Scooped George Will By A Decade

George Will has a good article making the point that you are almost certainly richer today, in terms of the products and services you have access to, than a billionaire was in 1916.  Loyal Coyote Blog readers will have read roughly this same article over a decade ago.  In that nearly ancient post, I compared a middle class home-owner in my neighborhood to the owner of one of the largest mansions in America in the late 19th century:

House1aHouse2b

One house has hot and cold running water, central air conditioning, electricity and flush toilets.  The other does not.  One owner has a a computer, a high speed connection to the Internet, a DVD player with a movie collection, and several television sets.  The other has none of these things.  One owner has a refrigerator, a vacuum cleaner, a toaster oven, an iPod, an alarm clock that plays music in the morning, a coffee maker, and a decent car.  The other has none of these.  One owner has ice cubes for his lemonade, while the other has to drink his warm in the summer time.  One owner can pick up the telephone and do business with anyone in the world, while the other had to travel by train and ship for days (or weeks) to conduct business in real time.

I think most of you have guessed by now that the homeowner with all the wonderful products of wealth, from cars to stereo systems, lives on the right (the former home of a friend of mine in the Seattle area).  The home on the left was owned by Mark Hopkins, railroad millionaire and one of the most powerful men of his age in California.  Hopkins had a mansion with zillions of rooms and servants to cook and clean for him, but he never saw a movie, never listened to music except when it was live, never crossed the country in less than a week.  And while he could afford numerous servants around the house, Hopkins (like his business associates) tended to work 6 and 7 day weeks of 70 hours or more, in part due to the total lack of business productivity tools (telephone, computer, air travel, etc.) we take for granted.  Hopkins likely never read after dark by any light other than a flame.

If Mark Hopkins or any of his family contracted cancer, TB, polio, heart disease, or even appendicitis, they would probably die.  All the rage today is to moan about people's access to health care, but Hopkins had less access to health care than the poorest resident of East St. Louis.  Hopkins died at 64, an old man in an era where the average life span was in the early forties.  He saw at least one of his children die young, as most others of his age did.  In fact, Stanford University owes its founding to the early death (at 15) of the son of Leland Stanford, Hopkin's business partner and neighbor.  The richest men of his age had more than a ten times greater chance of seeing at least one of their kids die young than the poorest person in the US does today.

Hopkin's mansion pictured above was eventually consumed in the fires of 1906, in large part because San Francisco's infrastructure and emergency services were more backwards than those of many third world nations today.

Here is a man, Mark Hopkins, who was one of the richest and most envied men of his day.  He owned a mansion that would dwarf many hotels I have stayed in.  He had servants at his beck and call.  And I would not even consider trading lives or houses with him.  What we sometimes forget is that we are all infinitely more wealthy than even the richest of the "robber barons" of the 19th century.  We have longer lives, more leisure time, and more stuff to do in that time.   Not only is the sum of wealth not static, but it is expanding so fast that we can't even measure it.  Charts like those here measure the explosion of income, but still fall short in measuring things like leisure, life expectancy, and the explosion of possibilities we are all able to comprehend and grasp.

I have a similar reaction every time I tour the mansions in Newport, RI.  They are magnificent in their way, but they are also cold, and to my modern eye, unlivable.  Think of it this way -- You are trapped alone on a desert island.  A plane airdrops you a crate of diamonds.  You are rich, right?

 

 

29 Comments

  1. Nigel Sedgwick:

    Very minor quibble.

    The electric telegraph provided USA coast-to-coast connectivity from 1861; Mark Hopkins died in 1878. So he had access to long-distance business communication, I suspect with delay of less than a day.

    Best regards

  2. J_W_W:

    And yet progressives are screechig and signaling that they'd pick being rich in the past....

    This, I think, is because their entire worldview is based on envy and wanting what others have.

    Why would being a normal modern be of any good to them when they could be an elite from the past... Envy dominates progressive lives. And their embrace of making something that is part of multiple of the Ten Commandments be instead a sacrament of their religion is very dangerous.

  3. cc:

    You didn't even mention the smells. Every mansion had horses around it, which stink to high heaven. Heat was likely fireplaces so everything smelled like smoke. Most people did not bathe enough and any crowd of people were stinko. Travel by train was hot or cold, depending on season, and you breathed the train fumes (coal fired).
    One of the richest people, a Vanderbilt I think, had a teenage son who stubbed his toe--it got infected and he died. Unheard of today.
    I can get fresh fruit year round, but they could not. I can get flowers year round for cheap at the grocery.

  4. DirtyJobsGuy:

    The comfort factors are true, the poorest in the USA have more comfort and entertainment (as well as health care) than anyone in the 1890s. But communications and computers are a poor measure. The Pony express was briefly run to help tie the West Coast to the USA in a few days. Rail and Telegraph superseded that. Most big cities had twice a day mail delivery and you could send a letter in the morning and it was delivered that day. Messengers would be faster. A US Citizen in the 1890s (except black americans) had more liberty and freedom of action than any of us today. They were lightly taxed, could enter almost any profession or enterprise with a minimum of formality and started their responsible lives at an earlier age than today. Their grade school education was often better than today's 12 year slog and many sought out lectures and correspondence schools for further education.

  5. tmitsss:

    My favorite example is Vizcaya the mansion built by James Deering on Biscayne Bay in 1915. One of the richest men in the US at the time, he moved to Miami because he suffered from pernicious anemia (from which he died in 1925). You can be treated for PA for pennies.

  6. mlouis:

    My NYC apartment is identical to what it was 30yrs ago and the rent is 10x. I dont see that as being productive.

  7. SamWah:

    George Will has been behind the times for some time.

  8. Joshua:

    Your decision to stay in NYC indicates that you are receiving some value from your geographic location.

  9. Joshua:

    I still wouldn't trade lives with them. Would you? To me, that's the ultimate measure.

  10. kidmugsy:

    Why were these people drinking warm lemonade? Didn't rich Americans have ice houses?

    Why had he no running hot water? Didn't rich people heat their water with town gas?

    And, of course, if he lived in California he had no need for air-conditioning; a combination of decent insulation and ceiling fans should have done him quite well. (Are we allowing the rich man electricity at the end of the 19th century?) As for the lack of flush toilets, I am surprised but I assume you've done your homework on that.

  11. Matthew Slyfield:

    No, at that point in time, town gas was only used for gas lamps.

    He probably had a coal fired boiler for steam radiators, but likely not running water hot or cold.

  12. irandom419:

    But the house on the left will motivate people to kill in the name of envy, while the one of the right puts people to sleep.

  13. Heresiarch:

    Shoulda bought!

  14. CapitalistRoader:

    Put its occupants to sleep, knowing that they'll have a pleasant night's rest, with the temperature and humidity controlled to less than 5% variation from their personal comfort zone, a hygienic and comfortable place to eliminate bodily wastes, a pleasant place to prepare and consume safe and tasty food, a quick and private method to clean clothes and bedding, all without the necessity of having to let in (and having to pay) unrelated strangers to the house to do all those nice things for you.

    Or are you comparing the aesthetics of the fussy, garish pile on the left to the functional, unobtrusive home on the right?

  15. Ombibulous:

    Mark Hopkins never drank warm lemonade in that house...because Mark Hopkins lived in that house. He died before it was finished. Also, Mark Hopkins never sired any children. His wife had an adopted son who lived to the age of 77 years.

  16. Ombibulous:

    Mark Hopkins never drank warm lemonade in that house...because Mark
    Hopkins never lived in that house. He died before it was finished. Also, Mark
    Hopkins never sired any children. His wife had an adopted son who lived
    to the age of 77 years.

  17. Ombibulous:

    But your points are well taken.

  18. J K Brown:

    Smells....have you ever used an outhouse? How about a chamberpot that sat all night by your bed if you were the most privileged?

  19. J K Brown:

    And still, shortly after midnight on January 1, 1900, J.P. Morgan walked down the stairs from his office to his horse drawn carriage to return to his home where he couldn't easily microwave a meal or cup of coffee.

    A description of the most common mode of transporation

    But horses were everywhere, pulling surreys, democrats, buggies, cabs, delivery wagons of every sort on Main Street, and pulling harvesters on the tractorless farms out in the countryside.

    The sights and sounds and sensations of horse-and-carriage Iife were part of the universal American experience: he c!op-clop of horses' hoofs; the stiff jolting of an iron-tired carriage on a stony road; the grinding noise of he brake being applied to ease the horse on the downhill stretch; the necessity of holding one's breath when the horse sneezed; the sight of sand, carried up on the tires and wooden spokes of  carriage wheel, spilling off in little cascades as the wheel revolved; the look of a country road overgrown by grass, with three tracks in it instead of two, the middle one made by horses' hoofs; the special maIe ordeal of getting out of the carriage and walking up the steeper hills to lighten the load; and the more severe ordeal, for the unpracticed, of harnessing  horse which could recognize inexperience at one scornful glance. During the Northern winter the jingle of sleigh bells was everywhere. On summer evenings, along the tree-lined streets of innumerable American towns, families sitting on their front porches would watch the fine carriages of the town as they drove pst for a proud evening's jaunt and the cognoscenti would wait eagerly for the glimpse of the banker's trotting pair or the sporting lawyer's 2:40 pacer. And one of the magnificent sights of urban life was that of the fire engine, pulled by three galloping horses, careening down a city street with its bell clanging.

    --'The Big Change: America Transforms Itself 1900-1950' (1952), Frederick Allen Lewis

  20. marque2:

    Hmm, at his point in time, town gas was also used to run small engines - frequently used to power things like automatic sewing machines. It was town gas engines which were the precursor to the automobile engine, circa 1880s.

    I think town gas was used for many things. Though I would guess the water could be heated by coal or wood as well.

  21. mlouis:

    When a society concentrates wealth, and those wealthy decide to essentially live in walled-off communities (or rivers in the case of Manhattan) you have little choice but to live near them if you work in professional services. I'm not complaining...just pointing out that housing has become quite unproductive...and is a very large share of the consumer budget (unlike manufacturing and tech goods which typically get pointed to as signs of productivity).

  22. mlouis:

    Whether or not i own Manhattan properties is beside the point. Housing has become a very unproductive sector of the economy.

  23. Zachriel:

    Poor is having one goat while your neighbor has two. Rich is having two goats while your neighbor has one.

  24. Zachriel:

    One house has hot and cold running water ... a vacuum cleaner, a toaster
    oven, an alarm clock

    Please meet hot and cold running water.

    refrigerator ... One owner has ice cubes for his lemonade, while the other has to drink his warm in the summer time.

    Ice was easily available at the time, even for the middle class. Ice boxes were common. Dolly Madison served ice cream at a ball in 1813.

    One owner can pick up the telephone and do business with anyone in the world, while the other had to travel by train and ship for days (or weeks) to conduct business in real time.

    The telegraph was ubiquitous. The transatlantic telegraph dates to 1858.

  25. Zachriel:

    Then there's the choice of women...

  26. Zachriel:

    Georgian era iPod for the rich:
    https://www.youtube.com/watch?v=dBgaO9Va5cA

  27. Ann_In_Illinois:

    How much of the cost is due to rent control?

  28. obloodyhell:

    }}} One owner has ice cubes for his lemonade, while the other has to drink his warm in the summer time.

    Probably not this one, they'll have an ice cellar, for sure. But the point is still, on the whole, valid.

  29. BGThree:

    The technology available in any given era is not a good proxy for wealth. True, An ancient Assyrian king or Roman emperor couldn't play Angry Birds. However, unlike almost all iPad owners, he could arrange to tar and feather humans and use a catapult to launch them at a building until it collapsed. The ancient king is wealthier than the iPad owner because everything the society has to offer is at his fingertips.

    The only way to compare wealth as opposed to technology is to look exclusively at goods and services that are mostly unchanged over the eons: a steak, a prostitute, a set of ordinary clothes, a set of fine/professional clothes (e.g. a man's suit), a doctor visit (NOT the medicine or treatment, which is technology-dependent, but the cost of 15 mins of a doctor's time).

    There are records of the cost in gold/silver of things like this going back to ancient times. The cost of a man's suit in gold is relatively stable over 2000 years. However, the end of gold backed currencies has drastically changed the situation. Minimum wage when Nixon closed the gold window would be $47,50/hr today, if dollars were still convertible to gold. 50 years ago, a blue collar job easily supported a family with homemaker spouse and 2+ kids, including buying a house and retiring before 85. That blue collar worker is wealthier than a professional making $100k/yr today, if you look at relative abilities to provide for a family and accumulate savings.

    Technology is not wealth. Ability to provide universal human needs for a dependent family, plus having some left over to save, offers far better insight. Incidentally, this is why a revolution or global war or other cataclysm is inevitable: Capitalism requires capital. Capital formation requires accumulation of savings. Fiat currency, fractional reserve lending and artificially low interest rates have killed new/future savings while destroying existing savings that get "invested" in everything from Snapchat to real estate to hedge funds.

    I'm not a Luddite, I love technology. Some of my best friends are technology. But conflating technology and wealth simply hides the fact that the financial system is a parasite on productive economies. Capital is being stolen drip by drip from people that make things or provide skilled services by people who create transactions for transaction's sake because they get a piece of each one. Before you know it, the capital that used to be a complex factory has been converted at the Fed window into Lamborghinis, yachts and breast implants.