In my post Lifestyles of the rich and oblivious I wrote about the complaints of people like Andrew Schiff who felt that he could not live as he wanted to in New York City on $350,000 per year. To no one’s surprise (except perhaps to people who move in the same circles) he received a huge negative backlash. He has gone on a kind of media tour to try and repair the damage and explain in more detail his difficulties.
Some have been sympathetic to his claim that New York is so expensive that he needs a level of income that few can even dream of but Felix Salmon, finance writer for Reuters, is having none of it. Salmon dissects their claims one by one. He points out that:
If you’re a financial professional, New York is arguably the cheapest of the world’s financial centers. And most major non-financial cities are more expensive than New York, too.
According to Mercer’s annual cost of living survey, New York lies somewhere between Brisbane and Brasilia, and is significantly cheaper than the likes of Milan, Tel Aviv, Melbourne, Seoul, and, of course, London. And it doesn’t even come close to Sydney, Rio, Hong Kong, Singapore, Geneva, Moscow, or Tokyo. Complaining about the cost of living in New York is the ultimate in parochialism: New York might be expensive by US standards, but it’s definitely cheap by global-city standards.
Salmon also has little patience with the most frequent complaint, that private school for their children costs so much that it leaves little left over.
If you’re a connoisseur of rich people’s whines you’ll be intimately familiar with the idea that they don’t have much money left after paying for expensive things in general and private school in particular. But sending your kids to private school is the epitome of upper-class snobbishness and elitism, and nobody who does it should ever be allowed to kvetch about their straitened circumstances. After all, they’ve already paid, with their taxes, to send their kids to public school. But their local public school isn’t good enough for little Muffy — in large part because all the rich parents in the neighborhood send their kids to private school instead, and therefore the local public schools aren’t getting the benefits of a significant cohort of affluent, educated, and engaged parents.
What’s more, if you send your kid to public school and augment her education with anything near $32,000 worth per year of books and travel and experiences and even private tutoring, she’ll end up extremely well educated. After all, when you look at studies which adjust for socio-economic status, there’s very little evidence at all that private schools provide a better education than public schools. Indeed, the evidence shows the opposite: that middle-class kids who grow up with two well-educated parents and lots of books around the house will generally do very well in school no matter where they go. Which means that the only real reason to send Muffy to private school is to ensure that she only hangs out with rich kids.
The point about education is interesting. Salmon is right about the importance of certain practices when it comes to education. When parents have had good educations or otherwise attained high levels of literacy, and children grow up in a home environment where there are books, newspapers, and magazines lying around that are read, are taken to the library and to cultural events, engage in serious conversations and so forth, such things have considerable positive effect on children’s attitudes towards learning. (I explore some of these issues in my book The Achievement Gap in US Education: Canaries in the Mine (2005).) Part of the reason why poor children underachieve in schools is that their parents often struggle with multiple jobs and have little time left over to do those kinds of things. The simple fact that when I get home, I can put up my feet and read newspapers and books gives my children an educational advantage.
We live in an inner ring suburb of Cleveland. It has a good public school system that is diverse ethnically (about equal numbers of black and white students with a smattering of other groups) and is also mixed socio-economically, though tilted towards the high end, ranging from families on welfare to high-powered corporate types. Despite this, some of the affluent people of all ethnicities in our suburb do forego the public schools and send their children to private or parochial schools, some of which are very expensive. By scrimping and saving we too may have been able to cobble together enough to send our children to private schools but the thought of doing so never even crossed our minds. Our children went to the public schools and did just fine and the money we did not spend on private schools enabled us to pay for their college educations. Furthermore, I think that growing up with a diverse group of students in school made them as adults far more comfortable in dealing with diversity in their workplaces and social lives.
The whining of rich people like Schiff essentially boils down to saying that once they have spent tons of money on things that most people cannot conceive of doing (sending their children to private schools, having second or even third homes, joining country clubs, going on expensive and extended vacations) they have, by their standards, very little money left over for ‘living expenses’, by which they mean money to go out regularly to eat in fancy restaurants or frequent Broadway shows.
What is most surprising is that they are surprised that the rest of us are not sympathetic to their plight.