“it takes two incomes”
Outstanding post:
http://booksbikesboomsticks.blogspot.com…
One of the rallying cries of the Populists who have infested both parties is the slump in the earning power of the American wage earner. For whatever reason, the modern American family seems to require two working adults. While the dollar’s decline has something to do with the fact that the Cleavers can’t get by on Ward’s salary alone anymore, there’s one other factor that everyone seems to leave out. Take this pop quiz and see if you can guess what that factor is:
1) The balance on Ward Cleaver’s three most frequently used credit cards is?
2) Does Wally have an Xbox3 hooked to a flatscreen TV in his room, or is he making do with an old Play Station hooked to a hand-me-down 19″ Sony?
3) In addition to electricity, water, and the telephone, the Cleaver’s largest monthly bill is: a. Cellular Service, b. Cable TV, c. Broadband Internet Access, or d. Late Fees At Blockbuster.
4) The Cleaver’s timeshare is in: a.) Destin, or b.) Gatlinburg.
5) June’s bread maker was made by: a.) Sunbeam, or b.) Krupps.
6) The amount of money Ward loses annually playing Powerball, Online Slots at home, and Texas Hold ‘Em on vacation in Branson, Missouri is: $____ (Round to the nearest dollar.)
Families who want to have two incomes should. Families who want to have one income should. And, in case we’ve got any Davis Square folks reading, “triples” and “quads” who want to have three or more of their “primaries” working should do that too.
…but spare me the Pat Buchanan / Ted Kennedy lamentations about how everything sucks.
It doesn’t. You do.
December 4th, 2007 at 12:06 pm
With respect to the “it takes two incomes” idea, I’ve often wondered if it isn’t the case that more families /decided/ to have two incomes because, for reasons other than need of the income, women wanted to work outside the home, and the economy merely adjusted to the trend?
December 4th, 2007 at 12:58 pm
Well, I only have the one income because there’s only the one of me, but I freely admit that if there were two of me, we’d need the two incomes to keep me in the style to which I have become accustomed. ;)
December 4th, 2007 at 1:19 pm
I saw an interesting analysis (done by Stossel I think) where a woman worked full time earning about $45K to help support her family. They figured out the costs associated with her working- taxes, daycare, wardrobe, car/commuting etc and in fact her working not only added no additional income to the family, but required some of her husband’s to support it. I wonder how many people actually do the math.
December 4th, 2007 at 1:33 pm
[quote comment="106945"] I wonder how many people actually do the math.[/quote]
We did. That’s why I’ve been a full-time Dad for 10 years now.
December 4th, 2007 at 2:09 pm
[quote comment="106944"]if there were two of me, we’d need the two incomes to keep me in the style to which I have become accustomed. ;)[/quote]
LOL!
December 4th, 2007 at 5:55 pm
I wonder how many people actually do the math.
My wife’s job as a private school teacher was brining in enough money for daycare, a payment on her car and enough left over to buy a cheap dinner.
Dallas ISD would have paid more but with a longer commute.
Funny how home-schooling became attractive after that.
December 4th, 2007 at 11:50 pm
I understand the idea of a job that costs more money than it brings in, because it forces the expenditure of some $N of after-tax money (pre-tax if you have a DCSA), but I’m having trouble choking down the idea that the threshold of effectiveness lies at or above $45K/year – Median household income was $46K in 2005.
How many kids did that family have? I can believe it if they had 5 or 6 kids, 3 or 4 of them under school age and requiring $500/mo in daycare, but that’s hardly a typical family.
December 5th, 2007 at 12:45 pm
There was an article in the paper yesterday that discussed the same thing… Family falling behind on bills (including cable), mom doesn’t work because “child care would eat up all her earnings”, 3 or 4 kids, but only one under school age (product of current marriage). One child with osteogenesis imperfecta (from previous marriage to man with disorder), their bills paid from public assistance.
All this rested on the ‘career’ of her husband, a pizza delivery person.
Fortunately he’s got a much better job now; manager at a shoney’s or some such; perhaps the breeding could have waited until such time as his increased income created more financial stability for his family?
Nah.
December 12th, 2007 at 12:18 am
$45k is about $3k per month in additional income (using a 20% tax rate, which might be a bit low depending on how much the husband makes and the circumstances).
I’m always surprised when people include the cost of a second car in these kinds of calculations. I’m pretty sure that almost all households have at least 1 car per driver, regardless if both work.
December 12th, 2007 at 8:15 am
Not necessarily. One of my married friends (?) didn’t get their second car until recently. Her husband was making more reliable money by then (if memory serves), but also a single car wasn’t workable anymore after they had their daughter.
December 12th, 2007 at 8:29 pm
Economies adjust.
In an economy, there is generally more need for labor in production of goods and services required than there are able-bodied males to fill them, any time when a nation is not at peace (and a lot of soldiers, mostly men, are off fighting somewhere).
This is why Rosie the Riveter was Rosie the Required at an earlier point in U.S. history.
However, it is quite likely that in an economy, there is generally less need for labor in production of goods and services than there are able-bodied adults of BOTH genders to fill them.
This is especially true as technology advances and makes the term “able-bodied” rather more broad. (I.e. the difference between the physical effort involved to operate a 1900′s-era printing press and hock the copies on streetcorners, versus the physical effort involved in running 2000′s-era desktop publishing software and posting the result in PDF format on a website.)
It is reasonable to believe that as a large portion of women entered the workforce, the incomes of individual workers dropped. After all, the supply had increased; given a glut of workers looking for work, one expects each individual worker to be less sought-after, and therefore paid less.
This is not to say that the average dame ought to go home “and make me a sammich, where y’ belong, woman!” At least one advantage of the combined workforce is the increased productivity of the society overall; another may be higher overall standards for social skills in certain workplaces where previously the relationship between management and personnel consisted of, “Work, or I won’t fire you, I’ll kick your a** and then fire you.”
But it’s a fact of life: When one product ups the ante (feature-wise) in a consumer-empowered marketplace, all the other products have to either up the ante, or charge less, or lose sales.
In the case of the married couple, if they’re not willing to offer the labor of both adults to the workforce (which represents as substantial feature-improvement over only offering one adult), then they’ll either be forced to “charge less” (i.e. be willing to be paid less in real income for their one worker) or “lose sales” (i.e. find that their one worker is unable to get hired because his salary requests are too high).
It’s not a matter of fair or unfair; it’s just economics in a competitive marketplace.
Therefore, a family that doesn’t get grandma to watch the kids and get the wife back in the workplace — or find some way to avoid cheap childcare if grandma isn’t available — is going to be in debt half of the time. If half the women currently in the workplace went home and raised kids, this might change. Since that isn’t going to happen, it won’t.
Keep in mind that some of us still think it’s worth it. My wife stays at home and homeschools our kids (since American private schools are priced outside of our reach and American public schools are tantamount to child abuse). We are therefore tight for cash all the time. We recently gave up cable T.V., and always keep our cars until they’re 12-15 years old; that helps. But there’s no denying it’s sometimes tough.
That’s life. It’s a fallen world, an’ what’reya’ gonna do?
December 13th, 2007 at 1:12 pm
Opportunity costs…
Based on my salary, family member appropriateness for childcare, and personal inclination:
it is much cheaper for me to work and pay someone to watch my kids part-time.
Since I don’t like the free education from public school, and I don’t think that I’d do a particularly good job either, I am also willing to pay someone to teach my children.
If all of the above were different, then economics would drive my choices differently (net salary vs. cost/ availability of childcare, living in a different school district, having relatives I’d trust my children to, etc).
If you have insane amounts of money available, you have people who decide to “have it all”– lots of material possessions, purchased labor for childcare, purchased labor for education, personal leisure time.