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xchrom

(108,903 posts)
Sat May 3, 2014, 08:31 AM May 2014

Why America's Essentials Are Getting More Expensive While Its Toys Are Getting Cheap

http://www.theatlantic.com/business/archive/2014/05/its-expensive-to-be-poor/361533/

?n4y2zx

In the last ten years, what's gotten more expensive? And what's gotten less expensive?

Here's a fascinating snapshot of the last decade in American prices...



***SNIP

Two observations here.

1) On poverty: Jordan Weissmann nails it: "Prices are rising on the very things that are essential for climbing out of poverty." The road to upward mobility is uncertain, but we know the checkpoints. Graduating from college—whose sticker price is actually rising faster than its actual cost—correlates with higher employment and richer earnings. Chronically sick children affect parents' mental health, and chronically sick parents hurt a family's well-being. Single moms and dads who can't afford daycare and wind up spending lots of hours watching after their kids have trouble finishing school or establishing themselves in the workforce. Just as the benefits of wealth create a virtuous cycle of behavior, the challenges of poverty start a vicious circle that continues to spin down through multiple generations.

2) On productivity: When you look at the items in red with falling prices, they largely reflect industries whose jobs are easily off-shored and automated. The secret to cutting prices (over-generalizing only slightly here) is basically to replace American workers. If you can replace U.S. labor with foreign workers and robots, you're paying less to make the same thing. Look back at the items toward the bottom of the graph. Our clothes come from Cambodia. Our toys come from China. Meanwhile, Korea, a world-leader in electronics and auto manufacturing, has the highest industrial robot density in the world. Cheap things aren't made by American humans.
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xchrom

(108,903 posts)
2. every one should be skeptical of the whole 'cheap' thing.
Sat May 3, 2014, 08:35 AM
May 2014

that's how they stole from us in a number of ways.

from shipping jobs over seas to giving 'cheap' products in lieu of pay rises.

canoeist52

(2,282 posts)
3. Should have included fuel costs on the top side of the graph.
Sat May 3, 2014, 08:40 AM
May 2014

And computers are cheaper because they come with no software of any value, making them barely functional. Remember when Microsoft Office and Money and in-depth photo editing software with actual back-up DISCS were included in the box?

pinto

(106,886 posts)
4. Great graphic.
Sat May 3, 2014, 08:41 AM
May 2014

Sometimes seeing it in black and white, or red and blue in this case, really cuts to the chase.

Erich Bloodaxe BSN

(14,733 posts)
5. In re 2) - and also cheaper quality.
Sat May 3, 2014, 08:46 AM
May 2014

Make your items as cheaply as possible, with robots where you can, and slave labour where you can't, and substitute plastic for metal wherever possible, and crap 'metal' alloys made from whatever scrap comes along, rather than actual aluminum, steel, etc, because you're operating in a country with no real regulations.

Given the rise in online universities and traditional brick and mortar schools adopting more online or 'blended' courses, I wonder what part of the college experience is driving cost up.

snot

(10,530 posts)
7. It's also supply and demand.
Sat May 3, 2014, 10:42 AM
May 2014

We lower- and hollowed-out middle-classers continue to need food, shelter, and energy, healthcare, and childcare and to prioritize education; so they can raise prices as much as they want (hence the relatively high inflation in those numbers) and we'll still pay.

But we can live without the luxuries.

DirkGently

(12,151 posts)
9. A fact being used to argue the poor have it too good.
Sat May 3, 2014, 10:57 AM
May 2014

"Look, poor people have shoes and flat screens and cellphones!"

They just can't eat nutritious food or live indoors or afford gas or education.

So no one can complain, right?

Right?

Lydia Leftcoast

(48,217 posts)
10. The one that frosts me is "Poor people have DVD players and air conditioners
Sat May 3, 2014, 11:20 AM
May 2014

and refrigerators!"

Well, yeah, any apartment that is more than a furnished room is REQUIRED to have a working refrigerator provided by the landlord, and even the cheapest new apartments have at least wall air conditioners and maybe central air. I've been looking at apartment complexes in two different cities lately, and a lot of the cheap ones with bad reviews on Google and Yelp have cable included in the rent.

As for DVD players, maybe the commentator bought his when they cost $1000, but now they cost $30, and movies are $1.25 each at Redbox, which is a cheap evening's entertainment.

DirkGently

(12,151 posts)
12. And many people have cell phones but no land line.
Sat May 3, 2014, 11:42 AM
May 2014

Yet land lines are still used as a basis for approving credit. Or at least they were until recently. This despite the fact that if you can only afford one, a cell makes gigantically more sense, and is a necessity in many cases for seeking and having employment.

Lydia Leftcoast

(48,217 posts)
15. Right, and when the right-wing grouches complain about seeing poor people with smartphones
Sat May 3, 2014, 05:12 PM
May 2014

they may not realize that you can get an outdated model for free with even a minimum contract.

JVS

(61,935 posts)
11. If we set up boarding schools and colleges in China for US students, we could bring daycare and...
Sat May 3, 2014, 11:40 AM
May 2014

college tuition way down.

 

JEB

(4,748 posts)
13. Essentials are taking a larger portion of peoples' money
Sat May 3, 2014, 11:42 AM
May 2014

leaving non-essentials to compete fiercely for the remaining scraps of money. I am independent reseller of used (made in USA, antiques, etc.) goods. Prices on most items are down about 40%-60% from before 2008. Our beach tourist town has many empty store fronts. Welcome to the new austerity.

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