The Poverty of Affluence. Paul Wachtel

generations, whether homes, cars, or other accouterments previously thought essential markers of success and the good life.²³ They are also more likely than previous generations to prefer living in places that are walkable and/or have good public transportation,²⁴ patterns which place less severe strain on the environment and the climate. Whether these departures represent the beginnings of a genuine shift in our way of life or temporary accommodations to a difficult economy is a subject of debate and remains to be seen. But if this new edition of The Poverty of Affluence can in any way contribute to solidifying these encouraging signs of change, I will be especially delighted to be reaching a new generation with its message.

      ^* Strictly speaking, personal computers were already being sold, but relatively few people yet had them; and none of them connected to the internet, which also did not yet exist.

      ^* In standard economic theory, such miscalculations of what will bring us satisfaction or well-being (“utility”) are treated as essentially impossible (see Thaler, 2015). I will be discussing below the emergence of behavioral economics, in which the limits of human capacity to make rational decisions about the myriad choices life offers us are much more realistically considered.

      ^* See, in contrast, the work of Robert Frank, one of the leading economists to challenge the assumption that only the absolute quantity of goods matters and that comparisons with others are irrelevant.

      ^* The reader is likely to be wondering at this point what will happen to incomes if working hours are reduced. I shall address shortly the issue of incomes and access to goods in a world of shorter workweeks.

      ^* It has been argued by a range of experts on the topic that in fact, one reason business leaders became receptive to the reduction in hours was that they recognized that productivity did not increase with much greater working hours because workers who were tired, bored, or angry did not work all that well or efficiently.

      ^* Unemployment insurance is a response already in our society’s portfolio, but it is temporary, stigmatizing, and generally maintains only a portion of the previous consumption.

      ^* I do not mean by this to suggest that income needs to be the central focus of taxation. Cornell economist Robert Frank for example, has offered detailed and thoughtful proposals for a strong emphasis on progressive consumption taxes as a better alternative. And numerous economists on both the left and the right have advocated various forms of carbon taxes, which would have the virtue of promoting cleaner energy and contributing valuably to addressing climate change.

      ENDNOTES

      1. Amy Chozick, “Middle Class Is Disappearing, at Least From Vocabulary of Possible 2016 Contenders,” The New York Times, May 12, 2015.

      2. United States Census Bureau, “Median and Average Square Feet of Floor Area in New Single-Family Houses Completed by Location,” https://www.census.gov/construction/chars/pdf/medavgsqft.pdf

      3. Edward N. Wolff, “Recent Trends in Household Wealth in the United States: Rising Debt and the Middle-Class Squeeze,” Working Paper No. 502, The Levy Economics Institute of Bard College, June 2007, p. 11.

      4. Emmanuel Saez and Gabriel Zucman, “Wealth Inequality in the United States since 2013: Evidence from Capitalized Income Tax Data,” National Bureau of Economic Research, Working Paper No, 20625, October 2014.

      5. Ibid.

      6. Christina Larson, “The World’s 85 Richest Are Now Worth as Much as 3.5 Billion Poorest,” Bloomberg, January 20, 2014, https://www.bloomberg.com/bw/articles/2014-01-20/the-worlds-85-richest-now-worth-as-much-as-3-dot-5-billion-poorest.

      7. Noam Scheiber and Dalia Sussmana, “Inequality Troubles Americans Across Party Lines, a Poll Finds,” The New York Times, June 4, 2015.

      8. Paul Watchel. The Poverty of Affluence (New York: The Free Press, 1989), 68.

      9. Larson, “The World’s 85 Richest Are Now Worth as Much as 3.5 Billion Poorest.”

      10. Daniel Gilbert. Stumbling on Happiness (New York: Vintage, 2007).

      11. Richard H. Thaler and Cass R. Sunstein. Nudge: Improving Decisions About Health, Wealth, and Happiness (New Haven: Yale University Press, 2008).

      12. Ford Motor Company, “Henry Ford’s $5-a-Day Revolution”, Ford, January 5, 1914, http://corporate.ford.com/company/history.html; Jonathan Grossman, “Fair Labor Standards Act of 1938: Maximum Struggle for a Minimum Wage,” Monthly Labor Review, U.S. Department of Labor, June 1978.

      13. Truckinginfo.net, “Trucking Statistics: U.S. Statistics,” http://www.truckinfo.net/trucking/stats.htm; Michael A. Miller, “Post-Job World Requires Big Thinking, Part I Of II,” Long Island Weekly, September 16, 2015, http://www.longislandweekly.com/post-job-world-requires-big-thinking-part-i-of-ii/.

      14. See for example, Erik Brynjolfsson and Andrew McAfee, Race Against The Machine, (Digital Frontier Press, Lexington, MA, 2012); John Markoff, “Skilled Work Without the Worker,” The New York Times, August 19, 2012; Derek Thompson, “A World Without Work,” The Atlantic, July 2015.

      15. See, for example, Scott Winship, “For the Last Time, Robots Do NOT Cause Unemployment,” Brookings Economic Studies Bulletin, July 16, 2013; Mark Mills, “Robots Do Not Create Unemployment,” Real Clear Markets, September 2, 2014.

      16. Steven Greenhouse, “Our Economic Pickle,” The New York Times, January 13, 2013.

      17. Thompson, “A World Without Work,” The Atlantic.

      18. See, for example, Joseph R. Blasi, Richard B. Freeman, and Douglas L. Kruse, The Citizen’s Share: Reducing Inequality in the 21st Century, (New Haven: Yale University Press, 2013).

      19. “CEO-To-Worker Pay Ratio Ballooned 1,000 Percent Since 1950: Report,” Huffington Post, April 30, 2013, http://www.huffingtonpost.com/2013/04/30/ceo-to-worker-pay-ratio_n_3184623.html

      20. John Kenneth Galbraith, The Affluent Society (Boston: Houghton-Mifflin, 1958).

      21. See, for example, Paul Watchel, Relational Theory and the Practice of Psychotherapy (New York: Guilford, 2008); Paul Watchel, Therapeutic Communication: Knowing What To Say When, Second Edition, (New York: Guilford, 2011); and Paul Watchel, Cyclical Psychodynamics and the Contextual Self: The Inner World, the Intimate World, and the World of Culture and Society, (New York: Routledge, 2014).

      22. Paul Watchel, Race in the Mind of America: Breaking the Vicious Circle Between Blacks and Whites, (New York: Routldege, 1999).

      23. Josh Allan Dykstra, “Why Millennials Don’t Want To Buy Stuff,” Fast Company, July 12, 2013, http://www.fastcompany.com/1842581/why-millennials-don’t-want-buy-stuff Darren Ross, “Millennials Don’t Care About Owning Cars, And Car Makers Can’t Figure Out Why”, Fast Company, March 26, 2014, http://www.fastcoexist.com/3027876/millennials-dont-care-about-owning-cars-and-car-makers-cant-figure-out-why; Jordan Weissmann, “Why Don’t Young Americans Buy Cars,” The Atlantic, March 25, 2012, http://www.theatlantic.com/business/archive/2012/03/why-don’t-young-americans-buy-cars/255001/; Brad Tuttle, “The Great Debate: Do Millennials Really Want Cars, or Not?,” Time Magazine, August 9, 2013,