Why a $100k income no longer buys the American Dream in most places

Even in the '80s they knew this current world would be the outcome. This isn't a surprise to the Fed or the Reaganites.

Now many argue "well raises should be higher than inflation" but data continues to show that this isn't the case, as mentioned in the top of the article, for the last 50 years or so, raises have not kept pace with real cost of living increases. I have seen an argument that raises have evened out somewhat to beat the official inflation rate, but this is dubious, because the reported government inflation rate has exclusions to its calculation and doesn't capture the real cost of living increases faced across the US, due to inflation rate calculation exclusions and approaches.

I've long argued we need some kind of deflation in real costs, what that would look like is hard for me to say. I know its complicated, however I think a good place to start is perhaps returning to pre Reagan era economic 'reforms' is a good first step, as I've seen mentioned elsewhere (on HN or otherwise), as so called 'Reaganomics' hasn't really panned out for the average American over the long term.

I am wondering if it is low because people simply downsizing..

Not saying 3.72 is great, of course, but it's more accurate in terms of actual impact on people.

But I don't think the expenditure increase supports the argument that people's income is being stolen. Whether or not you consider taxation as theft is an ideological stance.

https://www.wolterskluwer.com/en/expert-insights/whole-ball-...

What I’ve seen lately is mega apartment complexes being built and funded by private equity. That’s not good either. Things will end up like Europe where no one owns their flat they just rent in perpetuity.

Which would harm the development of multi-family housing and increase the cost of living. Remember that "real workers" do not build and own 100+-unit dwellings

A house wouldn't be at these incredible prices of $500,000 or $1 million if there were more of them available (supply/demand), real estate investing would in general be less incentivized, where today it's a major channel for loans and investment.

It's fine that it is - of course investors should be able to trade housing and properties like anything else - but it's wrong and cruel to stop building them, as the population continues to increase. They're making people homeless so a much smaller group can make millions of dollars off the scarcity.

It's not a great future if the average person can't afford to own a shelter, and if the price to rent one continues to be thousands of dollars every 30 days in relation to these wages - nobody can realistically pull away when the house price and the rent rate both are rising so fast. My Sacramento midtown apartment in 2010 was $660/mo, my first place in SF was $900/mo the next year. The same places are both over $3k/mo now, yet I made less money in 2023 than I did back in 2010, doing the same job and working more hours.

Meanwhile those who inherited a house for free, or bought it for a lot less money than they cost today can make hundreds of thousands from refinancing (doing nothing) or millions from selling it. That so-called value was created out of intentional scarcity and nothing else - out of depriving other people of homes.

Even the average homeowner can make out like a rockstar investor year-after-year without even having to try because houses are just increasing in value as supply diminishes, there's a problem - it's a real estate bubble that will burst the moment people start building houses and neighborhoods again.

I agree we have to cut down real estate investors, I just think you can solve it in a productive way rather than battling them in politics.

The article uses a wild definition of "American Dream" where 50% of income has to be able to be spent on non-essential things. I really don't think most people will actually spend like that.

[1] https://www.census.gov/quickfacts/fact/table/newyorkcitynewy...