From the library: Dream Hoarders, by Richard V. Reeves

So here’s how I spent the 4th of July:  I spent the morning being lazy, ultimately getting around to the overdue bill-paying, then, in the afternoon, logged on and put in some work hours while my youngest son was playing at a friend’s house (the older two and my husband are away on a Boy Scout trip), and in the evening watched Chess in Concert (that is, the DVD from the library) – great music, muddled plot – and just now decided to suck it up and borrow The Dream Hoarders as an e-book, having blogged about it already but still being on the hold list for the paper copy at the library, even though as a general rule I hate reading e-books, and now feel obliged to make notes as I go because the e-book format doesn’t lend itself to flipping through to summarize afterwards.

So to start with, Reeves defines his targets as the “upper middle class” – households with income above $112,000, the top quintile – and says that, despite our hand-wringing over the top 1%, the top 20% have actually done very well for themselves in recent decades, for a couple reasons:  education/skills have become hugely important,UMC households are, in general, very stable with much lower rates of divorce/single parenting, and assortive mating means that high-income men are increasingly paired with high-income women.  The affluent are also increasingly likely to live in income-segregated neighborhoods, and in a variety of other ways, including health and life expectancy, they are pulling away from everyone else.

Reeves then traces the advantages that UMC children have relative to the poor:  to begin with, they are the product of planned pregnancies, and mothers who make special efforts to ensure their and their babies’ health.  These parents spend more time talking to their preschool and school-aged children, they supervise their homework, they teach them a strong work ethic.  They provide enrichment opportunities – books, trips, and so on.  Educated mothers are even more likely to stay at home and parent full-time than the economic models say they “should.”  UMC parents are also more likely to choose a school for their child other than the default neighborhood public school, or to choose homeschooling; by high school, 18% of UMC children attend a private high school, vs. 9% for the middle 40% and 4% for the bottom 40%.  Of those at public schools, they are (no surprise) disproportionately likely to be living in school districts with high-performing public schools with higher-quality teachers.    UMC parents are also more likely to volunteer at their children’s school and support PTA groups.

(Note that Reeves says that he is “blown away by how good the teachers are” at his children’s public high school, but he subsequently references his child having attended school in Bethesda, Maryland.  This was ranked by CNN as the nation’s “top earning town” in 2012, which suggests that, whatever his data may show about the top quintile, his own perceptions in his daily life are warped and he perceives this group as more moneyed, on average, than they actually are.)

Upon reaching college, UMC children expect not just to get a four-year degree, but surveys show half expect a graduate degree too.  And private schools have the resources and connections to help students get admission where they want.  In addition, “many affluent parents hire college admissions consultants.”  (Yep, looks like an instance where the people Reeves knows in his everyday life warp his sense of what “upper middle class” life is like for most people.)  The net result:  statistically, 60% of UMC children get bachelor degrees by age 25, compared to 33% of the middle 40% and 10% of the bottom 40%.  (To be honest, while there is a clear difference, it doesn’t make Reeves’ case as strongly as he thinks, if 40% of UMC children don’t succeed in fulfilling their parents’ expectations.)

Reeves then addresses the type of college those kids attend, and, to be sure, UMC children are far more likey to attend Ivy or other elite schools, or selective schools in general (though as I’m learning, “selective” schools have a pretty wide definition, as nearly all four-year schools seem to have this label).  To be honest, I can’t get all that upset about the question of whether UMC children are disproportionately likely to attend elite schools, given that fewer than 10% (eyeballing a graph without numbers) of UMC college-attenders do so in the first place.

What’s the end result?  Income mobility has been decreasing in recent decades:  poor children are more likely to become poor adults, and UMC children, to be UMC adults.  Reeves writes, “if you really want a fairer and ore socially mobile society, there is no avoiding an uncomfortable, attendant fact.  More of our own kids will have to be downwardly mobile.”  Of course, this is measured purely in terms of relative wealth, and it is true that poor kids rise to the top quintile without some in the top dropping down — but, at the same time, this is only an issue if we’re measuring relative wealth distribution.  There’s no reason why overall income levels in the country can’t increase, and the percentage of people earning a “middle-class income” in terms of ability to afford “middle class comforts” can’t increase, even if, measuring by quintiles, you can only ever have a fixed share of the population in these groupings.

At the same time, Reeves does have a fair point when he writes:

My intuition is that upper middle-class adults would be more supportive of redistributive policies and institutions if they were less certain where there own children – and by extension, grandchildren – were going to end up. . . .

As the consequences of falling out of the upper middle class have worsened, so the incentives of the upper middle class to keep themselves, and their children, up at the top have strengthened. . . .

A vicious cycle has been created.  Rising inequality means that those who fall out of the upper middle class have a longer drop.  Parents, then, have both the resources and motivation to put a glass floor underneath our children, doing whatever we can, including hoarding opportunities, to reduce their risk of being downwardly mobile.

Finally, in chapter 6, Reeves gets to the three actions that he calls “opportunity hoarding”:  exclusionary zoning, unfairness in college admissions, and the allocation of unpaid internships.

Now, Reeves is careful to say that there is a real difference between good parenting and all the workaday efforts to ensure your kids are well-prepared for life, and “opportunity hoarding,” which “takes place when valuable, scare opportunities are allocated in an anticompetitive manner:  that is, influenced by factors unrelated to an individual’s performance.”

“Exclusionary zoning” is hoarding because “many local ordinances, especially those containing strict rules on density, are anticompetitive barriers around the borders of upper middle-class neighborhoods.”

Now, I believe that density restrictions are harmful because they escalate the cost of housing across the board unnaturally, but that doesn’t seem to be entirely what Reeves is getting at, and his label of “hoarding” seems on shakier ground:

Economic sorting at the neighborhood level leads to social sorting in terms of schools, churches, and community groups.  This means fewer interactions and social ties across social classes.

In other words, if I follow him correctly, what’s being hoarded isn’t the ground upon which housing could be built, but the UMC, in segregating themselves, are hoarding all the social capital, the connections, the “I know someone who works in that field you think you’re interested in” opportunities.

Reeves’ second type of hoarding is around college admissions. UMC applicants are advantaged in multiple ways:  students who visit campus (more possible, for prospective students from out of state, if you’ve got money) are favored, students who apply early (which Reeves suggests isn’t possible if you need financial aid – I think he’s talking about an elite school version where you have to commit to the school right away) are advantaged.  Students where one parent is an alumnus/a or a donor are advantaged.

Apparently, though, colleges don’t report the sort of data that would make it possible to document the effect that legacy preferences have, with few exceptions — he provides a table showing that admission rates for legacies at Harvard, Yale, Princeton, Georgetown and Stanford is 2 – 3 times higher than the general admission rate.

Now, maybe in Reeves’ world, it’s a really big deal for kids to attend these elitest of the elite schools, so that his perception is distorted. I just don’t care all that much whether these schools want to preserve “family traditions” of attendance, as is the case around here with the clearly less exclusive but still clearly selective University of Notre Dame.  The much bigger issue is not what families do but the fact that too many employers grant their own preferences for graduates from these elite schools, meaning that, from what I understand, admission is really all that matters to be virtually guaranteed at least a major leg up on a high-paying career.

Reeves’ third hoarding is around jobseeking.  He starts with the abominable “take our kids to work day” (which was bizarre from its very conception – why do children of UMC women need help envisioning at a young age having a career as an adult?) and rightly mentions that children learn very little by visiting their own parents’ workplaces, and moves on to railing against the unpaid internship.  Here his data seems a bit out-dated, citing a 2011 book (Intern Nation) and a 2012 survey, then muddying the argument a bit more by mixing together internships at auditing firms and Goldman Sachs (these are surely all not just paid, but far better paying than a typical summer job a college student might have, and likely selected through a formal campus interviewing process rather than “I know a guy”) and internships at government agencies.

Now, yesterday I spent more time than I should have trying to find a blog post that I thought I had written on the topic, but this was in the news a couple year ago, and I thought the government was increasing its enforcement of the relevant wage laws, which prohibit for-profit entities from hiring unpaid interns.  But Reeves’ instances of unpaid internships unfairly doled out to the connected are predominantly internships in government offices — New York City Hall, the White House, Congress, etc., which means that this really turns into a matter of good government, or lack thereof.

So we’re nearly at the end of the book, and these three items seem, in the end, relatively small.  What’s odder is how he ends the book, with four other “solutions” that have nothing to do with “hoarding” but are simply ways to spend more money  with the objective of improving outcomes for poor kids:

• Reduce unintended pregnancies through widescale use of LARCs (long-acting reversible contraceptives) such as IUDs and implants.
• Increase home visiting to improve parenting (that is, by encouraging poor moms to talk to their kids more, and the like).
• Get better teachers for unlucky kids.
• Fund college fairly, in part by “elevat[ing] the status of vocational postsecondary learning,” increasing funds for community colleges, building up apprenticeships, curtailing tax breaks for wealthy colleges, and canning the 529 plan tax break.
• And, finally, raise taxes on the top 20%, both with tax rates and elimination or reduction of tax breaks like the mortgage interest deduction.

So that’s that.  In some ways, it’s a much bigger proposal — “the top 20% should pay much more in taxes than they do now” but in other ways, it’s weirdly narrow, since, in the end, he only has three concrete examples of “opportunity hoarding,” one of which, exclusionary zoning, doesn’t really seem to fit in any case, and the other two really seem to be much more of an issue in the very-upscale world in which he lives.

It’s almost like what one of my subpar blogposts would be like, if turned into a book — trying to take one idea that I think is, if not particularly clever, than at least unique enough to be able to differentiate what I’m writing from everything else that’s out there, so as to avoid that sort of blogpost that reads, basically, “here’s an except from someone else, and, by the way, I agree with her.”

Image: By Raysonho @ Open Grid Scheduler / Grid Engine (Own work) [Public domain], via Wikimedia Commons