Actually, it would be kind of nice to have both... is there some law of nature which prevents them co-occurring?
On the urban planning side, American cities spend huge amounts of time and effort preventing the demolition of old housing and the construction of housing. This drives up the price of housing.
On the welfare policy side, American states corral all their poor people into their large cities. In Manhattan, riverfront property might be dedicated either to expensive condos (upper west side), or public housing (lower east side). The suburbs, for their part, go to great lengths to prevent the introduction of services for lower-income people.
In most cities, #2 is a bigger problem than #1. If you're willing to compromise on space, living in the suburbs often isn't dramatically cheaper. In theory, getting a 1,500 square foot house would be cheaper in the suburbs versus the city, but suburban municipalities tend to discourage the construction of smaller houses, so often the choice is between 1,500 square feet in the city, or 3,000 square feet in the suburbs, at not altogether dissimilar prices factoring in the cost of commuting and cars.
The biggest problem is schools. In most places, you have to pay for public schools even if you send your kid to private school. And public schools in cities are almost uniformly terrible, not because public schools in cities must intrinsically be terrible, but because as a result of #2, urban school districts are 90%+ low-income. Putting a bunch of poor kids all together in the same school is not a recipe for success. People like to paint it as a funding problem, but its a socioeconomic demographics problem. In Illinois, schools inside Chicago spend almost 40% more per student than schools outside Chicago, but perform far below those outside the city.
Now of course, even the most progressive parents aren't willing to send their children to schools where 90% of the kids come from welfare homes, disproportionately don't have fathers, etc. And they don't want to pay $10,000 per year (for parochial schools), or $20,000+ (for non-religious schools) to send their kids to private schools. So they move to the suburbs, where they can send their kids to socioeconomically homogenous public schools, and take advantage of the services for which they're paying for anyway.
I think the confluence of these factors is really unfortunate, and has an unfortunate impact on American families. First, I think it discourages people who might want kids from having kids. Second, it robs kids of the wonderfully enriching experience of living in cities, in close proximity to other people.
American town planning has been a disaster since time immemorial.
Yes, your expected to give up all semblance of having a life outside your children once you have them.
The neighborhoods with excellent schools and excellent bar scenes exist, but you and I mere mortals are priced out of them.
I just wish it was possible to live in a neighborhood which has good schools, nice neighborhood kids who you can trust to babysit, combined with somewhere within walking distance that's worth going to when you've got a sitter.
The problem with schools is that it is a very large entrenched organization, with lots of special interests (politicians, teachers, administration, etc) who don't want to give up monopoly power. The central organizations suck in a lot of money, and don't improve quality. There are ways to fight this (more charters, close bad schools, etc) but it's very hard and requires a lot of different folks in government willing to fight special interests.