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Old 09-03-2009, 09:13 PM
 
Location: Seattle
1,369 posts, read 3,052,726 times
Reputation: 1496

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forest beekeeper,

Let me clarify what I mean by "implicit tax." If you have 5 kids you will pay more for a health insurance premium on the open market than you will if you have 2 kids. If your employer provides family coverage then they are eating that cost - but fewer employers are providing that type of coverage. So more and more people feel the full brunt of that 2-3x inflation increase in healthcare, hence the "implicit tax." It doesn't affect everyone but it still exists.

The "implicit tax" on education (aside from college costs that increase 2-3x inflation which is part of what I'm talking about) is in most larger cities there are neighborhoods where you live if you are raising a family, and ones that you live in if you don't have kids. The ones where you live if you don't have kids generally feature cheaper housing and often lower property taxes. If you are too poor to live in any neighborhood with good schools, or live in an area where every school district is good, or are so rich that you'd live in the good school neighborhood if you didn't have kids, this doesn't impact you. But it impacts some people, and on average it's an increased implicit tax, since real estate/housing prices have increased in good school districts cities at a higher amount over time than bad school areas.

Then you have daycare. Since it's more necessary than ever to have two incomes, you have the option of either removing one member of the household from the workforce to take care of kids, or you have to pay for daycare. This is an "implicit tax." Again, it doesn't affect everyone, if they can afford to raise a family on one income, which is much easier in rural areas, small towns and cheap living areas.

Sure, you can say, "well move to a cheap area." The thing is, around half the population of the USA lives in high cost urban areas or nearby. A lot of the above issues impact that half the population. People leaving urban centers is not the true answer to this problem. The answer to this problem is to not make raising children in any metro area with a reasonable population so ridiculously expensive. It doesn't impact people who live in small towns, rural areas, university towns, etc. nearly as much.
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Old 09-03-2009, 10:14 PM
 
Location: Conejo Valley, CA
12,470 posts, read 18,210,220 times
Reputation: 4343
Quote:
Originally Posted by Bob from down south View Post
No, you read it wrong...again. I said that in a bond dislocation scenario, a mixed bag of bonds will be as bad as a buy-n-hold portfolio of stocks.
You said nothing about a "mixed bag of bonds" and regardless that is still wrong. If you hold the bonds to maturity you are only exposed to default risk and inflation risk...end of story. Of course some bond funds do not hold things until maturity, but that is irrelevant to the point.

Holding bonds to maturity is NOT the same as holding stocks long term.


Quote:
Originally Posted by Bob from down south View Post
It's much more complex than that....
No its not, instead of requiring realistic contributions they made unrealistic projects of future earnings.


Quote:
Originally Posted by Bob from down south View Post
It's sold by many in society as a fundamental parental obligation. I challenge that assumption.
You can challenge all you want, but you've not made a strong case as to why your kids are going to be better off taking out loans vs funding their education.


Quote:
Originally Posted by Bob from down south View Post
It's far more common than you imply here. I'd like to see a credible source that only one in thousands escapes their childhood circumstances. I personally know literally hundreds who have risen from poverty in the US.
Huh? It should be pretty obvious that I'm not talking about poverty, considering I'm talking about middle-class kids that are ahem by definition not poor. I'm talking about not being a pawn.


Quote:
Originally Posted by Bob from down south View Post
The kids with paid-for educations were not spending that extra time studying.
Oh yeah? I think I get what is going on here, you're thinking of those cesspools they call state universities. Yeah most people at those don't spend their extra time doing anything productive, that's true whether they have funded educations or not. Now...lets go to the universities that are worth attending...oh wait its a bunch different world! Kids, mostly with funded educations, working a good 12 hours a day. Kids brown noising to no end making connections....


Quote:
Originally Posted by Bob from down south View Post
Yet you aspire to be one of those in power. How quaint.
I'm not too concerned with power per se, I'm just not interested in being a pawn.


Quote:
Originally Posted by Bob from down south View Post
You seem to believe that nobody in your generation has the foresight to understand the burden that paying off debt will impose. I give them more credit than that.
I never stated that "nobody" has such foresight, but the numbers clearly indicate that most do not. Its not so much a generational issue though, its a human psychology issue. In the last 100 years the only generation that was at all adverse to debt was those that grew up during the depression, it was sort of like aversive conditioning.


Quote:
Originally Posted by Bob from down south View Post
And most of the commercial artists and photographers I know (around 40-50) are being paid more in the $30K-40K range, not $70K+.
I really don't care about the people you supposedly known. The median income even for mundane art/music related fields is in the $40k range, so if you don't know anybody that makes more than this I suggest this says more about the people you know. This is not something we need to pontificate about, the government reports pretty rigorous income data.

The mean for the arts, etc is $50k, the actual arts/music related stuff ranges from a mean of $35~$50k for the more basic jobs (i.e., not director, etc). Where as the mean for all jobs is $40k, so in terms of careers the arts is middle of the road in terms of income. Don't let the facts get in the way of your old fashion thinking though.

May 2008 National Occupational Employment and Wage Estimates
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Old 09-03-2009, 10:29 PM
 
Location: Forests of Maine
32,493 posts, read 52,888,037 times
Reputation: 22288
Quote:
Originally Posted by drshang
forest beekeeper,

Let me clarify what I mean by "implicit tax." If you have 5 kids you will pay more for a health insurance premium on the open market than you will if you have 2 kids. If your employer provides family coverage then they are eating that cost - but fewer employers are providing that type of coverage. So more and more people feel the full brunt of that 2-3x inflation increase in healthcare, hence the "implicit tax." It doesn't affect everyone but it still exists.
My health care coverage includes my entire family at no extra cost.



Quote:
...The "implicit tax" on education (aside from college costs that increase 2-3x inflation which is part of what I'm talking about) is in most larger cities there are neighborhoods where you live if you are raising a family, and ones that you live in if you don't have kids. The ones where you live if you don't have kids generally feature cheaper housing and often lower property taxes. If you are too poor to live in any neighborhood with good schools, or live in an area where every school district is good, or are so rich that you'd live in the good school neighborhood if you didn't have kids, this doesn't impact you. But it impacts some people, and on average it's an increased implicit tax, since real estate/housing prices have increased in good school districts cities at a higher amount over time than bad school areas.
I have owned homes on the East Coast, West Coast and over seas; I have not seen what you describe.

How well schools are rated usually has no connection at all to the neighborhood being upper class or lower class. But it is a common perception [though false].

It is a commonly debated topic among PTAs because how well a school is rated is not connected to spending.



Quote:
... Then you have daycare. Since it's more necessary than ever to have two incomes, you have the option of either removing one member of the household from the workforce to take care of kids, or you have to pay for daycare. This is an "implicit tax." Again, it doesn't affect everyone, if they can afford to raise a family on one income, which is much easier in rural areas, small towns and cheap living areas.
I do not agree with your assumption that two income families have now become a necessity.



Quote:
... Sure, you can say, "well move to a cheap area." The thing is, around half the population of the USA lives in high cost urban areas or nearby. A lot of the above issues impact that half the population. People leaving urban centers is not the true answer to this problem. The answer to this problem is to not make raising children in any metro area with a reasonable population so ridiculously expensive. It doesn't impact people who live in small towns, rural areas, university towns, etc. nearly as much.
I do not agree with any of your points.

Within each of your points you do include that none of this applies to everyone. These are lifestyle choices that each family can make.

There is no implicit tax on children that applies to everyone. At best there may be added expenses that may apply to a few.
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Old 09-04-2009, 09:04 AM
 
5,748 posts, read 11,171,456 times
Reputation: 4504
Quote:
Originally Posted by forest beekeeper View Post
How well schools are rated usually has no connection at all to the neighborhood being upper class or lower class. But it is a common perception [though false]. It is a commonly debated topic among PTAs because how well a school is rated is not connected to spending.
I'd be interested to read more about this, because I have had very different experiences after living in various regions of the country. Any references for your assertion?
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Old 09-04-2009, 09:23 AM
 
Location: Forests of Maine
32,493 posts, read 52,888,037 times
Reputation: 22288
Quote:
Originally Posted by formercalifornian
i'd be interested to read more about this, because i have had very different experiences after living in various regions of the country. Any references for your assertion?
ot.
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Old 09-04-2009, 09:30 AM
 
5,748 posts, read 11,171,456 times
Reputation: 4504
Feel free to PM me then if you have any resources, so we can stay on-topic. I'd really like to read more.
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Old 09-04-2009, 01:28 PM
 
Location: Colorado Springs, CO
2,221 posts, read 4,882,819 times
Reputation: 1702
Quote:
Originally Posted by user_id View Post
You said nothing about a "mixed bag of bonds" and regardless that is still wrong. If you hold the bonds to maturity you are only exposed to default risk and inflation risk...end of story. Of course some bond funds do not hold things until maturity, but that is irrelevant to the point.

Holding bonds to maturity is NOT the same as holding stocks long term.
No, the mixed portfolio of bonds was something YOU brought up.

And I've never said that holding bonds to maturity is THE SAME as buy-n-hold.

Quote:
Originally Posted by user_id View Post
No its not, instead of requiring realistic contributions they made unrealistic projects of future earnings.
Oh yes, it is much more complex in the world outside the classroom.

Quote:
Originally Posted by user_id View Post
You can challenge all you want, but you've not made a strong case as to why your kids are going to be better off taking out loans vs funding their education.
One has zero student loan debt. One has low debt. Both are working their way through school, and doing quite well.

Quote:
Originally Posted by user_id View Post
Oh yeah? I think I get what is going on here, you're thinking of those cesspools they call state universities. Yeah most people at those don't spend their extra time doing anything productive, that's true whether they have funded educations or not. Now...lets go to the universities that are worth attending...oh wait its a bunch different world! Kids, mostly with funded educations, working a good 12 hours a day. Kids brown noising to no end making connections....
I've earned degrees from both a public university and an expensive private university, and your snobbery towards public colleges here is prejudicial and quite off the mark. In both cases, what you get out of it is directly proportional to what you put into it, and I didn't see students in the private university working harder. Lots of them were there simply because they had a better trust fund.

Quote:
Originally Posted by user_id View Post
I really don't care about the people you supposedly known. The median income even for mundane art/music related fields is in the $40k range, so if you don't know anybody that makes more than this I suggest this says more about the people you know. This is not something we need to pontificate about, the government reports pretty rigorous income data.

The mean for the arts, etc is $50k, the actual arts/music related stuff ranges from a mean of $35~$50k for the more basic jobs (i.e., not director, etc). Where as the mean for all jobs is $40k, so in terms of careers the arts is middle of the road in terms of income. Don't let the facts get in the way of your old fashion thinking though.
The BLS data you linked is very much in line with the kinds of incomes I have observed in the sector. $30K-40K. The "etc" includes sports figures and media figures, and skews the means upwards. When you break it down to artists, the numbers certainly aren't anywhere near the $70K figure you threw out a few posts back.
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Old 09-04-2009, 01:42 PM
 
Location: Seattle
1,369 posts, read 3,052,726 times
Reputation: 1496
forest beekeeper,

I've read some articles/papers about the idea that schools don't really matter that much (it's more about the kid) and I don't disagree with it. A few years ago I asked some high education parents the same question and most of them responded something like, "I think that may be true, but I'm not going to take that kind of gamble with my children." That pretty much sums up exactly how a lot of people feel, and as a result, they pay the premium for housing in good school districts.

Your perspective definitely describes a certain segment of the population that doesn't really believe the economics of raising kids are that poor. If everyone shared your view we'd probably have a birth rate well in excess of replacement. If everyone shared my view, we'd probably have a birth rate that's way below replacement. Since some people share my view and others share your view, we simply have a birth rate right at replacement. The fact is the economics of child rearing impact a sizable amount of the population to the point where the birth rate is becoming a serious problem.

What I've read is the only reason the US is above replacement is because Hispanic immigrants tend to have a (relatively) large number of children compared to everyone else, and they are basically "holding the fort" on the birth rate issue. The thing is, birth rates in Latin America and Africa, traditionally the two regions of the world with the highest number of kids, are dropping dramatically, and my guess is that segment of the population will eventually follow suit and no longer prop up the birth rate in the US. I think we have to raise the serious question as to why so many couples now are not having kids. Economics is certainly not the only explanation: but I think it's a major one.
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Old 09-04-2009, 01:49 PM
 
Location: Wherabouts Unknown!
7,805 posts, read 17,572,960 times
Reputation: 9435
I am enjoying the entertainment provided by two of my favorite city-data posters ( user_id and Bob from down south ) go at it head to head in this thread. Keep it ip guys. This is better entertainment than anything the media offers these days!

Last edited by CosmicWizard; 09-04-2009 at 01:59 PM..
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Old 09-04-2009, 02:45 PM
 
Location: Conejo Valley, CA
12,470 posts, read 18,210,220 times
Reputation: 4343
Quote:
Originally Posted by Bob from down south View Post
No, the mixed portfolio of bonds was something YOU brought up.
The issue is whether you hold the bonds until maturity or not, not whether you have a "mixed portfolio" of them. Contrary to your suggestion someone holding bonds large term will not suffer the same (potential) problems as someone holding stocks long terms.

Quote:
Originally Posted by Bob from down south View Post
One has zero student loan debt. One has low debt. Both are working their way through school, and doing quite well.
Again, you've yet to make a real case as to why they are better off by you not giving them money. Whether they are currently "doing quite well" is irrelevant, whether after they graduate they will be doing better is the question. There is really no way to demonstrate this though, but you could make a general case using actual data. But...alas all you have is your ideals.


Quote:
Originally Posted by Bob from down south View Post
I've earned degrees from both a public university and an expensive private university, and your snobbery towards public colleges here is prejudicial and quite off the mark. In both cases, what you get out of it is directly proportional to what you put into it, and I didn't see students in the private university working harder.
Being "expensive" does not make a private school good. There are plenty of expensive, yet relatively poor private universities. I'm talking about prestigious private schools, you know those in the top 30 or so.

And its simply false that you get the same education at a prestigious private school vs your local state college. A kid that has no other option can make the best of the state college and still learn a lot, but the education does not compare to the private school.


Quote:
Originally Posted by Bob from down south View Post
The BLS data you linked is very much in line with the kinds of incomes I have observed in the sector. $30K-40K....
No, its not. $30~$40 is the low end, yet claim you don't know a single artist/musician that makes more than this!

I never suggested the median, mean, etc salary was $70k. I said people in the field get paid "decent wages" and they do, its middle of the road. Some careers do better and some do worse. They are better paid than the vast majority of "trades".
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