What I'm saying, and a big component of what I'm thinking about is housing costs, is that we're chasing the same things with more dollars. If household incomes double, expect the price of houses to follow suit. Assuming supply doesn't change, it doesn't help to earn 2x the money when all the bidders in the marketplace also have 2x the money.
you're missing the part where more demand creates more supply.
Sure, sometimes the market is distorted due to zoning, like in SF, and also land is finite, but generally speaking the market responds to the added demand by creating more housing, possibly denser housing. Same with other goods. Those are not empty dollars that got added into the system by fiat - they represent additional productive work done, and the goods / services they create is added to the economy.
My point is that I think the supply side isn't keeping up. The economy itself isn't bringing home 2x the bacon, but rather 1.5x the bacon when you're feeding all this extra labor into it. And yes, this is due to market distortions and diminishing returns.
The choice to sacrifice wages for more time with your kids is a luxury good, even if people choose to spend some of that time doing housework.