Because people take their kids personally. People, rightly or wrongly, see their children as extensions of themselves. And when it comes to clothing, just as with adults, people ascribe all sorts of generalizations and stereotypes to clothing. If you wear Crew Cuts you're X, Janie and Jack you're Y, smocked dressed (apparently) and you're either an upper middle class kid from the south or a sister wife

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Honestly, I think it's silly. Dress my kid in great clothes I find at consignment stores and don't give a rat's ass what people think about it.