As I was betwixt and between this morning I heard a clip from President Obama’s appearance on ABC’s program, The View, that caught my attention. Here’s a transcript of the part that caught my attention. In response to the question “What would be so bad about a Mitt Romney presidency?”, the president said:
I’ll give you a very clear example. Yesterday Governor Romney on “60 Minutes” was asked, does he think it’s fair that he pays a lower tax rate than somebody who’s making fifty thousand dollars a year, and he said yes, I think it’s fair and I also think that’s the way you get economic growth, the notion being that if people at the top have more income, they’ll invest and they’ll create jobs. I’ve just got a different vision about how we grow an economy. I think, Barbara, that you grow an economy from the middle out, not from the top down, and that when the teacher and the bus driver and the receptionist and the office manager — when they’ve got a little money in their pockets, when they’re doing well, then that means business has more customers, that business makes more profits, they hire more workers, and that’s been the history of our country, we grow fastest when the middle class is doing well and when folks who are trying to get into the middle class have ladders of opportunity. So that’s a different vision about how we move the country forward, and ultimately it’s going to be up to the American people to make the decision about who’s got the better plan.
The emphasis is mine. The reason that caught my attention was the definition of “middle class” implicit in the president’s example.
The president cites four occupations: teacher, bus driver, receptionist, and office manager. Two of those are public employees (teacher and bus driver), two are either public or private employees (receptionist and office manager). In Chicago where the median household income is $38,000, teachers (who start at $48,000 and range from there to low $100K area) and bus drivers (who start at $38,000 and peak at $58,000) are middle class if you define middle class as middle income and they’re sole providers in their households. However, if they’re married with both spouses employed, they’re clearly in the fourth or fifth quintile of income earners in Chicago—upper middle income. IMO when bus drivers are paid at that rate they are grossly overpaid—the compensation reflects being unionized public employees.
Are receptionists and office managers really middle income jobs these days? Must have happened while I wasn’t looking. Every office manager I’ve met in the last dozen years is what we used to call “a secretary” and is paid commensurately however vital her work is to the operation.
From the standpoint of the work done, I would only characterize teachers as being middle class among that group. Bus drivers and receptionists are working class. Office managers would be either working class or middle class.
My point is this. “Helping middle class people” really means dramatically different things depending on what you mean by middle class. If your definition is public employees earning above the median income, raising their pay is how you help the middle class. If your definition is practically everybody else in the middle class, you help them by cutting their taxes and for many of them the most important tax they pay is FICA.
It also occurs to me that another way of helping middle class people is ensuring that there are enough middle class jobs to fill.
I’m not advocating a position on either helping middle class people or ways and means in this post. Just trying to point out the implications.