William Tucker’s “A Return to the ‘Family Wage'” (May 13) is one of the best pieces I have seen on the real reason people are unhappy with the economy in spite of the relatively good economic indicators. When it takes two breadwinners to support a family as well as one breadwinner could a generation ago, people feel that their standard of living has gone down.
I could suggest a number of reasons why middle4ncome wives have entered the work force in exchange for a relatively small increase in net household purchasing power. But one major factor is the government subsidy of home ownership.
Under Fannie Mae and Freddy Mac guidelines, lenders look at taxable household income in order to determine qualifications for loans. Even if there is no net cash-flow benefit from having the lower-income spouse working, the income of the second wage earner is a necessity to qualify.
The explosion of two-income households corresponds with the pattern of rising housing prices. People bid up the price of homes in expectation that the prices would rise. Also, as Tucker pointed out in his book The Excluded Americans, local governments took steps to ensure rising housing prices through land-use laws, zoning, and add-on costs to builders. This benefited high-income and established home owners, but hurt low- and middle-income people. They felt compelled to send a second wage earner into the work force.
I doubt that any of the proponents of government housing policy intended to destroy the family-wage system. It is an example of the law of unintended consequences.
George L. O’Brien San Francisco, CA
