$75k household income with kids is a pittance in pretty much all areas of the US that have seen economic growth in the past few decades. Most people are simply skipping saving/investing sufficient funds for their old age/emergencies (a few million by 65, but I would say you need decent portion by 50 since likelihood of being unable to work starts going up a lot).

This is part of the reason birth rates are down.

And why the pyramid scheme is going to collapse, unless we can continue to undercut our own workers with cheap/static cost immigrant labor.

Singapore has entered the chat with the lowest birth rate in developed nations despite massive leverage of cheap foreign labor.

I mean, that makes sense. The immigrants are there to replace all the missing kids (as well as unskilled workers).

The workers were there before the lack of kids.

What's interesting is birth rates say otherwise. The wealthier you are the lower your birthrate. People that can certainly afford to have many children are not where as very low income people are having many. I think it's something more than people feeling like they can't afford it.

https://www.statista.com/statistics/241530/birth-rate-by-fam...

Birth rates for lower incomes are plummeting too, so I think it is mostly lack of access to birth control like IUDs and pills, but also lack of women’s financial independence.

https://www.statista.com/statistics/562541/birth-rate-by-pov...

Possible causality inversion? People have more money because they chose to not have kids, all else being equal.

per the article's central thesis. If Income inequality changes direction births will rise.

Unlikely. Educated, empowered women with access to family planning facilities have less children if they have any children at all. Birth rates in developed countries with more robust social safety nets and less inequality have total fertility rates below that of the US.

https://ourworldindata.org/fertility-rate#what-explains-the-...

More likely than unlikely.

> Educated, empowered women with access to family planning facilities have less children if they have any children at all

This has nothing to do with wealth inequality. This does have to do with optimizing for wealth accumulation. Possibly something to do with Quality of Life, wherein children used to improve it comparatively, while now they are more of a risk proposition. For people in poverty, they are a (subsidized) source of income, which is unfortunate.

What's interesting though as that households with over $200,000 in income have the lowest birthrate of all. The highest birthrates are in households with very low income. In essence, for every dollar of household income you have, your birthrate decreases.

I suspect birthrate’s biggest factor is women’s financial independence and access to cheap and convenient birth control such as IUDs and birth control pills.

Birthrates are plummeting even for low income households, and I would bet it has something to do with Affordable Care Act of 2010 greatly increasing access to birth control by making it free. From the women I have spoken to, it is almost a no brainer to get an IUD.

https://www.statista.com/statistics/562541/birth-rate-by-pov...

I think societies are about the find out the real price of having babies now that they are not simply a byproduct of sex or women not having power.

> I think societies are about the find out the real price of having babies now that they are not simply a byproduct of sex or women not having power.

Can you expand on that, I'm not sure I follow?

Up until a few decades ago, women did not have a nearly foolproof way of preventing pregnancy while still being able to have dec. As well as having the power (financial independence) to say no to anyone pressuring them into getting pregnant. So now, the fertility rate will more accurately reflect a woman’s desire to get pregnant (at a certain age, at a certain income/wealth, given a certain set of possible partners, given a certain number of other children they already have, in a certain culture/time).

The caveats in the parenthesis are almost unnecessary though, since we are seeing declines in birthrate across all incomes/wealth levels around the world. I think we will see very, very few women choosing to have more than 3 kids, or even 3 kids. I actually only know of 1 couple with 3 kids, everyone else has 0, 1, or 2, and I am in mid 30s.

Decline in birthrate is a good thing, especially if we combine it with the reduction in mortality, and hopefully slowing aging and reversal of aging.

I suspect high income >200k/yr households are also highly correlated to high CoL locations. If you live in an SF 1 bedroom that costs 1.5 million dollars the marginal cost of an additional child is likely to be over a million dollars in the first 10 years of life. A family with exactly 200k/yr is at the entry point for financially achieving what would have traditionally been viewed as a middle class financial situation in the US e.g. owning a home, funding a retirement, taking regular vacations, paying for children's college etc. Even 1 child in a high CoL location can jeopardize these goals.

A relevant number would be the difference between income and the marginal cost per child.

There is a crossover point somewhere on the income/QoL scale where children go from utility to liability.

It's incredible recently, and still only in some countries, where children are in the liability area. By and large for all human history, children where a utility. More or less free labor to help support the family.

"Also, with 75K, sounds like you would have ample amount to invest."

Depends on location and if you have a family. $75k for a single person in an average area will provide a fair amount to invest. $75k for a family of four in most suburbs is going to be tight. In either case, the value available to invest is substantially less that high net worth individuals and will limit many investment opportunities (private equity, accredited investor status, and likely not making enough to take advantage of mega backdoor Roth).

== So you can say that 30% of your consumption goes directly to land use, because cars need infrastructure and because we refuse high density housing and increased barrier for new housing supply.==

Aren’t the most dense and transit friendly places also the most expensive (SF, NYC, etc.)?

Density is part of the equation, but you need to keep increasing housing supply. Ditto for transportation investment.

Trains are very cost effective method of transportation, but it doesn't mean squat if fare is high and demand is overwhelming.

Where in the US are middle class families getting away with 12% in taxes?

Yeah at $75,000 your effective tax rate is around 17% in most states with state income tax and probably around 15% in states that do not.

Of course this doesn't cover property tax, sales tax, etc.

This is a handy calculator to calculate effective tax rates:

https://smartasset.com/taxes/income-taxes

That page is not exactly neutral though: it includes FICA (not completely unreasonable, though maybe uncommon) and includes FICA in Household Income (who knows their income with FICA included?).

Blue collar worker in non-income tax state that doesn't own property and has 2-3 kids is probably going to be around 12-15% overall. That's a pretty small subset of the country, 2-3 states or so. If you use the same book of tricks (i.e. ignore a myriad of local taxes and taxes collected on goods sold) that people around here typically use when trying to make certain high tax states look not too out of line with the national average then huge swaths of the south and midwest would be included.

>If you use the same book of tricks (i.e. ignore a myriad of local taxes and taxes collected on goods sold) that people around here typically use when trying to make certain high tax states look not too out of line with the national average

It really irks me when people do that. They also conveniently leave out items such as the average cost of electricity or gas prices.

There are 8-9 states without income tax, not 2-3.

Some of those have other taxes that are high to make up for it hence why I said the number where the all things considered tax burden is down at 12ish percent is probably low single digits.

income tax rates in the US are pretty low, especially compared to the rest of the world. Even if your income crosses into a high bracket, you only pay the higher rate for anything above the threshold, so your effective rate is much lower often. the In addition to various benefits and other programs to help families. There is ton of assistance and other programs.

Median household income in the US is $80k/yr. If you live in say Houston or Orlando a married couple will pay $6,230 in federal income tax + $6,120 in FICA for a total of $12,350 in taxes or 15.4%. If they have children, they will pay less.

A lower middle-class couple with similar circumstances making $50k will pay 12.9% in taxes.

This doesn't take into account property tax, sales taxes, fuel taxes, car registration fees, etc.

> Median household income in the US is $80k/yr.

No, its not, its about $65K. Though Google’s Knowledge Graph pulls a snippet about the structurally higher median family income if you search for median household income.

Plenty. States with low or no income tax, add in SALT and mortgage interest plus 401k deduction. Then tax credits.

My brother mentioned he was paying around 10% as a single person with a $50k income a few years back.

With housing, cause and effect probably runs the other way. It’s seen as a good investment and soaks up monstrous amounts of capital, and for that machine to work and Calpers to pay pensions, housing prices must always go up.

> Eh. Part of the reason is that living in the US is just plain expensive.

This is backwards. The point of the article and the GP is to explain why it's expensive. Reason seems to be low rates -> assets inflate. Naturally those assets tend to be in the hands of older/wealthier people.

Part of it. The inability to increase housing supply meant that the inflation of home value cannot be blunted.