Christmas dinner in America has become more affordable, and that's something we can all appreciate.
Norse Gods and Yule Ham
For millions of people who sat down to Christmas dinner yesterday, the Christmas ham was on the menu. Consumption of the Yule Ham, as Christmas ham is also known, seems to have originated as an offering to Freyr, the Norse god of harvest and fertility. Freyr, apparently, was partial to boars and possessed one, called Gullinbursti, made entirely out of gold. The pagans, it seems, left us not only the Christmas tree, but Christmas ham as well.
I start my Christmas missive with ham for two reasons. First, Professor Gale L. Pooley from BYU-Hawaii and I have finished the first draft of our upcoming book on population and resources. And that’s as good a Christmas present as any to the both of us. Second, in addition to many other interesting things, our book looks at the U.S. prices of 42 common food items between 1919 and 2019. Mirabile dictu, ham is one of them. What did we find?
Between 1919 and 2019, the average nominal hourly compensation rate of a U.S. blue-collar worker rose from $0.43 to $34.33 or by 7,884 percent. The nominal price of a pound of ham rose from $0.57 to $3 or by 426 percent. That means that the Time Price of ham (i.e., nominal price divided by nominal wage) declined by 93 percent. For the same amount of work, a blue-collar worker could buy over 13 times more ham in 2019 than he or she could buy in 1919. The abundance of ham increased at a compound annual rate of 2.69 percent and doubled every 26.11 years.
Over the same period, the population of the United States rose from 104.5 million to 328 million, or by 214 percent. Yet, the average Time Price of the 42 food items that we analyzed fell by 91.2 percent (relative to blue-collar compensation). The math-savvy reader knows that a 50 percent reduction in price allows the buyer to buy 2 items for the price of 1. What about a 91.2 percent reduction in price? That allows the buyer to buy 11.32 items for the price of 1 (for more, see the Figure below).
The abundance of food relative to blue-collar compensation increased by 1,032 percent (2.46 percent per annum, thus doubling every 28.6 years) – almost 5 times faster than population. Astonishingly, the share of American workers employed in agriculture has fallen from 41 percent in 1900 to less than 2 percent today, thus freeing U.S. workers to acquire those better-paying blue-collar jobs in the first place.
Of course, I realize that the above discussion has led me far away from Yule ham, let alone Freyr and his Gullinbursti. But there is a lesson here (at least I hope there is). America’s prosperity did not come about thanks to a Norse deity overseeing our “harvest and fertility.” It is the result of hard work, ingenuity, and a desire for self-betterment. Those are, in turn, supported by our albeit-imperfect, but largely effective political and economic institutions: liberal democracy and free enterprise. A greater appreciation of those institutions would be a nice Christmas present to America.
Figure: Time Price analysis of the 42 U.S. food items relative to the U.S. blue-collar compensation