“Those who ignore history are doomed to repeat it”- George Santayana, 19th Century writer, philosopher
Have you ever driven through an old neighborhood where the houses were mostly constructed in the 1920’s?
What did you see? What you saw from that era of American consumption is very large homes; Bungalow styles, Colonial revival, Ranch style and others. In Seattle the Leschi neighborhood and the area east of Franklin High School give adequate representation of the kind of opulence home owners enjoyed in the time of Prohibition,
Calvin Coolidge, and a rising stock market.
History being our teacher we look back on that time and know what followed; a record stock market crash, increased taxes from the Federal Government and a depression that shook the foundation of our country. So what do you see in the neighborhoods where the houses were constructed in the 1930s? The answer is nothing. There are no neighborhoods built in the 1930s. Like today construction ground to a complete halt because of the depression leaving nothing to look back on.
World War II took us out of the depression, but because of the diverting of resources home construction didn’t recover in this country for five more years. When it resumed in the late 40s and continued through the 50s and 60s what was being built? The Lake Hills community in Bellevue, WA is a fair representation of late 50s early 60s construction. I grew up there.
With very few exceptions it’s a community made up almost entirely of ramblers with a size seldom exceeding 1200-1500 square feet. They were easy to construct and inexpensive. And the Eisenhower and Kennedy 50s and 60s gave America a universal image of happiness and wealth. In my case I thought my house was a palace growing up. After my parents divorced our single parent home, led by my Dad, became a 1100 square foot rented duplex. The whole neighborhood was duplexes, so once again I didn’t feel deprived.
Slowly through the 70s the houses got bigger, introducing the God-awful split-level
. But even these were generally no more than 2000 square feet.
By the time the 90s come around everything has exploded.
Newly constructed homes have to have a minimum of three bedrooms, laundry room, office, play room and foyer. The home I grew up in would be swallowed by my current homes downstairs alone. And with the added size came an awful lot of opulence too. Granite countertops now are staples in even the most humble abode. In the past 20 years we’ve furnished these McMansions with leather furniture and tile floors. And if our home didn’t have the amenities we desired we would refinance our mortgage or get a second mortgage, taking equity out of our personally largest investment. Taking equity out of your home was something our parents and grandparents wouldn’t dream of doing except in the most dire financial emergency. Now we do it to finance a trip to Cancun.
The 2008 financial collapse was largely caused by an increasing number of Americans failing to pay their mortgage; mortgages for big, opulent homes too many flat-out couldn’t afford. But creative financial instruments were put before us and Presto! We could suddenly afford these ridiculous houses. The dreaded ARM loan became a buzz word and the source of all our consternation. Nobody put a gun to anyone’s head asking them to sign these unwise financial documents. But like lemmings lining up for our own fatal plunge Americans from every corner of our nation made the dive.
The expenses our parents faced on a monthly basis included a rent or mortgage payment on a fixed-rate 30 year mortgage. They included heating bills, water, sewer, life insurance, car insurance, phone, food and gas. It included little else. Today all those expenses have exploded. Gas prices have doubled just since Barrack Obama became President. Also now our monthly expenses include all of what’s just been mentioned PLUS cable tv, internet, DVRs, cell phones
, workout-clubs or gyms, video game networking, 50 inch TVs and more. And these are just regular monthly expenses. These are expenses earlier generations couldn’t fathom; nearly all of them unnecessary extravagances. Can you say with a straight face that you honestly NEED 200 different television channels? Is it really necessary that each individual in the household be available for a telephone (cell phone) call 24-7? We have five different telephones in my four person home. We could have six but I fought my wife against getting our 13-year-old daughter her own phone.
When dollars are tight and the bills aren’t being met too many enviously scream at those who have more and shout “No fair!”. But when you look around at what even the poorest in our society enjoy compared to our forefathers, and compared to the rest of the world, for that matter, shouldn’t the finger of blame be pointed at the man or woman in the mirror when cash flow is not there for you? Doesn’t history show us that when you build up and up and up and live beyond your means a correction is inevitable? And doesn’t history tell us that living humbly coincided with happy times and progress for our society?
I don’t wish anyone to live uncomfortably. I want us all to have a rich and fabulous existence. I want us all to thrive. I’m just saying thriving could be a lot easier if we look back from whence we came.
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- How the middle class aided its own decline (seattletimes.nwsource.com)
- McMansions: That dirtiest building trend of them… (curbed.com)
- What You Need To Know Before Applying For A Mortgage (choiceofhomes.com)
- When Kids Should Get Cell Phones (droppedonherhead.wordpress.com)
- Middle-Class Homeownership Dream May Be Slipping Away (huffingtonpost.com)
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