Middle Class in Manhattan and Impoverished in Beverly Hills
Dean Baker beats the press in the form of something about my neighborhood by Robin Shulman:
The Washington Post reports on a new trend for middle class white families with children to live in cities. The fourth sentence tells us that: “In the national imagination, it [Manhattan] was a place of artists, musicians, socialites, Wall Street bankers — or of hustlers, runaways, addicts, murderers. But it was not on the radar of the typical white, middle-class couple as a place to raise children. Those who read a bit further will find that the median income for a white family with children living in Manhattan was $280,000 in 2005, roughly $300,000 in today’s dollars. That’s enough to place this family well up into the top 2 percent of the country’s income distribution.
It’s pretty clear to me as I walk towards the subway on the Upper East side that these families are affluent and Robin admits this. So let’s move onto Felix Salmon watching Ben Stein as Ben complains about how poor he has become:
Fourth, plan for living more frugally. This is not easy for some of us. “What were once vices are now habits,” as the Doobie Brothers once said. This is true for millions of us, but we simply cannot escape the logic and power of arithmetic. We cannot live forever on more than we have in principal and interest (or earnings) and pensions. If that means no more second homes, or no more third cars, so be it. No comfort is worth putting yourself in genuine fear of poverty. For me, your humble scribe, this is a vicious problem, but at some point, it must be solved. But look on the bright side. My pal and investment guru Phil DeMuth and I have shown repeatedly that the best returns for stocks come after periods of extreme pessimism. It is just when the horizon seems darkest and cloudiest that we find above-par returns. And it is just when hopes seem dimmest for the United States that the economy starts to rally. If you have enough liquidity, if you are well diversified, now would be a good time to start back into the buying pool, in the most diversified way imaginable.
Ah Ben – most people don’t have stock portfolios to fall back home. Many people don’t own even one house – let along a house in Beverly Hills. Some in my city don’t one own car and must take public transportation to work – assuming they have a job. But let’s give the microphone to Felix:
Stein is becoming a sick and unfunny joke at this point, and the NYT, by association, is the butt of that joke. Nick Kristof and many other reporters do a very good job reporting on real poverty for the New York Times; I hope they’re barraging their editors right now with complaints about how Stein is trivializing an extremely serious problem. Given the level of intellectual honesty that Stein displays in his new film, it shouldn’t be too hard at this point for the NYT to kill his column permanently.