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What America Buys
Old 04-05-2012, 04:11 PM   #1
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What America Buys

Food seems to be our greatest expense these days in our household. We no longer have a mortgage, but HO insurance and property tax run a combined $400/mo, so I guess that would count as "housing" in this comparison. Housing is lower for us than most of the USA. Interesting comparison.

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We can also use this data to see how Americans' spending patters have changed over time. Here's a comparison of spending in 1949 versus 2011.

Source: Bureau of Labor Statistics
Credit: Lam Thuy Vo / NPR




One thing that jumps out here is the relative decline in spending on food and clothes. This is largely the result of incredible productivity increases in agriculture and manufacturing that have made food and clothes much, much cheaper in real terms.
What America Buys : Planet Money : NPR
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Old 04-05-2012, 04:29 PM   #2
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I'm surprised that food is less of an expense... with how expensive restaurants are these days and the numbers of families choosing McDonald's over the dinner table at home (though I guess McDonald's does pack a lot of calories into a pretty small price... so maybe that is actually contributing to the trend)
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Old 04-05-2012, 04:33 PM   #3
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And yet we're more obese than ever! jk

Thanks, I like charts...
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Old 04-05-2012, 04:38 PM   #4
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The one constant appears to be recreation spending. It would be interesting to see what type of 'recreation' the 5% spent in 1949 purchased vs. the 6% today. A road trip and croquet lessons 1949 vs. yoga lessons and a cruise in 2011?
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Old 04-05-2012, 04:45 PM   #5
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The one constant appears to be recreation spending. It would be interesting to see what type of 'recreation' the 5% spent in 1949 purchased vs. the 6% today. A road trip and croquet lessons 1949 vs. yoga lessons and a cruise in 2011?
Constant and weak. 6%? Come on, what is wrong with people? Here's another look at where we spend, but this time compared to three other countries. Here we can see that the Brits spend 2.5x what we spend on both recreation and alcohol, to which I say "Cheers."
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Old 04-05-2012, 04:56 PM   #6
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I can attest to food being extremely expensive in Japan. I was blown away at how much it cost to eat there (restaurant or grocery store, everything seemed about double what it is here for the same quality). They spend more on food while eating way less...
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Old 04-05-2012, 04:57 PM   #7
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In 1949, people bought the kind of housing they could afford.
In the last 30-40 years or so, we have been conditioned to buy the most housing we can possibly afford, so the increase in housing costs (McMansions) is understandable.

In 1949, going to a restaurant was a special treat. People got dressed up for real restaurants, and even a neighborhood pizza place was an uncommon visit (at least in my little world). But even though we mostly ate our own cooking, the prices of various food items are all over the map. Just to take one example, the price of a dozen eggs is not much different today from what it was then, but the price of a good steak is probably ten times what it was then.

But we didn't have machines that dried our clothes (just a piece of rope in the backyard), we didn't have phones we could carry in our pockets, and if we were lucky, we had cars that would be considered laughably primitive by today's standards.

Bottom line, I don't think this sort of comparison works (however interesting it may be), just because our lifestyles are so utterly dissimilar.
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Old 04-05-2012, 06:19 PM   #8
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15% Food 45% Housing 2% Apparell 3% Transportation 10% Recreation 16% Med 9% Other
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Old 04-05-2012, 08:05 PM   #9
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Quote:
Originally Posted by mickeyd View Post
One thing that jumps out here is the relative decline in spending on food and clothes. This is largely the result of incredible productivity increases in agriculture and manufacturing that have made food and clothes much, much cheaper in real terms.
I would actually offer a different view on the clothing part - while I'm only 35, I get the impression that a majority of clothes were made in the US back in 1949, versus a VAST majority of clothes these days made in Vietnam/Taiwan/China/Korea/Indonesia/insert other Asia country. It's true that there are cost reductions due to efficiencies in manufacturing, but I'm thinking a big part of it is the savings from offshoring the manufacturing.

Actually, it would be interesting to see what the workers in Asia at the apparel factories earn today compared to the total wage/benefits cost of US workers that made the apparel back in 1949.
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Old 04-05-2012, 09:43 PM   #10
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Where are taxes in those charts?
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Old 04-05-2012, 11:55 PM   #11
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One thing that jumps out here is the relative decline in spending on food and clothes. This is largely the result of incredible productivity increases in agriculture and manufacturing that have made food and clothes much, much cheaper in real terms.
Quote:
Originally Posted by braumeister View Post
In 1949, people bought the kind of housing they could afford.
In the last 30-40 years or so, we have been conditioned to buy the most housing we can possibly afford, so the increase in housing costs (McMansions) is understandable.
Or another interpretation is that housing prices could have gone nuts.

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Originally Posted by braumeister View Post
In 1949, going to a restaurant was a special treat. People got dressed up for real restaurants, and even a neighborhood pizza place was an uncommon visit (at least in my little world). But even though we mostly ate our own cooking, the prices of various food items are all over the map. Just to take one example, the price of a dozen eggs is not much different today from what it was then, but the price of a good steak is probably ten times what it was then.
But we didn't have machines that dried our clothes (just a piece of rope in the backyard), we didn't have phones we could carry in our pockets, and if we were lucky, we had cars that would be considered laughably primitive by today's standards.
Bottom line, I don't think this sort of comparison works (however interesting it may be), just because our lifestyles are so utterly dissimilar.
The BLS would like to thank you for personalizing their curriculum on the subject of "hedonic adjustments to the CPI"!
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Old 04-06-2012, 06:57 AM   #12
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Originally Posted by MooreBonds View Post
I get the impression that a majority of clothes were made in the US back in 1949, versus a VAST majority of clothes these days made in Vietnam/Taiwan/China/Korea/Indonesia/insert other Asia country. It's true that there are cost reductions due to efficiencies in manufacturing, but I'm thinking a big part of it is the savings from offshoring the manufacturing.
We should thank globalization for it. There is a PBS documentary called "China Blue" about this topic. After watching it, not sure we should feel being blessed or cursed instead.

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Originally Posted by EvrClrx311 View Post
I can attest to food being extremely expensive in Japan. I was blown away at how much it cost to eat there (restaurant or grocery store, everything seemed about double what it is here for the same quality). They spend more on food while eating way less...
Their motto is quality not quantity. There's another excellent PBS documentary, "King Corn". It sheds light on how policy was put in place to boost food (corn) production so that food prices become artificially low. It does come with hefty price in different terms. As put by one farmer being interviewed in the documentary, no way will his family eat those cr*ps grown in his farm.
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