The Two-Income Trap: Why Middle-Class Parents Are (Still) Going Broke

by Elizabeth Warren, Amelia Warren Tyagi

Overview

From #1 New York Times bestselling author Senator Elizabeth Warren and consultant Amelia Warren Tyagi, the classic book about America's middle class -- and why economic security remains out of reach for many.
In this exposé, Elizabeth Warren and Amelia Warren Tyagi show that modern middle-class families are increasingly trapped by the grinding reality of flat wages and rising costs. Warren and Tyagi reveal how a ferocious bidding war for housing and education has silently engulfed America's suburbs, driving up the cost of keeping families in the middle class, and placing unprecedented pressure on hard-working families.
Revolutionary when it was first published in 2003, The Two-Income Trap remains disturbingly relevant today. Now with a new introduction by the authors, The Two Income Trap shows why the usual remedies won't solve the problem and points toward the policy changes that would create better opportunities for both parents and children.

Product Details

ISBN-13:	9780465097715
Publisher:	Basic Books
Publication date:	04/12/2016
Sold by:	Hachette Digital, Inc.
Format:	eBook
Pages:	288
File size:	3 MB

About the Author

Elizabeth Warren is the Leo Gottlieb Professor of Law at Harvard Law School. She is the co-author of As We Forgive Our Debtors and The Fragile Middle Class, as well as three leading commercial law casebooks. She is vice-president of the American Law Institute and served as Chief Advisor to the National Bankruptcy Review Commission. She lives in Cambridge, Massachusetts.

Amelia Warren Tyagi has worked as an Engagement Manager with McKinsey and Company, specializing in health care, insurance, and education, and she co-founded the successful healthcare start-up HealthAllies. She lives in Pacific Palisades, California, with her husband and two-year-old daughter, Octavia.

Table of Contents

Introduction to the 2016 Edition xiii

1 Just the Way She Planned 1

2 The Over-Consumption Myth 15

3 Mom: The All-Purpose Safety Net 55

4 The Myth of the Immoral Debtor 71

5 Going It Alone in a Two-Income World 97

6 The Cement Life Raft 123

7 The Financial Fire Drill 163

Appendix 181

Acknowledgments 189

Notes 193

Index 247

Editorial Reviews

Warren, a law professor at Harvard (The Fragile Middle Class) and her daughter Tyagi, a former McKinsey consultant, have joined forces here to argue here that the two-parent middle-class working family is on the brink of financial disaster. The number of families declaring bankruptcy or receiving a foreclosure against their house has shot up dramatically. Presenting carefully researched economic data to support their arguments, the authors contend that, contrary to popular myth, families aren't in trouble because they're squandering their second income on luxuries. On the contrary, both incomes are almost entirely committed to necessities, such as home and car payments, health insurance and children's education costs. When an unforeseen event such as serious illness, job loss or divorce occurs, families have no discretionary income to fall back on. The authors recommend a number of useful societal solutions to get families out of this trap, such as legally prohibiting credit card companies from charging grossly unfair interest rates and exposing banks that employ a loan-to-own strategy that steers minority customers to higher mortgage rates with an eye to future foreclosures. Warren and Tyagi point out that families buy homes they cannot afford in order to live in a neighborhood with better schools. Their proposed solution, however-to institute a public school voucher system with wider choice-is less carefully thought out. Overall, however, this is a needed examination of an emerging social problem. (Sept.) Forecast: The authors are hitting on issues felt by many Americans, and this book-with an author tour and 40-city radio satellite tour-is sure to be discussed. But its bleak warning may not drive readers to the bookstands. Copyright 2003 Reed Business Information.

Publishers Weekly

"A startling account of the elusiveness of the American Dream."—Time Magazine

"A wonderful book. . . . Revelatory."—Paul Krugman, New York Times

"Brimming with proposed solutions to the nail-biting anxiety that the middle class finds itself in."—Wall Street Journal

"A well-researched road map of where we are, as well as viable escape routes."—Boston Globe

From the Publisher