“The poor are getting poorer and the rich are getting richer.”
You’ve likely heard this phrase… but it’s misleading.
There’s no doubt the rich are getting richer… but many folks don’t realize the poor are getting richer too. Living standards have improved across the board for all socioeconomic classes.
The average person in the U.S. today is far better off than the richest man was in the early 1900s (John D. Rockefeller).
Let me prove it to you.
You are now likely to live over twice as long as your great, great grandparents. Improved agriculture and healthcare is pushing your life expectancy higher.
You now have more time on Earth. And that time is more enjoyable…
In 1900, 41% of the U.S. workforce was dedicated to agriculture. Today, fewer than 2% of the U.S. labor force works in agriculture. Technology is doing the heavy lifting and freeing up your time.
Technology is not only increasing productivity, it’s entertaining you. The entertainment industry is bursting at the seams. Art, music, movies, video games, virtual reality… the selection for our idle time is never ending today. I can’t keep up with all the new great shows coming out.
The Bureau of Labor Statistics reported that the average person watches 2.8 hours of TV per day. Leisure time will continue to climb. And another big area of leisure is taking off…
In the late 1800s, a French author wrote the book Around the World in 80 Days. It took months and a fortune to travel around the world just a century ago. Traveling wasn’t easy.
My grandpa, for example, had to walk a few miles just to get to his schoolhouse. But the times have changed. You can travel at low cost with apps like Uber today. You don’t need to spend thousands to own a car and travel. In fact, I’ve called cars the worst investment for the average person today.
Today you can travel around the world in a day or two on the cheap. As a result, the travel industry is booming. Some countries rely heavily on it. About 20% of Greece’s GDP is from tourists.
And when you travel, you meet people. Staying in contact is also much easier today…
Information is at the touch of your fingertips. You can talk with people around the world “instantly” for little to no cost. Email, texting, Facebook, Skype… Imagine moving away from your family a century ago. You might get an occasional parcel but other than that, you’re out of sight and touch.
Smartphones are entering third world countries. Everyone in the world will soon have access to a computer and in turn, improved contact. The first Apple computer sold for over $2,500 in 1976 (inflation adjusted). Today you can buy a more powerful handheld for under $50.
I hope it’s now clear the rising tide is lifting all boats. The poor are getting richer too. Technology is pushing both the poor and rich forward.
But there is one big problem…
Economists agree the rich are getting richer faster. Harvard economist Richard Freeman noted, “The triumph of globalization and market capitalism has improved living standards for billions while concentrating billions among the few.”
All socioeconomic classes are better off today, but income inequality is still growing. It’s a well-founded concern.
The wealth gap is creating the need for a new economic paradigm. Wealth and income are concentrating in the hands of investors.
Still, capitalism is working to improve your life and the lives of billions of people. We all live wealthier than the kings of old. Heck, even showering regularly is normal today. Just one hundred years ago it was a luxury.
P.S. As always, if you enjoyed my research today, I’d love to hear from you. You can also sign up for my free weekly email here.