The Life in the Simpsons Is No Longer Attainable
theatlantic.com
theatlantic.com
We Americans currently spend $4,000 more per person per year than other countries for healthcare, and we live 4 years shorter than them. For a family of 5, like the Simpsons, that's $20,000 per year. https://medium.com/numbers-that-matter/our-healthcare-system...
Because of industry consolidation, over the last 20 years, we Americans are paying an extra $2,000 per person per year for higher priced goods. And losing out on $800 per person per year on goods we don't buy because consolidation raised the price beyond what we'd pay. For a family of 5 like the Simpsons, that's worth $14,000 per year. https://medium.com/numbers-that-matter/monopoly-oligopoly-co...
Another major factor is housing. More people live in cities, but housing hasn't been created at the same pace. It drives up rents and housing prices. Some economists have measured the effect of housing in just San Francisco and New York and said it is worth _nationally_ on the order of $1,200 per person per year. That's just f*ed up.
So, even as wages have stagnated, that's not the whole story. Lower class people are actually worse off.
Why is it that $7.25 an hour would be a princely sum in Thailand or Costa Rica or the Czech Republic but is starvation wages in Tulsa or Jacksonville or Duluth? Most people think they know the answer to this question but it's a facile half truth that's doesn't stand up to much empirical scrutiny. Digging into the real cause is something that hasn't received enough economic attention because it gores the sacred bulls of both the left and the right.
Doesn't sound unrealistic to me for a guy making ~$35k presuming he got it even cheaper back in the day.
- it's not exactly in Springfield
+ it's new construction
- it's just under 2000sf
+ at $165k it's probably a lower payment than a mortgage on $100k in the 90s
...in the NE and west coasts. This isn't out of the ordinary in large cities like Houston, Atlanta, Dallas, Phoenix, etc.
If you limit your search to Top 10 MSAs by population, you'll see that roughly half are expensive and the other half are not. More people live in Atlanta metro than SF, Seattle, or Boston metros but housing costs are fractional vs those places. (Salaries are not equivalent to SF, but IIRC most SF companies pay ~80%+ of SF pay. 80% of SF pay is "mansion money" in most US cities.)
https://www.realtor.com/realestateandhomes-detail/8-Haney-Ct...
https://www.zillow.com/homedetails/1227-Dogwood-Ln-Bloomingt...
Homer's job, as depicted, would pay a lot more than 25k. The article is based off a single frame of the show like 25 years ago. The writers/animators likely didn't mean to establish his cannon salary.
No way that sort of union job would pay under 50k no matter where you lived.
https://www.zillow.com/homedetails/308-W-7th-Ave-Milbank-SD-...
$89,000, 6 bedroom, 3,714 sf
https://www.zillow.com/homedetails/801-Ogden-St-Oxford-NE-68...
$82,500, 4 bedroom, 1626 sqft
https://www.zillow.com/homedetails/522-1st-Ave-NE-Oelwein-IA...
$82,900, 4 bedroom, 1,424 sqft
https://www.zillow.com/homedetails/724-N-5th-St-Manitowoc-WI...
$50,000, 4 bedroom, 1,491 sqft
https://www.zillow.com/homedetails/130-Main-Ave-N-Fessenden-...
In my midwest town, unless that was built 100 years ago, no way it's being less than that. Doesn't even matter if it was lead paint or vinyl siding. That home homer lived in was the exception, by far the rule.
$89,900 - https://www.zillow.com/homedetails/130-Main-Ave-N-Fessenden-...
$92,000, No basement, but 5 bedrooms, 2,730 sq ft.
https://www.zillow.com/homedetails/402-N-Mulberry-St-Eureka-...
$82,000, 6 bedroom, 3,198 sq ft
https://www.zillow.com/homedetails/300-Seminole-Trl-Foss-OK-...
$55,000, 5 bedroom, 2,500 sq ft
https://www.zillow.com/homedetails/1601-Spring-St-Parkersbur...
This was a small town in the Midwest. No lead paint, vinyl siding, or crime to speak of.
Another childhood home, 3 bed/2 bath and 1900 sf, is worth $55k currently. Also a brick home in relatively good condition, built in the 1920s, though considerably further from a real city.
These are places I actually lived. People seriously underestimate how cheap housing is in the US once you leave the big city.
If you go to a national park and live in a tent, that's even cheaper. The point of being in proximity to a big city is the opportunity it affords - better jobs and better mate prospects.
Absolute price of a property only matters in a vacuum, e.g. if you're already independently wealthy and can live off of remote investments and not need a day job. In fact, in most cases, without markets distorted by things like Prop 13, the price of real estate is a pretty good proxy for the opportunities afforded by living there: Jobs/Mates/Schools.
These places are not that desirable if you are looking for a cosmopolitan life, but we're talking about Homer Simpson here. Most people are much closer to Homer Simpson than a mega-city globetrotter.
Both Marge and Roseanne are stay at home moms. Both have multiple kids. Both have working class husbands.
I was gonna say just that. Frank Grimes clearly explained in so many words that by real life standards Homer would never have attained such a relatively high level of success.
A guy with Homer's intellect, at best, could only at best, hope to work at Walmart maybe as a stock person or security guard.
With such a salary, first of all, he might not have even been able to keep Marge around, much less, not end up anywhere but a trailer park or some similar dwelling.
I often see it phrased this way, but I always wonder how much of the effect is actually "A rise in two-income households has led to inflation and stagnant wages"?
Certainly, there's a positive feedback mechanism at play, but it always seems to be presented as "A causes B" rather than "A and B reinforce each other".
No doubt your point of mismanagement and bad actors is valid but it’s important to recognize that much of the glory days of the American middle class corresponded to the height of many others misfortune.
In our local newspaper there have been many articles about wage stagnation and the decline of our manufacturing base as well - albeit we may be a few years behind America which isn't much in the grand scheme of things.
It's not women's fault collectively though. The funny thing is mass influx of labor like this are the very things unions have fought against. But unlike non-americans, unions couldn't be anti-women because they'd look bad, and they couldn't be anti-women in the workforce because it'd also be anti American since they're citizens.
What we have now is either people staying single longer and eventually they end up with Simpsons' style living standard (while staying Single) or they eventually achieve it via DINK lifestyle.
I think a huge part that has played into making this transformation is due to people's increased access to cheap loans (mortgage) and the idea that real-estate is the ultimate ROI game-in-the-town and the new pension fund.
What we see now (compared to say 1980s): almost no major corps offering pension, inflation to the point where both Husband and Wife need to work in order to just afford a property and perhaps a kid, creeping fees/charges (cellphones, internet, netflix, disney+, etc.).
This all leads to people, in my opinion, to look for safety net in order to fend themselves in old age: buy house -- no, make it 2 or 3 houses so you can live off their rent income, delay (or forget about) having kid(s) to achieve that financial goals. Automation and globalization has also caused some pain points: IT jobs are much more competitive than say even 10 years ago and there is always threat of being left out in the cold due to outsourcing.
See, funny thing is, here in Canada, I would always see hardworking immigrant families where the Husband and the Wife would be working in multiple low-income jobs and even their teenage kids would be picking up retail/factory job while studying to balance their family's financial books. To me, it always seemed excessive or even mindboggling - but now, it makes perfect sense...it is the very future for the masses in North America.
And for folks in developing World: Don't worry, your turn will come to experience all this (if you haven't yet) soon enough in your lifetime. I guarantee it.
For the US (and this generally holds true in other western countries to varying degrees), the rise of female workforce participation was (as you imply) a counterbalance to stagnating real wage growth.
But this isn't due to inflation. It's due to changes in income distribution.
While it's true that labor productivity growth has slowed over the last few decades, GDP per capita has continued to grow (https://www.macrotrends.net/countries/USA/united-states/gdp-...). What's changed is that those gains have been overwhelmingly distributed to the rich.
The middle and lower classes have compensated for this by, as you note, increasing workforce participation, increasing reliance on consumer debt, and increasing personal bankruptcy (https://files.stlouisfed.org/files/htdocs/publications/revie...).
A counterbalance or an unintended cause? From a very high-level viewpoint, the market optimizes to capture disposable income, both through offering new things to buy, and price increases on the old things (the more disposable income you have, the less likely you are to seek out alternatives if something you like becomes more expensive). So, as more and more household became double-income, the market compensated, locking female workforce participation from a choice into a necessity.
One shouldn't assume this is zero sum. Increased labor participation should (given consistent productivity) driven economic growth—i.e. GDP should go up; everyone should get richer.
Increased workforce participation can of course drive down wages. That could explain the weakened status of the middle class. But that doesn't explain declining labor productivity.
I doubt there's one single cause. Women entering the workforce was probably a reaction to labor insecurity and also conceivably a driver of it; that resulting insecurity probably also is attributable to various policy changes (weakening of unions, decreasing political power of the working class, the increasing role of capital). I don't have a good one-sentence summary, nor have I even made up my own mind on this.
I have a favourite brand of tea that I've been drinking for years. I have some disposable income, so even if the price of that tea went up 2x, I wouldn't switch to a cheaper (but less tasty) alternative. But I know people who would, and I lived through period of financial distress during which I'd make such switch. The same applies to quite a lot of other goods I buy: from ketchup and mustard to soap and toilet paper.
The same also applies to the places I shop. I'm already buying most groceries at our local ALDI equivalent, but I could optimize that further - but I don't, because I have disposable income, and I won't - even if the prices go up - until it becomes noticeable enough on my balance sheet to justify the effort.
My hypothesis is the example above, but generalized over population: if an average person has $X of disposable income, the market suddenly loses the downward pressure from demand side to the tune of $X; the pressure resumes once the average person has no disposable income.
I haven't made my mind up on this either, I'm just presenting what I currently believe to be a causal relationship. This is partially based on the experience in European countries (notably Poland and Germany), where double income is increasingly becoming a necessity as well, but we don't have some of the commonly attributed contributory factors like student debt and high healthcare costs.
Yet even if that were true, if we treat this purely as zero sum (and don't account for economic growth), we can still easily look at _distribution_ of wealth and income, and the trends there (as I noted elsewhere), both in the US and the developed world more broadly, are directionally consistent with less income due to labor and a greater role of capital ownership.
I don't think this inflationary argument (which may be valid) would explain why capital ownership would be an increasing share of overall wealth. I tend to think this is better explained by (crudely summarizing) Piketty's thesis that the Kuznets curve is simply wrong, that (unfortunately) war and commensurate economic upheaval is associated with a flattening of inequality, and that the long period of relative growth and stability in the west almost inevitably leads to increasing inequality and a relative weakening of the labor force.
I don’t understand this statement. Is it meant to imply that people in the developing world right now have it better than those in the developed world?
I was pointing more towards relatively wealthy countries where the Governments are still subsidizing various aspects of life AND they are still classified as 'not first world yet'. They definitely have it easy to a large extent (Citizens of GCC for example) -- but even the sands of time are also shifting the tide over there, in socio-economic aspects, that is.
(Some easily-viewed graphs here: https://www.un.org/development/desa/dpad/wp-content/uploads/.... Note that while emerging economies have higher labor productivity growth than established economies, both have, somewhat surprisingly, experienced declines in growth over time.)
It's not that inequality is a problem, but if you are willing to go 50 miles from the coasts you will find people in the trades who do OK, some with help from a union, some not. Some of them get paid pretty well but what they all have in common is that they didn't start their career with $200,000 in college debt.
So many things make it invisible, however, including:
* a heavy involvement of illegal aliens in "services", the "trades" and "agriculture" in places like California. These people work hard at being "invisible" because if they become visible they get deported; a result of it is that people don't have a realistic image of this work and in the people that do it
* the media is demographically unrepresentative of the country as a whole: if you read the whole New York Times (particular the Sunday metro) it seems almost as provincial as a paper from small town South Dakota. There is a lot of content that plays to the fears and anxieties of over-represented groups in the New York City suburbs.
* for HN in particular: every kind of engineering other than "software engineering" requires occupational licensing and has professional associations that both stick up for workers and set a bar for training and quality. As a result if you work in a place like a library or a hospital you'll never quite be accepted or taken seriously by the licensed occupation folks who run the organization. To people in our field, the idea of having a group that looks out for our interests seems unthinkable, which is great news for all the other people who are organized and have one less pressure group to fight against. Thus the idea that you could have a union job is just as invisible as having an ag job.
USA today and WSJ have a larger paid circulation. USA today is a national paper. There are also weeklies like Time.
However, I still think inequality is a massive problem. People in trades or services that work for larger conglomerate companies can't fly under the radar, don't have health benefits, and can be laid off en masse. They aren't generally "doing OK".
Also:
>every kind of engineering other than "software engineering" requires occupational licensing and has professional associations that both stick up for workers and set a bar for training and quality
Once upon a time, that was the reality. These days a lot of occupational licensing exists solely for profiteering and protectionism. Professional education/certification companies print money on the back of egregious CPE requirements, while new entrants to the field find themselves absolutely crowded out of a few entry level jobs with financially prohibitive certification and education requirements. Mind you, these grads already have a pile of debt, and no way to pay it back yet. Those groups work great if you've been in the field for 15+ years, not so much if you're just starting out.
For better or worse, software engineering is slightly more egalitarian in that regard: you can self-educate, you don't necessarily need to amass a ton of debt, and can get even an entry-level job that would make the Simpson's life "attainable".
This really be true. So much of the certification Ive seen are bogus nogus even high schoolers can figure out. I suppose the software world cares less about looking good on paper and more about practically writing software of good quality/creative work.
The software world cares less about building things that actually work reliably, compared to other engineering professions. It's accepted and sometimes even celebrated that software will have serious, preventable defects (e.g. "move fast and break things"), in a way that's not so in many regulated professions that "build things."
The broad trends in union membership, financial insecurity, and income and wealth distribution hinted at in the article are, to my knowledge, broadly true in the US, and also true when broken down by geographic distribution (rural vs urban).
Anecdotally—I grew up in rural America, and people would talk about the nearby (50k person) city like "the big city." I would say there was very little awareness of urban folks how rural residents nearby lived, and similar ignorance in the reverse.
The core of the argument OP is making is that you can have a more comfortable lifestyle in a rural area on a lower income.
You're right that rural costs of living are lower. Unfortunately I don't see any good data adjusting for this.
Nonetheless, the idea that rural America is doing just fine is sort of silly, for a few reasons:
- It's a minority of the population. So from a policy perspective, it's unclear to me what the conclusion should be. That more people should move to rural areas? That the Atlantic article is missing the experience of 1/5th of the population? ;)
- The same macro trends (rising GINI, declining real household wealth) exist across rural/suburban/urban divisions. (Note too that the Simpsons is probably set in a suburban, not rural, area—and suburban areas have experienced a sharp increase in poverty.)
- Qualitatively, rural poverty is associated with prescription drug abuse (extremely prevalent where I grew up), limited education and labor flexibility, limited geographic flexibility, etc.
So I never know what to make of these "it's going fine in Rural America" arguments.
It has a significant impact on rates: https://www.census.gov/library/publications/2020/demo/p60-27...
California's, for example, goes from 12-ish percent (average) to 18-ish percent (below only DC).
You know, the federal poverty level for a single individual is under $13K per year. In which low income / low cost area do you think that's not a problem?
The problem is the flattening of urban and rural within state like others have said. A suburb of NYC may as well be a foreign country compared to a suburb of Buffalo.
Of course if you're gonna doll out aid based on the absolute number you should set a sane threshold but that doesn't really matter for the purposes of this discussion.
If anything, yes, I agree the thresholds should be set much higher than they are now, and should be dependent on local CoL, but $13K/year is going to be a problem no matter where you live.
The closer the rate is set to the real definition of poor (however you define that) is the less adjustment you need to do to know how many people are "actually" poor, you just multiply by the population of the area that has that rate.
But like I said, the problem is you can't use one federal number and apply it across areas (be those areas states or subsections of states) with very different economic conditions without adjustment. Trying to do so is like trying to compare salaries across countries without taking into account exchange rates.
With the single federal rate you can do some rough comparisons. For example we can compare Ohio, a fairly blue collar, not totally rural but also not urban dominated state, with Massachusetts, a state that has all its stats dominated by the Boston area in order to tease out the difference between what it's like living in middle America. But even than it's kind of limiting because the next obvious question is what are the county poverty rates and that gets real messy and inaccurate real fast.
Think of the federal poverty rate like U3 unemployment, better than nothing but not good for much if you really want to understand what's going on
I hope that answers your question! Personally, I found the report from the Census Bureau and BLS (as per my earlier comment) quite educational for exactly this sort of eminently reasonable concern. But your mileage may vary!
Do let me know if you have any trouble with the Census Bureau SPM report, I'm happy to do my best to help you read it.
To put it another way, I think the question that you're getting stuck on is too simple to be very helpful and that better information might help you formulate better questions. I hope this makes sense to you, but I know my communications skills are quite far from perfect.
And these things vary, sometimes greatly, based on where you live.
Barnstable County (where the Kennedys live and the Kochs have (had?) summer houses) for a long time (might still be) middle of the road, poor-ish (~35k median income 2010 census, current national average is 56k) on paper because the really rich claim primary residence elsewhere and the wealthy people who do claim residence are retired (retired engineering managers and whanot, these people aren't Murdoch rich) are mostly savvy enough to look poor on paper so they can get discounted services from the state and pass more of it on to their kids. Who does that leave? Well there's no white collar industry to speak of so it leaves the trademen who fix the plumbing in the Kennedy compound, the service industry and a few business owners. So the county winds up looking dirt poor on paper despite the fact that there's a ton of money sloshing around (and it shows when you look at how the tradesmen and small business owners live).
This is an extreme example but you can see how more minor differences when applied across an entire county or state could pollute a comparison when you're trying to compare very precise things, like how well off a median plumber in Reno is vs the median plumber in Chicago.
With that in mind, the answer seems to be that in twenty-five states the straightforward calculation based on income exaggerates real poverty. You'll find aggregate numbers, and methodological details, at the link above.
I hope that answers your question.
The idea that there were parts of the US where you could buy a house for $60k was just as foreign as the idea of someone making $25k per year. They simply had no frame of reference for what wages and cost of living look like in places that weren't big cities.
I doubt it, based on retirement saving statistics, opiate addiction statistics, and healthcare related financial issues.
People on and off the coasts don’t have sufficient retirement savings, emergency savings, nor income security especially when they hit years 50 to 65 (soon to be 70 as social security and Medicare ages rise).
People in the trades might be doing fine if you ignore the health costs associated with driving long distances and manual labor, especially ones that rear their head in people’s 50s.
[0 https://www.fool.com/the-ascent/research/average-savings-acc...
Holding sbustnaitail money in a savings account is pretty dumb with interest rates being so low for at least the last entire generation.
Though I suspect net worth and retirement savings are still pretty low.
Generally to get up in the $200k range, you need medical/dental/pharmacy/veterinary/law school debt.
The fact that they used to charge 8% interest on those loans is just plain evil. It's not like it's unsecured, it's the only kind of loan you can't get rid of during bankruptcy.
Situation A: Government offers unlimited amounts of loan money for students. Colleges increase prices since their customers have infinite money. Children and their parents go into further and further debt as colleges keep raising prices and there is no limit to the amount of debt the government will underwrite.
Situation B: Government does not lend any money. Colleges have to keep tuition at affordable levels, and/or obtain funding from government. Children pay an appropriate amount of money for education and don't waste money on fancy gyms and stadiums and catering halls and ceremonies and extraneous administrators.
"Federal student loans" are nothing more than a public front for private loan companies. Sounds familiar to another intensely politicized system...
My parents told me federal student loans (actually from the government) had a fraction of a percent interest when they went to college in the late 80's, although neither of their families had any money to speak of.
I'm different in that my parents worked their way (along with a fair amount of luck) to teetering on the edge of entering the upper middle class.
They didn't have enough money to send all of their kids to college, but were able to pay for the non-tuition expenses we couldn't cover ourselves on school jobs.
I don't know what student loans would have looked like for a family in an equivalent position in the late 80's.
My main hope is that barring some form of socialized education system happening in the next 20+ years that I'm able to pay for the educations of any future kids of mine without severely hurting myself financially, and succeed in raising them in such a way where they understand and appreciate the gravity of such a thing.
The only way to escape a federal student loan is dying. Loan forgiveness is the government paying the creditor. It's not your average unsecured loan you can shirk through bankruptcy.
The real scam artists are the schools, which have bloated the cost of an education beyond all reason.
The numbers you are using would need to be a loan at 20% interest with interest charged from the very beginning. Were you using credit cards to borrow money for school?
At least at the time I went (2011 to 2016), federal loans had two modes - subsidized and unsubsidized. Subsidized loans don't begin to accrue interest until graduation, the unsubsidized ones start accruing on day 1. They only accrue interest on the principle though, it's not compounded. If you don't pay off the accumulated interest within 6 months following graduation, it's capitalized (added to the principle).
My parents always told me that their gross income determines whether or not you can get the subsidized loans, even for the fraction of the loans in the student's name. They always complained how it didn't take cost of living, home ownership, or how many children you had into consideration. Sure, they were well enough off that they could have probably afforded to pay for me, but my 2 younger siblings and I were all college bound. I would have never assumed or expected them to pay for my schooling anyways. I wasn't raised that entitled.
The first year I attended UC, the Parent Plus loans represented something like 80% of my borrowing. The first year was at 7.8% on my parent plus loan, 5 and something on the ones in my name.
I get that I'm in an enviable position to have been able to easily handle that due to tech industry income, but I work with a ton of European expats, all of whom take jabs at me for coming from a country that doesn't cover higher education for their citizens. Always stings a bit.
Good point. This is a big problem when it comes to COVID. This invisible sector has been been working hard and that sector of the economy going. But they don't have health insurance. Because of the invisibility requirement, they don't have access to the same medical resources, and definitely would not have the same health seeking behaviour as 'non-invisible' people. Are these people even in the COVID vaccination plans?
- Owner/operator of heavy construction equipment typically makes $175 an hour or more(maintenance costs are high and work dispatch takes a cut also) yearly salary was usually ~ $150k
- Electricians make between $47-55 an hour, this does not include overtime as my Wife's cousin made 40-50% more due to OT.
- Building engineers pay varies, but a good amount pay $80-90k+.
All salaries are SF bay area, almost everyone mentioned owns their own home. Ages range from low 60's to early 40's. One important point that differs from the Simpsons is that every person mentioned(all are married) the spouse works and also makes a similar salary(no one has more than 2 kids also). So a Simpsons existence is very hard to emulate, but the "trades" pay more than alot of people expect.
You don't think these two facts are related? What about 20-something tradesmen? Will they ever be able to afford their own home?
The 20-something tradesmen have mostly not settled down that much yet just like the 20-something software engineers so they live in apartments wherever.
The biggest difference now compared to the 90s is that the blue collar people have been pushed 20-40min farther out of the major cities. Homer Simpson probably commuted 30min. Now the white collar engineer commutes 30min and the electrician commutes 30min farther because that's where the suburb he can afford is. The white collar engineer lives in what used to be the blue collar suburb. Also in my anecdotal experience it seems like stay at home mothers haven't totally gone away with either group but they've become rarer in the white collar group than the blue collar group.
Everyone blue collar I know bought their first house at 30+/- a few. The people that bought sooner were the people who prioritized it because they were popping out a lot of kids or were beginning to build their own business and needed space. If anything it seems like the blue collar crowd buys a little before the white collar crowd simply because they're more open to living farther out in order to make things affordable.
>Will they ever be able to afford their own home?
Yes. It just won't be in the same suburb as the people on HN.
That's fabulous if you get to be one of those 82,000 people who gets to become a plumber. You certainly can earn a good living that way:
> [A]bout 55 occupations are identified as skilled trades, which accounted for over 19 million jobs in 2014. The average job growth rate outlook from 2014-2024 is eight percent, with an average median wage in 2016 of $46,146; the median annual wage for all workers in 2016 was $37,040. [1]
But, that's really about where the good news ends.
Let's look at what actual demand for skilled trades really is.
We can approximate which are the highest growth trades by those which pay the most. Multiple Google searches have told me that electricians are among the top paying skilled trades, due to a large shortage of qualified employees. The job outlook over the next 10 years for electricians is projected to grow by about 8%, for a total of about 62,000 additional jobs added. [2]
If we place that in context with the number given earlier for plumbers, it seems reasonable to estimate that each of the skilled trades could experience job growth of up to about 100,000 jobs over the next 10 years. Multiply that by 55 occupations, and, we see that 5.5M people get to live the secure, skilled trades life that we fetishize so much these days. (Really, it's almost like "learn a trade" has become the new "learn to code.")
Anybody see the problem yet?
The US is projected to have around 360M people in 2030, and we've found jobs for 5.5M of them in this extremely oversimplified analysis.
So, sure, the whole "learn a trade" meme works, but it only works for the ~2% of people who are going to be able to get into those occupations in the next 10 years. Skilled trades are not going to save future generations from systemic problems like the decline of real wages and declining union membership anytime soon without something else to go along with it. My nephew can't even aspire to be Homer Simpson, and that's certainly not what I, or my brother, ever wanted for him.
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[0]: https://www.careerexplorer.com/careers/plumber/job-market/
[1]: https://www.stlouisfed.org/publications/bridges/fall-2017/ap...
[2]: https://www.bls.gov/ooh/construction-and-extraction/electric...
No, it doesn't.[1] Licensure is required for an engineer to provide engineering services "to the public". The largest group who do not require licensure are those who fit into the "industrial exemption", engineers employed by a company to work on products manufactured and sold by said company. This particularly affects electrical and mechanical engineers.
I was an electrical engineer for four years to start my career, and I never even took the FE exam. It likely would have limited my career progression at some point, but it never would stop me from working as an engineer.
[1] In the US. Since this article is from The Atlantic and is about "Life in the Simpsons", I am going to assume the US for the context of everything I say.
So it's the white collar folks who are ignorant and think that lifestyle doesn't exist...but also that lifestyle doesn't exist where the white collar folks live? It seems like you are saying that this lifestyle still exists in other places than the place depicted on the Simpsons. Another way to say that is "The Life in the Simpsons is No Longer Attainable."
Saying that someone could have a similar lifestyle somewhere else doesn't mean people are wrong when they imagine they can't have it where they are now. It seems like you agree with that? Also, FWIW, working in the trades pays pretty damn good in cities too.
I also know families that are hard working, responsible, still still cannot afford to make ends meet.
Likewise, I know families who are none of those things, and have never known a real struggle.
Implying that not being able to achieve the American Dream is result of not working hard, and/or living beyond your means is a gross oversimplification and frankly ignorant.
This simulation illustrates that when you have low income how hard it is to make ends meet.
> Implying that not being able to achieve the American Dream is result of not working hard, and/or living beyond your means is a gross oversimplification and frankly ignorant.
Not at all, there are always a few outliers, because, besides the occasional run of just bad luck, a lot of people who appear to be responsible really aren't.
There are a lot of incidental costs associated in life that those of us with savings, and or good incomes can absorb. For those without savings and/or limited income, it becomes a game of robbing Peter to pay Paul.
Yep. And in many of these situations Peter is future you and Paul is current you.
I explicitly deny that we are completely at the mercy of external forces. Our choices have effects that matter.
But yeah, if you're a white straight man and you're able to dodge any crippling medical bills, it doesn't take much more than responsibility to sustain a decent life.
If you're black, female, gay, etc, you may well have lower pay, higher unemployment, increased interaction with law enforcement, etc. That's all true, and is something that we as a society should work on changing.
But within that flawed social environment, black female gay people who decide, say, to use their spare time to try to pick up new skills will probably have better outcomes on average than those in the exact same circumstances who decide to lose themselves in alcohol.
The environment is flawed. Within that flawed environment, individual choices still matter.
The consequence of a broken tail light should impact every American the same. It does not.
Likewise, the consequence of a DUI should also impact every American the same. It does not.
And responsibility costs money. It's much harder to be responsible when you're poor. The immediate threat of poverty alters your decision making process, as does the malnutrition from only being able to afford garbage food. And that's assuming a fair and equitable system, without structural racism or other forms of ingrained discrimination.
Let's quit pretending this is normal or acceptable, or that some free market solution will come along. The solution is wealth redistribution.
2) It's not a coincidence that military targets enlistments from low income areas.
It wasn't until my dad made E4 that he was able to quit his second job working at a gas station.
Sometimes, those soldiers weren't able to escape their upbringing. I'd hear stories of my dad's GIs who would spend their money on alcohol and drugs, and eventually got chaptered out.
I'm not alone.
These kinds of stories are why I, as a north European, have a hard time imagining living in the US. Sure a SE job will pay much more net in the US, but you have litte to no social net that dampens your fall when it comes (as it does for us all).
My partner was diagnosed with cancer little over a year ago. She had all (100%) of her medical bills taken care of by the state. She took 6 months off work on full pay, as she and all living here have a legal right to do. Her employer added 3 months of fully paid medical leave on top of that. She can not be fired due to a medical issue arrising. She has now finished her treatment, full remission and is back at work.
One point I want to emphasize "responsible" in his example really just means not making a single mistake, ever.
I've been poor. You have good as well as bad days. I remember the day I won £75 with £1 on a fruit machine. I also remember the days I'd put £10 in and get nothing. I remember the unexpected bill but they weren't every day, they would be every 6 months so you hadn't accounted for them.
It would be more realistic if it allowed those little moments of triumph, only to snatch it away later.
There are a lot of people out there that don't feel the need to spend money to be happy.
If we want to play that game, I can refute the refutal with my own anecdote. I grew up very poor but managed to get to a place several rungs up the socio-economic ladder higher than where I was as a kid. Sure, I worked hard and gritted my way through things like having to skip meals. But a good number of things had to line up just right for me to get where I am today. It was just as much about me seizing opportunities as it was just being lucky enough to have a shot at them in the first place. It is a lot easier to make opportunities for yourself when you aren't worried about where your next meal is coming from or when you can afford leisure activities that build out your network.
When you start off at the bottom, there is no magic Disney formula you follow to reach success. It is entirely possible to do everything right and still end up stuck in destitution.
Here's a hint: the simplistic (I would even go as far as to say ignorant) argument that if you're not making it, you're just not responsible enough. It's just a talking point without having to actually talk about anything.
Bad luck happens to good people. The question is what mindset leads to better outcomes.
In an unjust world is it better to focus on the injustice or is it better to keep trying to make your life better. It seems (selection bias and all) that those that have the better mindset (maybe self-centric to their own communities needs) do better regardless of income.
As long as we're using anecdotal evidence ...
many of the people I personally know who have suffered the worst during the pandemic, are people who never saved or put away money away when times are good. They also, never invested in additional education nor skills. Their disposable income went to vacations, new cars, daily coffee at Starbucks, and a bunch of other frivolities. Always carrying a near zero bank account from end of pay period to end of pay period. But hey, at least they met their responsibilities. They were functioning paycheck-to-paycheck people.
Now many broke and really struggling even if they are still employed. Why? Because of reduced hours or salaries to adjust for the pandemic. Usually these kinds of people are susceptible to the slightest change in their salary. That's part and parcel of not saving and living strictly paycheck to paycheck.
Do they deserve it? No of course not. Nobody deserves bad fortune like this. These people weren't trying to harm others and they were decent hard working people.
However, ... it's not hard to see why they end up like this.
These people were never taught to save away money when times were good, to live within their means, to invest, to do the math before buying a car and making modest decisions, heck, even to have the common sense to know that a daily coffee at Starbucks is a terrible financial decision.
And many of of these people, even people who are still gainfully employed usually retort with: well I'm never gonna be able to own a home, so I buy what I want with my money now to make myself happy., but the thing is, many people who own homes now, also didn't just have all the money available and had to save up for the down payment and probably live a few years house poor.
This expectation that we should all be able to own at least: one smartphone, one computer, one expensive game console, etc. etc. that wasn't a thing back then. Today there are so many things vying for our dollars, that it's hard to just make the choice to save up for a home.
But nevertheless, it still needs to be done and especially now during times of a pandemic, the money we put away isn't for a home, but rather, to get through this crisis.
It is not victim shaming / blaming to point out that stupid frivolous behavior / practices are a root cause of people's problems.
However, it's imperative to understand that bad circumstances, such as COVID-19 can derail the plans of even the most thoughtful, budget conscious and financially savvy people.
The thing is, to never take for granted that good times last indefinitely and not squander money earned.
Imagine two people that both earn $100k a year. Person A spends $50k and saves the rest. Person B, spends everything they possibly can. Person A is working toward a master's degree in their field investing an hour each evening toward it. Person B spends an hour each evening watching netflix.
Then the pandemic hits. (or any other number of other things that are likely to result in job loss.) Both lose their jobs. Person A has savings to get by and ramps up finishing their master's degree. Person B is broke and facing eviction.
Does B deserve to be in a worse situation than A? Well, yes, but by "deserve" I don't mean that I would wish anything ill on them, but A was willing to forgo spending in order to have more security in the future. It is kind of like asking if someone who buys 20k mile tires "deserves" to have them wear out at 20k miles when someone that spent significantly more on 90k mile tires has their's last much longer. It was just a matter of investing in different things with different consequences. Both buying the 20k tires and the 90k tires could be very rational depending on what the person was optimizing for.
I agree with your overall point, but the Starbucks (see also Avocado Toast) argument is a pretty silly trope. By and large, people aren't broke because they buy coffee at Starbucks, or have a smartphone or game console, and they're not going to suddenly be on the path to riches by giving these things up. These things are small. People are broke because of the big expenses: Health care costs, housing costs, education costs.
If someone gives up a $5/workday coffee habit, we're talking around $1200 per year. That's chump change in the grand scheme of things--it's a single trip to the hospital in an ambulance. It would take 40 years of giving up that coffee in order to merely save for a down payment on a $250K starter home.
I find that the people who are the best with money don't take even the little expenses so lightly and try to find good deals wherever possible.
When it comes to coffee, sure, they might buy the occasional drink but it won't be a daily thing guaranteed. They'll usually brew their own coffee.
My point being, that when you're savvy about not wasting money then you're all in most of the time.
Actually, now that I think about it, the new proverbial overpriced coffee or avocado toeast is starting to become online subscriptions.
This is a place where people should really consider if they're worth the $5-10 per month that they pay and hardly ever think about after signing up.
Also, please list if they had jobs with medical insurance pre ACA, and whether or not they have experienced any healthcare events in their family.
And I know plenty of statistical evidence that says you're wrong. Just looking at wage stagnation and inflation numbers is enough to demonstrate there's a real problem being experienced by people every single day.
But, hey, I'm sure your anecdotes are every bit as compelling...
George Carlin had it right when he said the game was rigged.
It’s clear that money is poorly correlated with a satisfied life. I wish there was a way to track that with minimal bias.
Income is a red herring above certain thresholds.
https://www.whitehouse.gov/sites/whitehouse.gov/files/images...
Contrast that with Chongqing, China, where construction has kept rent to $75 a month:
https://web.archive.org/web/20200713034719/https://www.nytim...
Or Houston, Texas, where housing costs less, adjusted for inflation, than it did in 1980:
https://www.sightline.org/2017/09/21/yes-you-can-build-your-...
Additionally, Houston is huge in terms of landmass. Look at housing prices for the vast majority of the people who actually commute to the Houston city center and it'd be massively higher. A Simpsons style house and yard that's "in the loop" could easily be a million dollars in Houston. I know people with smaller houses and smaller yards whose homes are nearly a million.
Just because you don’t like the neighborhood or schools doesn’t mean they don’t exist (image shows homes for under $150k in Houston, assume the ones inside the loop are condos)
I believe it's because those shows are still made for the same people, those who were kids in the early 90's. So show makers don't adapt them to the modern world, they let their viewers enjoy snapshots of their past, it's an anchor in their modern world.
For context: When I was a kid, I lived in a western european country where the Simpsons were clearly a kid /teen thing.
As a 1st generation American immigrant kid in the 90's, both my parents had to work.
Then watching it became a family event.
Did your parents have a pov regarding Mortal Kombat? My dad recorded the Senate debate on Video Game violence off CSPAN, and made me watch it.
Since they all had their own bedrooms, they'd need a 4 bedroom home (assume Maggie still sleeps with Marge & Homer). The author is in Michigan. Let's choose Flint to simulate having a Nuke in the back yard. A 4 bedroom home in Flint (not in the 'lead zone', Marge would never allow it) is minimum $200,000. Payments on a mortgage at 3% are about $800/mo.
Monthly Expenses:
$800 Mortgage
$300 property tax
$700 food for 5
$150 clothes (the kids are growing, need shoes annually, need diapers for Maggie...)
$300 Auto expenses (used car, maintenance, insurance, gas)
$2,250/month so far. That covers the basics and leaves $16,000! But what about health insurance?
(gulp)
What are the odds that Homer's $20/hr. job includes fully paid health insurance for his family of 5? Let's give a little benefit and say at least it covers Homer as the employee (a stretch, yes?). His employer would require him to pay for his 3 kids and wife. Grampa is on Medicare/Medicaid + social security. So he's on his own...
To calibrate for the rest of the family...
Hmm... Healthcare.gov says that marketplace plans are not available in Homer's county.
And, according to eHealth.com, Homer doesn't qualify for 'savings'.
So, it's off to Healthcare.gov, which requires an account, so I'll stop there.
From recent personal experience, the most basic plans run $1,500/month and have deductibles that would bankrupt Homer. Lower deductibles would put the premiums out of reach. I think he is out of cash at this point.
$90,000
https://www.zillow.com/homedetails/300-Highland-Rd-Sturgis-K...?
$89,900 for a five bedroom
https://www.zillow.com/homedetails/2901-Mcclellan-Blvd-Annis...
$99,900 for a four bedroom
https://www.zillow.com/homedetails/623-Ben-Hur-Ave-Knoxville...
He doesn't make enough, 42K/year is below 138% of the poverty line for a family of five (barely). So it looks like instead they would be eligible for Healthy Michigan which is part of expanded Medicaid. That income limit is based on MAGI (how appropriate!) so if they were slightly over, they could work around it. And even if they were over the limit, the limits for CHIP are higher so they could make more and still have coverage for the kids. Looks like he would be eligible even with insurance from work, that coverage would be primary. Total cost of premium/co-pays limited to 5% of income.
This was enacted around 2013 so people with that income today would be way better off than a similar family in the 1990s as far as health care goes.
The problem isn't a 42K income in Flint, the problem is there aren't enough jobs in Flint that pay $20 an hour, the median household income is around $29K.
I recently did a rewatch of older Simpsons episodes lately and aside from the 90s references a lot of the economic conditions seems incredibly outdated. Much like watching Friends or even more "recent" shows like How I Met Your Mother (HIMYM) where the characters undergo their lives in a big expensive city but not work constantly.
It's hard to suspend belief on those shows given the shenanigans they do. How on earth did they live in that apartment (Friends/HIMYM), or live in such a large single family home on one income? The shows end up having to address their own disbelief with rent control (Friends) or the Frank Grimes episode (The Simpsons).
Unlike prior shows like, say, The Brady Bunch, which were almost a reality show. I mean, you grew up with a live-in maid, right?
It's TV; if it were realistic, no one would watch it, including the "reality" shows.
Its easy to look at one side of the coin and ignore the other. You can’t have your cake and eat it, too.
I’d argue it’s more about _lowered_ educational standards. A high school education ain’t what it used to be and colleges are trying their damnedest to get every single person they can through the doors (and keep the cash flowing). Pretty soon a bachelor’s degree is going to be worthless as well.
That's not what adjusted gross income means. How much would anyone like to bet that the author's Form 1040 line 8b or Form 1040-NR line 35 shows an adjusted gross income figure substantially higher than $19?
What is the macro explanation for this? Is health and housing in any way 2-3x better now than it was then?
https://en.wikipedia.org/wiki/Average_Indexed_Monthly_Earnin...
Furthermore, with things like housing, we get major distortions of real world meaning that are completely obscured by macro trends. For example, the average housing price across the country has outpaced inflation metrics by a little, but if you narrow it to places of economic opportunity, it has drastically outpaced inflation. Any new growth in economic opportunity has been accompanied by even more severe growth in housing costs. The end result is that average housing prices appear flat-ish relative to income, but it has stayed that way due to massive emigration of economically disadvantaged people away from areas of economic opportunity.
What has really happened is that America fell in love with dysfunctional markets. Free market prices, but with significant regulatory capture. We've got cartels on housing via hyper-localized land use regulation that decreases the relative supply of housing.
The median house price doesn't appear to have been adjusted for inflation or median income. So the factor of 2.4 times isn't quite as high as it might first appear.
The size of a median single family house has also grown. Most people prefer to have more space, and are willing to pay more to get more.
https://www.statista.com/statistics/456925/median-size-of-si...
Health care expenses have increased for a variety of reasons. Baumol's cost disease is one factor: most healthcare work can't be automated (yet) and we have to pay the providers more every year. Americans on average are getting older, sicker, and fatter. New treatments have been developed which can extend the lives of some of the sickest patients but at an extremely high cost. In the past 25 years we've improved the 5-year cancer survival rate by around 8% but spent a fortune to accomplish it.
So, for the sake of argument, if an average workers salary had stayed exactly in-line with inflation, house prices could've gone up 4.2x and they would have spent about the same amount of their monthly expenses on the loan per month. Lots of caveats that make this not as true in practice though (taxes, ability to refinance in the future at a lower interest rate, etc.).
[0] https://www.macrotrends.net/2604/30-year-fixed-mortgage-rate...
I’m going to go with 1990 for a specific date. According to their source, house prices have gone up 2.6x since then.
In 1990 the prevailing mortgage interest rate was a little over 10%. Today its about 3%. For a house that costs the exact same amount, the payments today are 2.1x less. Conversely, the same payments today let you afford a house that costs 2.1x more.
Additionally, as far as I can tell, that figure isn’t adjusted for inflation, which is 1.99x since 1990.
Combining inflation and more affordable payments, an equally affordable house would today cost 4.2x what it did in 1990. Seeing “only” a 2.6x increase, the inflation adjusted monthly mortgage payments are almost 40% lower today. For the down payment, however, the easy credit doesn’t help you, only the inflation, so a median inflation adjusted down payment is still 30% more expensive today.
That’s my best guess for macro explanation. Cheaper credit and inflation.
Is the lack of new nuclear plants preventing this from being attainable?
In my opinion, it's not realistic for a high-school graduate with no additional training to be a nuclear operator. I believe it was part of the "ridiculous" that went towards making the show entertaining, and a job that most people would not have in sight into.
My point is that a lack of a specific type of job is not the root cause of the situation the author is describing.
From 1996 to 2019 (the article uses a mix of 2019 and 2020 figures), inflation boosts prices 1.63x.
Homer's $25k 1996 income would be $40.75k in 2019 ($41.5 today). That puts them at the 30th percentile of household income and him the 36th percentile of individual income today [0].
For the house affordability the Q3 2019 vs Q3 1996 median house price increased 2.27x [3]. After adjusting for 1.63x inflation, it's 1.4x more expensive.
But mortgages are way cheaper today. The 1996 December average mortgage interest rates was around 7.7% [1]. Today's 30 year fixed rate mortgage is around 2.9% [2]. Homer's monthly mortgage payments on the same mortgage today would would be 58% of what they were then. Adjusting for the 1.4x real house price increase, a Homer buying today would have monthly payments of 82% what he would in 96. That's 18% lower! (This is what set off my rant, seeing the '2.4x higher housing costs!' in the article)
Healthcare costs are about 3x higher, as the article says, so about 1.8x after inflation adjustment.
Median tuition for a four year college is 2.6x more expensive in 2017-2018 (the last year in their source) and 1.64x more expensive after inflation adjustment, so who knows where their 1.8x number came from.
All together, the Simpsons' family's biggest expense would probably be their mortgage, which would be cheaper today. Not to say anything about expecting TV lifestyles to be affordable. Cue the Friends and How I Met Your Mother giant apartment jokes. There's a story to be told about increasingly inaccessible lifestyles, but this article isn't it.
[0] https://dqydj.com/household-income-percentile-calculator/
[1] http://mortgage-x.com/general/national_monthly_average.asp?y...
It's for a reason that usury/interest is banned in Islam, Christianity, and Judaism for example. It's a parasitic practice that makes the economy fundamentally unstable. This includes dangerous practices such as selling debt for debt (which triggered the 2008 crisis), and things like stock shorting (which, interestingly enough was also banned during the crisis, at least for some critical company stocks).
Get rid of these dangerous, immoral, and parasitic practices, and we'll be on a strong path to improve things.