something has changed

Catskills from Hudson, Hudson Valley, New York, 1990


Back in the 50s and 60s a large portion of the New York City population escaped the city for the Catskills during the summer.
The families would relocated to cabins, and the mothers and children would set up camp for months while the husbands commuted back and forth to the city, arriving late Friday or Saturday morning and leaving Sunday afternoon to resume their working schedules.  Blue collar workers, white collar workers – most people had the ability and at least option to spend their money this way. We watched a documentary about this lifestyle and wondered where that disappeared in this day and age.  Spending a summer in a camp would be prohibitively expensive.

Even closer to home, I moved to Manhattan about 12 years ago. As a single man with a roommate I was able to afford a top floor, two-bedroom apartment that took up a wing of a doorman building.  The apartment was large and in the middle of the Chelsea section of Manhattan, a trendy and convenient place to live.  I made about half of what I make today.  I was single, but I was still saving money and living a moderate lifestyle (granted, lots of going out but no crazy purchases of things).

Somewhere in the last few years something changed. The cost of living in New York accelerated far past the salary increases; the cost of housing lurched past the cost of living.  Things became HARD.  The trend is common throughout the urban parts of the US; somewhere over the last decade living simply became harder.  Nothing changed significantly, but people found that their salaries didn’t go as far, and houses were a bit smaller, and things were just a bit tougher.

When I started work in 1994, I didn’t pay for health insurance.  Today I pay $1400 per month. When I came to Manhattan, I still knew places that sold $2 beers.  I have paid $8 for a beer recently.  Somehow things got a lot more expensive, quickly.

This proves nothing, but it seems that something has changed in America over the last couple of decades. Credit is cheap and easy to obtain, so many of us have been able to maintain our lifestyles without noticing an erosion of earning power.  Those of us who don’t use credit have gone from feeling free with money to feeling tight every time we reach for a wallet.

Perhaps this is a good thing. It may not be terrible that people realize that they can’t afford everything.  Not everything is in reach.  Yet at the same time, it’s become disturbing to me that things that were difficult, but possible, when I came to New York are now pipe dreams – buying a nice two-bedroom in Chelsea with a doorman and a gym.  It was possible in the mid-90s.  It’s a ridiculous fantasy now.  My salary has dramatically increased – more than doubled in the past 10 years – yet the possibility of buying a condo like that has gone from doable to impossible.  I doubt I could even get a bank to look at me now.

Something has changed. It may just be that the economy has adjusted, but I think we are seeing a shift – particularly in large urban centers, but probably throughout the US – towards a rental society.  Things that you rent – cable TV, cheap credit, cheap McMansions bought with hideous amounts of leverage – these things are still easy to obtain.  But a stable, sustainable form of living has become far more difficult to obtain.  Maybe it’s easier away from the coasts.  But whatever has changed, it seems easy to conclude that nothing has changed for the good.

photo credit: PhillipC

12 comments

  • Chad @ Sentient Moey

    We are definitely experiencing a fundamental change. So much wealth had been created in our mega cities (NYC, DC, London, etc.) that living costs have gotten out of control. At some point the cheaper cities (Pittsburgh, etc.) would seem to be able to make a strong case as growth areas. In Pittsburgh $250k buys you an awesome house. In DC where I currently live $250k barely buys you a 1 bedroom condo. Plus, Pittsburgh still has a ton of good places for a cheap beer. Not so much in DC. Sure, Pittsburgh isn't as “happening” as NYC or DC, but you have a much better chance of becoming very financially stable in Pittsburgh than the mega cities. I used Pittsburgh, as I'm very familiar with the city.

  • I agree that there has been a change. Many many more people are moving to the cities because that is where the money is, present economy excluded. While everyone wanted the better life many could only afford to make paents on that life. Now we're out of credit. I think you're going to see a big decline in what we always thought was the good life. IMO this is a good thing.

    For you though, this migration to the city may mean it's time to migrate to the 'burbs.

  • Sure, it's nice to know you can't afford everything and you need to live within your limits. But also it's tough to know that a simple night out with the guys grabbing a few beers, is the equivalent to a fancy dinner now. Seems like the basics have gotten more expensive so to live in the same standard of living you are used to, you need to pay more.

  • I agree with you. When my ex first left me, I could afford to keep the house and still pay for my work van. 5 years after he left I could no longer afford it, even though I was working more, making more and he was giving me more child support. My money out hadn't changed from 2000 to 2003 (in fact, I had dropped some expensive friends, so it had become less) but it just didn't go as far. Now, 6 years from that time, I am renting out space in someone else's house, I am down to one vehicle (and in my business, that is a bad thing), and I am squeaking by. Yes, things are definitely tighter for those of us who are trying to live without paying with plastic.

  • It the availability of money. More money causes inflation. So much cheap money for so many years and we've priced ourselves out of the things we wanted the money for! Maybe now that money is getting harder to come by prices will slow down. It's happening in housing, even in NYC.

    Manhattan has turned into this place that only out of towners live in. It's great that many neighborhoods have gotten better, like the lower east side, but at the same time many have lost a bit of their charm and now are out of touch with their roots. There was a time years back when we'd go down to Avenue A on a Saturday night and get a spot on the avenue. Now you have to leave in the afternoon to hope to do that.

    • I agree, it's inflation! Our salaries cannot keep up with rising costs. I've seen it in the extreme form in post-USSR regime. American inflation is slowly creeping up on us and a few years later we start wonder “what has changed?” Going out to movies and dinner became expensive, even luxury for some.

  • In the UK, there's the same sort of phenomen with London as you're noticing with New York. Thing is, as far as I know over here it's a perpetual and ongoing problem. London and the South East are like massive attractors – as more and more people become attracted to the lifestyle and the jobs they both push costs up and make it more desirable which attracts more people etc. There are other cities in the UK, but they don't have the same pulling power.

    As for New York, wasn't there a big house price crash in the early 90s? And before then, people were leaving the city in the 60s-80s. In some ways, the current situation makes me think about life before affordable transportation. You had to live close to where you worked, which put the cost of housing up, and everything else (since all the people running business had to live nearby too increasing their costs). When things like the subway, and buses were invented in the late 19th century it made a massive change to most people's cost of living. I'm not sure what's going to help now though.

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  • I think part of it is that we now pay for things that we didn't have in the past: cell phones, cable, bottled water, Starbucks, etc. I think people eat out or purchase convenience foods more often. Vehicles cost more due to both safety features and luxury. It seems people don't stay home as much and just about everything they do costs money (if you have kids they are in sports and other activities that are not inexpensive, which is different that it was when I was a child).

  • I am reading Paul Krugman's “The Conscience of a Liberal” right now in which he also talks about the good years in the 1950s and 1960s when income disparity was the lowest in American history. Most Americans have not gained much in the tremendous boom that started in the early 1970s. Many have even lost income. Only the (super)rich have really benefited.

  • It's happening everywhere.
    Even here in Vancouver, I now pay $6.50 or more for a pint of beer.
    It's funny how a pint of beer is actually a great economic indicator.
    Prices have just risen out of control … I certainly hope they come down to earth more.

  • It's happening everywhere.
    Even here in Vancouver, I now pay $6.50 or more for a pint of beer.
    It's funny how a pint of beer is actually a great economic indicator.
    Prices have just risen out of control … I certainly hope they come down to earth more.