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Along with the relative decline in exhibitionistic spending has come a decline of the class that practiced it. Compared to 1929, the $100,000-plus income group (after taxes) today is less than a fifth as large, accounts for only a sixth of the aggregate income it accounted for in 1929, provides only .038% of national luxury income v. more than a third in '29. But while the apex of the pyramid has shriveled, the middle has filled out: there are now 30.6 million families with personal incomes of $4,000 or over who account for a luxury income of $41.4 billion. In the words of a Los Angeles broker: "Before World War II there were at least 50 really big yachts here. Today there are only 15 left, but there are at least 3,500 smaller boats."
In this new mass market, old distinctions between luxuries and necessities have a way of disappearing fast, and yesterday's luxury becomes today's need. Thus, one day in January 1950, by federal fiat, the TV set was suddenly transformed in effect from luxury to necessity. This happened when the Bureau of Labor Statistics decided that TV sets belonged on the list of the hundreds of items it uses to compile its cost-of-living index. Three years later, by BLS "decree," automatic laundry service and biscuit mix also became necessities. It is easily conceivable that in time the same road will be taken by air conditioning, electric blankets, power steering, and a thousand other amenities. This is the familiar old American process of raising the standard of living.
It is also a new twist on the old historians' axiom: the more luxury, the quicker a nation degenerates. This was true enough in Babylon, Greece, Rome, Bourbon France and Czarist Russia, where luxury perched atop a pyramid of misery, ignorance and hopeless poverty—Fabergé eggs sprouting from a dungheap. But in the U.S. luxury has come to mean not a declining economy but an expanding one. It is not a historic nightmare but a large part of the American dream. In the words of Ben Franklin, who saw ahead of his time: "Is not the hope of one day being able to purchase and enjoy luxuries a great spur to labor and industry?"