World’s best things are no longer only for the rich
The traditional orange at the bottom of a Christmas stocking dates to a time when this was the only orange a child might receive all year. Earlier, in the 17th century, a single pineapple might cost the equivalent of £5,000 today; like pepper in the Middle Ages, pineapple ownership was confined to royalty and the super-rich. Yet recently I spoke to someone who had worked in a food-waste processing plant. She said their worst nightmare was when one of the supermarket chains offered two-for-one on pineapples; so many people would throw away their unwanted second pineapple that the extra acidity played havoc with the chemical workings of the plant.
The last 40 years or so have seen something very strange: a dog that doesn’t bark in the night. In short, nobody has invented anything of any significance which is prohibitively expensive. This is unprecedented. For almost all of previous human history, anything new and amazing has been in short supply, and hence mostly confined to the rich.
As a doctor in a mining town, my grandfather could afford lots of things that were out of reach to most people around him. Fridges, radios, a dishwasher, foreign travel and, above all, a car. I don’t know what the Welsh Gini coefficient was back then, but certainly being 10 times richer than average allowed you to buy many things which were off-limits to everyone else. To understand inequality in my grandfather’s era, imagine a world where broadband Internet access cost £500 a month and a mobile-phone handset cost £2,000. We are sensibly concerned when people in rural areas are denied fast broadband — but it’s nothing to a world where only 10 per cent of people could afford a car.
Andy Warhol once approvingly said that “America started the tradition where the richest consumers buy essentially the same things as the poorest… You know that the President drinks Coke, Liz Taylor drinks Coke, and just think, you can drink Coke, too. A Coke is a Coke and no amount of money can get you a better Coke than the one the bum on the corner is drinking. All the Cokes are the same and all the Cokes are good.”
Today, because most innovation has recently taken place in the field of software, media and entertainment, where the marginal cost of production is almost nil, far more modern goods are of a kind where the rich can’t “get a better Coke” than anyone else. As far as I know, there isn’t a really expensive mobile-phone network for plutocrats, for instance.
This does not mean a problem with inequality no longer exists. In fact, I would argue that the fact that more and more value is being created in networked goods argues for more redistribution of wealth, not less; put simply, if you want good restaurants, airlines, taxi services, mobile coverage, distribution services, broadband and so forth, you are more likely to get them in a country with a large number of fairly prosperous people.
But that’s only part of the problem. The other part of the problem is psychological — that we tend to discount the value of things which are cheap and abundant — or, to use economic language, we don’t derive much pleasure from the consumer surplus. As Alain de Botton remarked, once pineapples became cheap they also became disposable. What was once a prized miracle fruit was thrown away — or, worse still, put on top of a pizza. The practice of saying grace before a meal is an excellent idea: perhaps there should be a technological equivalent. By arrangement with the Spectator