Self-Pitying Wealthy Poor: The Fancy-School Factor

The context, of course, is the University of Chicago law school professor who feels hard pressed near the top of the income distribution. (Whole series here; kick-off installment here.)

When the whiny law professor went through the household budget, major expense items were for education: still-unpaid student loans for him and his wife, who is a doctor; private school expenses for their kids. ("Since we care the education of our three children, this means we also have to pay to send them to private school," he explained in his famous original post.)

Several readers on this theme. First, about the education-bubble phenomenon in general:

>>A common theme in the whines of the wealthy is the high cost of elite education. Speaking as a card carrying member of the 200K + club, there's no way we can afford private schools for our kids. We need to save about a trillion dollars to fund the extended dementia my wife and I are looking forward to - after we lose our grocery bagging job in our 80s. (At least we didn't inherit any debts.)

If our kids go to an elite school they'll either need some pretty sweet scholarships or grad school stipends. For our part we did Wellesley and Caltech, funded in one case by unwise parents and the other by poverty. Tough luck for my kids, we are neither poor nor foolish -- and we know the limited value of elite undergraduate institutions.

Snark aside, America is clearly at the popping end of a huge education bubble -- one that's been inflating for 20 years. Once it blows the whining may tail off a bit.<<

Next, a woman who did not go to a name-brand college writes:

>>The thing that I find most fascinating is that some people seem to forget an important fact: most people don't go to private schools and most people don't go to Ivy League or otherwise prestigious universities. And yet, some of us even turn out to be successful :-)

I chose schools with generous scholarship programs and graduated with no debt. (It's a not-so-well kept secret that many small private schools cost well below the "sticker price" - my last year, there were only 15 of 1800 students paying full tuition.) In lieu of an expernsive education, my parents have spent 29 years giving me things that cost them so little but have been invaluable to me in my success thus far:
    -tenacity
    -a sense of humor
    -months of help with 6th grade math homework (I'm a math-hater turned economist, go figure)
    -adaptability
    -problem-solving skills
    -a Brit-rail pass when I worked in London
    -an intense (and possibly embarrassing) inability to procrastinate
    -strong ethics
    -organizational skills
    -good-natured bossiness
    and so much more...

   I wouldn't trade any of that for a $200K, big name education. Not in a million years.<<

Another reader says:

>>If no one else says this, or no one says it more succinctly, could you please incorporate into the discussion the implicit idea that extends across pretty much all of the posts? It basically goes like this: "once professional success is achieved, life isn't supposed to be hard or uncertain anymore". It's there in the original post and it's there in the backdoor-trickle-down economics of the east-coast lawyer. Somewhere along the last 50 years our "meritocracy" started to incorporate the idea that once you achieved a certain amount in life, you wouldn't have to try anymore.

This idea is, from my point of view (as a 30-something professional who anticipates that retirement will become an antiquated concept by the time I reach such an age) grandfather to the current state of affairs in which high school and college students expect grades to symbolize the extent of their effort rather than the quality of their work. As Clint Eastwood said snarled in "Unforgiven": "deserve's got nothing to do with it". How about we agree on this: if you need to ask yourself if you are rich (or better yet mount some kind of argument about how you aren't rich), then you probably are in fact rich.<<

And from a relatively recent name-brand-school graduate:

>>I wonder if part of the issue stems from the fact that there seems to be an implicit promise that attending one of these top schools will inevitably make you rich. I went to Stanford, and from the very beginning we were reminded of all the luminaries who also hold Stanford degrees (or at least attended classes). Larry Page came and gave a speech during freshman orientation, and Phil Knight and Jerry Yang both donated buildings while I was there. Part of the selling point of these universities is the idea that all of these great, successful, rich people went to this school, and it impacted them so profoundly that they have donated millions of dollars for its improvement. Even if you are making $250,000 or $500,000, it really doesn't seem like all that much when compared to what the people who are getting their names on the buildings make. Presumably working at a university makes this even more evident.

And in the end, you still have the same degree as these people who are actually rich. Who's to say you won't someday get there yourself? Why would you want to punish your future self with higher taxes?<<

After the jump, a way to think about student loans.

___
A reader with student loans to repay writes:

>>I wanted to weigh in on your latest, the two defenders who cited the costs of private education. I'd just like to note that these $250,000 + level professionals are getting a substantial break on their social security taxes. Every dollar of my sub-$100,000 salary is taxed at 6.2% paid by me, over and above state and federal income taxes, and 6.2% paid by my employer. In contrast, the majority of these poor, pitiable professionals' salaries are exempt from the tax. The ceiling this year is $106,800, so the rest of their salary is free and clear of this 6.2% coming out of their paycheck. To boot, the proposal is to raise their taxes on the amount exceeding $250,000, so taxwise, they have it easy, compared to the rest of us.

I also find those veiled threats of firing their servants, gardeners, etc., just reprehensible. Of course, anyone who is looking to take control of their finances has to look at the cost of retaining hired help versus doing the task themselves, and it might be a good thing for their privately-schooled children to learn to mow a lawn, but that's entirely a personal matter and shouldn't be used as a bludgeon in an argument like that. It's despicable, and it doesn't help their case, in my view.

Finally, many, many people, including myself, are paying back student loans. It's a painful chunk out of my paycheck as well. I figured at the time it was an investment in myself, and true enough, I wouldn't have the job I love today without having done it. Their student loans were a choice they made, as were mine. So, zero sympathy there as well.<<

And:

>>My dad was a law professor, and once taught at Chicago--back when wages were a lot lower, and aspirations concerning private schools were non-existent. We went to the local parish school. Just living in Chicago was an education and an adventure for a second grader. <<

More to come on education, tax, non-monetary sources of happiness, and other self-awareness issues. (Photo of Bill Gates at Harvard from here.)