This blog post by Paul Campos is background to our ongoing discussion of economic and social history. The global human population grew very slowly from 8,000 BC until the 18th Century, while per capita income remained essentially stagnant. As I noted, people did not recover their pre-agricultural stature until the 20th Century. But the explosion in wealth since the 18th Century has been staggering, although we take our present circumstances for granted:
Consider that, to the extent such things can be measured, it appears that the per person economic output of the United States today is nearly sixty times greater than it was when George Washington became president. How rapid this change has been in historical terms is illustrated by the fact that John Tyler, the tenth US president, was born in the year Washington became the first president, and still has a living grandchild. I’m pretty confident that if you had told George Washington that 230 years hence Americans would on average be sixty times wealthier than they were at the moment, he would have imagined that nobody in that society would be poor. Yet here we are.
Another cognitive difficulty we face is that the human mind isn’t very good at grasping exponents. This is a thought experiment that I find useful: If an ATM machine is spitting out exactly one dollar per second, you need to stand in front of it for eleven and half days to become a millionaire. Meanwhile you would need to stand in front of it for nearly 32 years to become a billionaire, The gap between eleven and a half days and 32 years seems far far greater than our sense of the gap between a million and a billion. And here’s the kicker: you would have to stand in front of that machine for 1,743 years to become as rich as Mike Bloomberg, and 5,833 years to become as rich as Jeff Bezos.
Note that per person economic output in this case is mean income, not median. The material circumstances of the poorest among us are no doubt somewhat improved over 1789, but not by much. Keep in mind that the sorts of debates we are having now about social and economic policy would be complete inconceivable just a couple of hundred years ago. We'll go into more detail anon.