Backward

If we genuinely wish to recreate past living standards, we face significant challenges. The first, of course, is that time travel remains a fantasy. Despite the imaginative tales of Michael Crichton, we are no closer to achieving this than when "Timeline" was published in 1999.

Secondly, the realities that enabled the lifestyle of the Western world through the 20th century have fundamentally changed. As developing nations have progressed, exploiting them has become more challenging. Progress has made everyday goods more expensive.

This reflects a global issue: the “someone will do this job for less” dilemma. Established economies in Europe and North America now resemble a high-school-educated department head earning $180,000 while watching newly minted MBAs take positions for $65,000.

Tick. Tock.

I’m not arguing that the department head's situation is “fair,” nor do I believe anyone deserves to see their living standards decline. What I’m stating is that, due to technological advancements, many jobs are now feasible in various parts of the world.

With developed nations offering salaries significantly higher than those in other countries, it’s likely that the “winners” of the past will find themselves at a disadvantage in the future.

Thus, we must accept that a return to 1966 is impossible, no matter how fervently some wish for it.

Instead, we could examine policies and norms from that time to see if any could be appropriately reinstated today. Ironically, many advocating for a return to a “better” era would likely protest if we began implementing those very changes.

For instance, a typical liberal might point out that the highest income tax rate in 1955 was 91%. However, this argument is somewhat misleading, as that rate applied only to joint incomes exceeding $4.65 million in today’s dollars, or $2.3 million for single filers.

Should we establish an ultra-high tax bracket for million-dollar earners? That’s a valid discussion, yet comparing today’s top rates with those from the past isn’t necessarily a fair comparison.

Nevertheless, tax rates were indeed higher in general. The top income for single filers today is $314,150, which equates to just under $27,000 in 1955 dollars, placing it in a 37% bracket today, compared to a 62% bracket back then.

To those who wish to improve our world “again,” I propose raising taxes by 25% immediately. These funds could support wage increases and housing subsidies, potentially easing the path to homeownership for many.

However, I doubt the crowd yearning for a return to the past would genuinely support such a measure, so it appears off the table.

Another common claim is that life was more affordable back then, with the ability to support a family on a single income and greater upward mobility. While there’s some truth to these assertions, there’s a significant caveat:

You were likely a white male.

The labor market of the past was “artificially scarce.” Due to a toxic mix of societal norms, bias, and outright discrimination, countless individuals were excluded from numerous careers.

Women were often relegated to being secretaries or homemakers, while people of color faced systemic barriers to entry in many professions.

Data indicates that even though labor force participation has decreased in recent years, it remains higher than levels seen in the 1950s. During the pandemic's peak layoffs, participation stayed 2-3% above the pre-1965 average.

When you allow only a fraction of the population to fill necessary roles, it’s no surprise that salaries rise. Essentially, this has cornered the labor market.

If we were to today exclude individuals based on arbitrary traits, it’s likely that those who remained would see a rise in demand for their services and, consequently, their salaries.

This isn’t a viable or ethical method for increasing wages, nor is it something we should aspire to return to. Some may wish for that era, but that system was both unjust and, thankfully, impossible to recreate. Thus, we can discard that notion.

Lastly, let’s address the notion that everything costs more today. While nominally true due to inflation, that’s not the core of the complaint. What people are really expressing is:

“My salary doesn’t stretch as far as it used to.”

This could be accurate depending on the time frame discussed. For instance, over the last five years, it definitely holds true. Despite media narratives about a “great economy,” the median household today has less purchasing power than it did five years ago, with declines each year since 2019.

Conversely, when people reminisce about how simpler it was to purchase items in 1968, we’re comparing different contexts.

The average home price has indeed risen relative to average salaries, with escalating mortgage rates compounding the problem. I’ve discussed housing extensively in previous articles and won’t reiterate those points here, except to note that both market forces and our own policies have contributed.

We’ve complicated zoning, permitting, and construction processes with countless regulations that drive up costs. While some are intended to ensure safety or protect property values, others seem unnecessarily burdensome.

You can’t implement measures designed to inflate property values and then lament that housing is unaffordable.

The lending process is similarly convoluted. I still remember the complexities of the Truth-in-Lending Act like a nightmare.

Moreover, we’ve been building increasingly larger homes with more luxurious materials for decades. The homes of 1967 and 2024 are hardly comparable beyond their basic structure. While prices have risen, expectations for features have also changed dramatically.

Think back to the kitchens of your childhood home or those of your grandparents. Were they filled with vinyl and wood? I know mine were.

Now, consider the last new home you encountered. Any vinyl there? What materials were the countertops made of?

Sometimes, our own expectations contribute to rising costs. Cars were more affordable in the past, but we could achieve similar price points today by eliminating features like power steering, air conditioning, and modern safety measures.

Indeed, cars are pricier, but they also come equipped with advanced technology and safety features that the older models lacked. We could revert to producing cheaper, less equipped vehicles if there was a demand for them—assuming, of course, regulatory hurdles didn’t make such production impossible.

A blend of market forces, expectations, and regulatory impacts has shaped our contemporary landscape. For better or worse, returning to the past isn’t feasible.

We must seek a path forward rather than nostalgically gazing back.

Progress

This isn’t to suggest that we can’t learn from our history. Discarding the past entirely is nearly as reckless as insisting we must revert to it.

The tax rates we discussed earlier warrant reexamination. While I’d never advocate for a 90% tax rate, we do face a growing income distribution issue in the U.S. (and many other developed nations) that necessitates a reassessment of our values.

If the middle class loses purchasing power and income to the top 3-5%, living standards will inevitably decline. The economic pie isn’t expanding rapidly enough to accommodate that shrinking slice.

Our increasingly globalized economy may even cause that pie to contract among traditionally “wealthy” nations, further intensifying domestic income distribution challenges.

During the height of the middle class, union membership was robust. Research from Pew and Gallup indicates that many Americans view the decline of unions negatively, suggesting a potential appetite for change.

Among non-white-collar roles that still offer livable wages, most have retained strong union representation. Perhaps reviving union membership to mid-20th-century levels is one practical approach to consider.

That said, a balance is necessary. While we may want more unions to safeguard employee rights and wages, we must be cautious of unintended repercussions.

Anyone familiar with the USAJobs hiring process understands how excessive regulations can hinder timely hiring. The average timeline for hiring is around five months.

We can’t suffocate employers entirely, especially given their soaring profits and stagnant wages in recent years. Yet, I believe it’s reasonable to hold them somewhat accountable, with unions leading the charge.

Lastly, the developed world must reassess its expectations for a “comfortable” lifestyle. In America, we often live beyond our means and rely on debt unnecessarily, all in pursuit of desires that may not be essential.

Do I truly require hardwood or tile floors to be content? How much ceiling height is excessive?

I rarely find myself floating twelve feet above my living room floor, but I suppose that’s a personal choice.

How many TVs do we need to watch at once? If the answer isn’t seven, do we genuinely need that many to feel fulfilled? If we’re asking for more, we need to be honest about how much more is truly necessary.

People from the past might have had more disposable income, and one could argue that claim has merit.

However, they also recognized the value of needing less.

If we’re going to keep glancing in the rearview mirror, let’s ensure it reflects a clear image. Not everything was as wonderful as it’s been portrayed, and some aspects were downright grim. We can learn from the past to enhance our future.

It’s not an either/or scenario.