a life of elegant luxury.
Fortunately, just like we go to friends to get an outsider perspective on our own lives, we can go both to history and other cultures to see an alternative vision of what consumption and material culture can look like. In the next essay in this series, we will explore Japan’s history of material culture both before and during its process of modernization and how these decisions, which were ultimately rooted in a different value system and way of looking at the world, enabled Japan to rapidly modernize and take a leading role in the world economy, despite being completely lacking in industrialization in the mid-19th century. There may be some important lessons we can apply to our own financial situations today.
Zachary Yost is a freelance writer and researcher located in the Pittsburgh area. You can subscribe to his Substack, The Yost Post, here.
