Again, an objective measure is hard to find, but one easy way to get a sense is to ask: what would happen were this entire class of people to simply disappear? Say what you like about nurses, garbage collectors, or mechanics, it's obvious that were they to vanish in a puff of smoke, the results would be immediate and catastrophic. A world without teachers or dock-workers would soon be in trouble, and even one without science fiction writers or ska musicians would clearly be a lesser place. It's not entirely clear how humanity would suffer were all private equity CEOs, lobbyists, PR researchers, actuaries, telemarketers, bailiffs or legal consultants to similarly vanish.
The fact that private equity CEOs make more money than garbage collectors is about as much of a paradox as the fact that diamonds cost more money than water. Water is far, far more useful. Nobody ever died from a lack of diamonds. Water is essential for drinking, bathing, agriculture, and wet tee-shirt contests. Diamonds are comparatively dumb.
Water is cheap not because it provides less utility than diamonds, but because it's plentiful and therefore easy to acquire. Similarly, there are many more people capable of collecting garbage than there are of doing whatever private equity CEOs do. This is an important part of organizing resource allocation and the pricing mechanism that drives production in a capitalist economic system, but I don't really want to get into that right now. I mention it mainly because it's relevant to toothpaste and housing (discussed below).
I posted earlier that many people have to work full-time just in order to afford housing, health care, and education. These things have all become ridiculously expensive.
Here's a long article about it. (Side note: SSC is back up!!) From the article: "In the past fifty years, education costs have doubled, college costs have dectupled, health insurance costs have dectupled, subway costs have at least dectupled, and housing costs have increased by about fifty percent [in real terms]. US health care costs about four times as much as equivalent health care in other First World countries; US subways cost about eight times as much as equivalent subways in other First World countries."
What is making these things so ridiculously expensive, and thus requiring so many people to spend all their time working so that they can afford them?
It's a mystery. That article describes some of the commonly proposed reasons, then explains why none of them can be the full story.
I think that housing and education share an important feature: they are
positional goods. In your toothpaste example, if there are two toothpaste producers and toothpaste costs $1/tube to produce, and if you and I each have $1 in our pockets that we're willing to spend on toothpaste, we'll each be able to buy a tube. The price will be $1. If we each have $10 in our pockets that we're willing to spend on toothpaste, the price will
still be $1 because, in a competitive market, price = cost of production.
Housing doesn't work that way, though, because land doesn't really have a cost of production. There's a limited amount of it, and therefore a limited amount of housing. If you and I each have $100K we're willing to spend on a particular house, we'll bid the price up to $100K. If we suddenly have $1 million burning holes in our pockets instead, the price of the house will go up to $1 million. It's not like the toothpaste because the producer can't simply make more: there's a fixed amount, so the price is determined not by the cost of production, but by a bidding war.
This means that the government can't make housing more affordable by offering subsidies. The effect of the subsidy is to put $1 million in our pockets instead of $100K. But rather than making housing more affordable, that just makes it more expensive.
Education at elite (expensive) universities is similar to housing in that respect. There are a limited number of spots in Harvard's incoming class. Harvard can't really create more spots (without forfeiting its exclusivity, which makes it a different product), so there is, in effect, a bidding war for the fixed number of spots it has. As with housing, subsidies won't make Harvard more affordable: they'll just make it more expensive.
This makes spiraling housing and education costs a hard problem to solve. (Authorizing more housing construction would be a great first step -- though not in any particular community's backyard, of course.)
Health care has different problems, which are probably even harder to solve.
The upshot, though, is that housing, education, and health care, together, are eating up everything a normal wage-earner can afford with a full-time job. So working less than full-time is not an option for most people, even though 15-hour workweeks would otherwise be pretty sweet.