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Comment by rendall | Hacker News Reader

If I'm reading this correctly, Mrs. Laing paid £17 out of her annual income of £225 to rent her home, so 7.5% of her income. That seems astonishingly low, to me. Admittedly, I'm used to NYC rental prices, which are expected to be 1/3 of income, but isn't 7.5% very low everywhere?

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I think we have to consider prior background here, and look at her income.

She was a widow of one William Christie Laing, a surgeon. Her late husband had subscribed to the Bengal Military Orphan Society for 23 years. So, presumably, he was part of the military, and as a surgeon, held a rank that would have yielded a sizable stipend.

According to the article, she received a £225 widow pension from the Bengal Military Fund. So, is this a sizable pension, or mere charity pushing her into "extreme penury" per her own assertion? One could assume that rank and years served by her late husband would have propped up her pension beyond what a widow of a common soldier would have received. Or even a common laborer who didn't came from wealth at all.

In that regard, rent wasn't her particular issue. Relinquishing her former lifestyle in order to maintain her 7 children was. Sure, the reduction of her income had a serious impact. But how does it compare to actual poverty levels at the time?

Just 3 years later, she had moved out to a different place and was living with 4 of her children. So, clearly, her financial situation did improve during that period of time. A dynamic that generally wasn't - and still isn't - all that self evident for someone who already belonged to the lower social classes.

yes, according to officialdata.org, 225 pounds in 1860 would be approximately 30,000 pounds today [1]. Admittedly, not enough for a family with seven children, but an annual income of 30,000 pounds is hardly "extreme penury" except for the really well-off. I agree that perhaps the real issue was the cost involved in bringing up and educating her children. Even with all this misfortune, all of them seem to have done well later.

[1] https://www.officialdata.org/1860-GBP-in-2017?amount=225

That's slightly higher than minimum wage in the US.

The minimum wage of about $7.25 per hour, 40 hrs per week, 52 weeks comes to $15,080 which is around 12,000 GBP. So the pension is 2.5 times the minimum wage level. Please note: I am not attacking the article or the poor lady - I am just pointing out that what sounds like a paltry sum (225 pounds in 1868) is nearly lower middle class income today, and not penury.

It's true that the US minimum wage is far less than what Ms. Laing received.

Two things to keep in mind though. First, despite the Federal minimum, many states and localities have much higher minimums, for the reason that the Federal minimum is insufficient to live off of in many places. For example, San Francisco, has a minimum of $16.99/hr. or about £29,265 p.a., very close to Mrs. Laing's pension.

Second, whether it's the Federal or San Francisco minimum, it's at best barely sufficient even for a single person. Mrs. Laing had a family of eight people. The US national poverty threshold for a family of 8 is $40K (£33,249) [0], so her by those standards her family would indeed be very poor.

[0] https://aspe.hhs.gov/topics/poverty-economic-mobility/povert...

Yearly salary for a skilled worker in the US was around $700/£140 in the 1860s was in England it was around £100 or even less. So in that context £225 is not that bad.

Being the minimum wage 7.25 an hour, wouldn't be yearly around half of that number?

(Foreigner here, I don't have the minimum wage in the US super clear)

You are right I was thinking household (2 adults working).

Agreed. While that translates into 30k pounds today, one has to also factor in the cost of living in Bengal at the time.

While she rented in a poor area, would 17 pounds have been on the high end or low end for the kind of living quarters it got her? What were the price levels in general for food, clothes and so on? You'd have to look at rent levels in that area at the time to make an accurate assertion.

> Even with all this misfortune, all of them seem to have done well later.

They clearly did. One unanswered question is what the intentions were behind her petition to take her children on the Bengal Military Orphan Society. Was there a real hard pressure to take such a drastic measure? Or was this a desperate plea in hopes of drawing attention and financial help from elsewhere e.g. erstwhile social circles she frequented?

Ultimately, the article does mention that the petition was denied, yet doesn't answer how she made ends meet in the following three years before the family moved again.

Monetary conversions across such a broad stretch of time are nearly useless. Food, clothing, housing, etc were all under vastly different price pressures, and many modern "essentials" didn't even exist (and vice-versa).

The fact her children are were taken out of school seems to be the biggest impact IMO.

From speaking to older family members, rent and home ownership used to be a much lower proportion of spend relative to food, clothes, furniture etc. Now many of those items are mass produced and are cheaper. There has been an inversion.

Food used to be the dominant part of a household budget, it's now essentially trivial in comparison to other items.

> Admittedly, I'm used to NYC rental prices, which are expected to be 1/3 of income

Is that 1/3 of the total gross pay or is that 1/3 of total net pay?

I presume 1/3 of the total gross pay goes in deductions. So 1/3 of total gross pay is 66% of total gross pay. But 1/3 of total net pay is more like 22% of the total gross pay. And that's a big difference. I'd appreciate clarification about which one of these are the NYC rental prices more like.

I think both the percentage of income and effective tax rate vary wildly with income so it's probably not worth trying to nail down a specific percentage

>7.5% of her income

Wouldn't it be better to use expenditure instead of income? As an example, my rent is 40% of my expenditure. Couple of years back, my income was just enough to cover my bills. Now I've more than doubled that income. But 40% of expenditure for rent is roughly the same even now.

> ... 7.5% of her income. That seems astonishingly low, to me.

You've fallen victim to presentism, the cognitive bias of assuming the past was like the present.

Before the 20th century, households spent a far higher proportion on their income on food and on fuel (for space heating, cooking, lighting) than we do today. Clothing and footwear also loomed large in the budget. Housing used to be a relatively smaller cost than these.

7.5% is possibly on the low side for the time, but not astonishingly so.

> You've fallen victim to presentism, the cognitive bias of assuming the past was like the present.

Is pointing out something in the past as not like my experience "assuming the past was like the present"?

I would pay around this number if I would be renting my current apartments. My salary is significantly higher than average though.

That's still achievable if you earn well (like a software developer), have two incomes and pay a low rent (e.g. in Europe).

the demographics are very different: if all you're looking at is the cost of construction, with no scarcity factors, then one third looks astronomical: once built, the building stays built, maintenance + profit cant be that high...

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