The deeper point is that things are getting cheaper and cheaper, and people — services provided with their expertise — are getting more and more expensive.
He points to an NYT chart showing plummeting prices for goods and soaring prices for education, health care, and child care.
My view is that a lot of spending on these services is discretionary (not all of it, of course). I think this makes any broad statement about “the” real wage incorrect. See my essay on that topic.
I don’t think this statement is all that controversial. It is also true in the cross section as well. My indian classmates say that families in India with a comparatively modest income (relative to the US) have one or more servants. My Brazilian neighbor upon returning from a visit home said exactly this: In Brazil people are cheap and things are expensive. In the US it’s the opposite.
Fundamentally, isn’t this just the same reason that a barber, who for decades (centuries?) has not increased productivity, has enjoyed an ever increasing standard of living. I guess it’s partly because we’ve not yet figured out how to apply capital in the service sector the way we have in the production of stuff.