Howard Hughes was one of the richest people in the world during his lifetime. He was also a bit of an eccentric guy (to say the least). But I recently learned an interesting fact about his life that puts into perspective how much richer we are today, in ways that simply cannot be conveyed by merely referring to GDP accounting.
Hughes was an insomniac and a movie buff. Unfortunately for him, late night programming was very limited. He wanted to have more options available for what he could watch during his sleepless nights. And with his considerable resources he managed to find a solution. He finished buy a TV station, KLAS, in 1967 for the price of $3.6 million, which today, adjusted for inflation, would amount to just under $34 million. Now that he had control of his own private TV station, he could ensure that movies were broadcast at all hours. And apparently it wasn’t uncommon for him to decide he didn’t like the show and simply call the station and tell them to play something else. As a result, everyone watching the channel suddenly became confused as the movie they were watching suddenly switched to something else.
Hughes was a rich man. But at the same time, he had to spend tens of millions of dollars to get a service that was far worse than what anyone with a Netflix subscription has available to them today. Hughes could have burned through his entire fortune without ever coming close to the staggering variety of entertainment that you and I can have today for a trivial amount of money.
If you look at Hughes’ net worth during his lifetime (even without adjusting for inflation!), he was a much richer person than me by all standard measures. But I would never be tempted to trade my current standard of living for the standard of living Hughes had during his lifetime. And 1967 isn’t exactly ancient history. You don’t have to look that far back to see that the luxuries of the richest people who lived a generation or two ago couldn’t even come close to what is so plentiful today that it could be considered trivial.
Now, if I were to suggest to someone that their grandchildren will have things beyond the reach of Elon Musk or Jeff Bezos with all their wealth today, they might think that’s a fantastic statement. But it’s a statement we can now accurately make about ourselves and Howard Hughes, or John Rockefeller, or any other wealthy person, even from a generation ago. So the next time you sit down on the couch and log into your Netflix account, take a moment to be grateful that you don’t have to live like Howard Hughes. When you turn on your air conditioning to take the edge off a hot summer day, be grateful that you don’t have to live like John Rockefeller. When you apply some antibiotic ointment to a minor cut, thank your lucky stars that your medical care is so much better than what was available to President Calvin Coolidge’s son, who died when a blister on his toe became infected. And be grateful knowing that your grandchildren will be grateful that they don’t have to live the way Elon Musk or Jeff Bezos live today.