The Changing Landscape of Economic Progress

It seems that former President Trump has invested up to $25 million in a fund that most people might not even recognize. It pays him quite significantly, around $250,000 each month.

In my in-depth exploration of this fund, I stumbled upon insights that could really shift how we view retirement planning.

Just recently, we touched on the trend of decreasing costs for most goods in the U.S. from 1980 to 2020, based on the labor hours worked. But, under the Biden administration, inflation spiked like we haven’t seen in 40 years, driven by deficit spending, very low interest rates, and disruptions in global supply chains.

Nevertheless, there’s a bright side; by the end of 2024, the cost of time is expected to drop, continuing a long-term trend. Between 2000 and 2024, the Consumer Price Index shot up by 82.2%. Yet, during that time, wages for blue-collar workers increased by 115.1%, surpassing inflation by more than 40%.

This indicates that by the end of 2024, people could buy 18.1% more goods and services for every hour they work compared to the year 2000. That’s something worth noting, though not something you’d typically see in mainstream media.

Unlike money, time doesn’t fluctuate in the same way. Everyone has 60 minutes in an hour and 24 hours in a day. It’s our most valuable resource, something that can’t be stored, duplicated, or reclaimed. Over decades, as the cost of time decreases, it enables us to acquire more products and services.

People often gauge their income against those who earn more, but they often fail to see just how much more they can achieve now compared to the past with similar work hours.

Time prices serve as a unique benchmark for comparing wealth across different eras. Their decline isn’t about having more material resources; it comes from the enhancement of knowledge that allows us to use what we have more efficiently.

It’s a fascinating reality, albeit not understood by many. Fewer working hours alongside greater personal freedom is proof that many Americans are making strides toward their dreams, perhaps without even realizing it.

Most of us assume our quality of life will keep improving long-term. There’s a widespread belief that progress and increased wealth have been constants throughout human history, but history actually doesn’t support that notion.

For instance, if we could somehow transport Cicero, the Roman statesman, to Monticello to meet Thomas Jefferson nearly 1,800 years later, he’d find a familiar scene. Both would have used horses for travel, relied on fire for heat, and read by candlelight. Even Jefferson’s home life mirrored that of ancient Rome, with a similar struggle for survival.

Sadly, many of Jefferson’s children didn’t survive infancy—a reality that echoes throughout much of human history. Furthermore, with only a handful of technological advancements over that time, life in 1800 bore a strong resemblance to that of 2,000 years earlier.

However, since then, there’s been an explosion in human progress. Economic historian Deirdre McCloskey refers to this era as the “age of the millionaires,” marking a time of extraordinary wealth generation that has only accelerated in the last two centuries.

The impact is apparent in transport quality, communication speed, labor-saving solutions, and the abundance of luxury goods available at our fingertips.

Jefferson lacked modern amenities like electricity, automobiles, or the internet, essential tools that contribute to the standard of living we enjoy today. So, what’s driving this remarkable surge in our wealth?

Two key elements: freedom and the sheer number of people. Freedom fosters innovation, allowing individuals to create and profit from their ideas. That’s why goods and services tend to be less expensive in free societies compared to places like Cuba or North Korea.

This isn’t purely about freedom, though; it’s also about the power of numbers. More people contribute ideas, which amplify results, and when those ideas can be shared, everyone benefits.

The more liberated a society is, the greater the value of time. More individuals translate to richer outcomes.

Take agriculture; we’ve boosted our food production by improving yields significantly, with only a small fraction of the U.S. population involved in farming now. Advanced use of fossil fuels has revealed oil and gas reserves, with much of the earth still unexplored.

Rather than being a threat, a growing population enhances our potential. Yet, for years, students have been taught that more people will deplete resources. That simply isn’t the case. The abundance of resources is outpacing population growth.

Our economy can produce more goods and services while utilizing fewer resources than ever. For instance, from 2014 to 2024, U.S. GDP may have risen by 27.6%, while energy consumption slipped by 1.3% during the same timeframe.

Western nations have become adept at maximizing energy efficiency while reducing greenhouse gas emissions. As we transitioned from wood to coal to oil and gas, we significantly decreased carbon emissions from energy sources.

Today’s average American can acquire food in mere minutes, and grocery stores offer more choices than ever before. We have astonishing access to products and services while working fewer hours to afford them.

Life today is richer compared to decades past, but some pessimists refuse to see it, continually proclaiming doom is just around the corner. This mindset can blind many to the advantages of modern living, fostering a belief that decline is inevitable.

Don’t fall for that rhetoric, particularly claims regarding “overpopulation.” The most critical resource today isn’t oil or minerals; it’s people. Each individual utilizes intelligence and creativity to enhance available resources.

Growing the population doesn’t just increase demand; it drives growth and prosperity and provides a wealth of ideas and productive energy.

This capacity must not be underestimated, nor should the potential to enhance our time budgets be ignored. The more time you allocate to meeting life’s basic needs, the more opportunities you have to pursue your true passions.

This transition isn’t merely about wealth; it’s about abundance and recognizing that the American Dream remains vibrant for those willing to see it.