Just to avoid confusion I’m using the phrase “middle class” to indicate middle income people. I’ve discussed class before here and that’s what most people mean when they say “class”.
It’s being suggested by any number of people including the various leaks of the president’s state of the union message and Lawrence Summers that more attention should be paid to the middle class. Fair enough. Who is the middle class?
According to the IRS just about 150 million 1040s, 1040-As and 1040-EZs will be filed this year. Basic statistics tells you that each income decile includes about 15 million people.
I would call the top 1% of income earners “the rich”. That’s everybody who earns about $350,000 per year or more. I would call everybody in the top 10% of income earners other than the top 1% upper middle class (~$120,000 to $350,000) and anybody who earns between about #35,000 and $120,000 middle class. So far, so good? I realize that people’s ideas of these things differ and some want to define middle income as people within one standard deviation plus or minus of median income which I don’t think represents the reality of life in the U. S.
That means that anybody from the fourth decile to the ninth decile is middle class, something like 90 million tax returns in all. Those tax returns probably represent something like 200 million people.
Now we get to the tough part. Who are they? According to the Census Bureau there are about 22 million local, state, and federal government employees and I would propose that they’re nearly all middle class as I’m using the term. When you translate that into tax returns and population, that’s something between 22 million and 60 million, a large proportion of the middle class.
Another couple of million are professionals, e.g. doctors, lawyers, etc.
Well, I guess we fit your definition of middle class, but considering how we shit ourselves in fear whenever ANYTHING breaks down, and how I hear gunshots about 28 out of every 30 nights, it sure doesn’t feel like being middle class, certainly not like it did ten years ago.
I think that’s a highly perceptive remark that I wish more people recognized. Our problem today is that the middle class have lost the security that used to be associated with being a member of the middle class. They’re now experiencing the insecurity that used to be associated with being poor. I can only speculate on what the poor are experiencing.
I can only speculate on what the poor are experiencing.
My neighborhood is bad but improving now. Back in 2008 it hit bottom. It was scary enough that in 2007 my wife told me she wasn’t going to go to my mother’s house (our current house) even in the daytime.
But when the economy started collapsing in 2007, the neighborhood started to empty out. (I’ve mentioned all the abandoned houses numerous times.) A lot of the very worst people left, as did the poorest, to be replaced by a better class of downwardly mobile people.
(This cuts across all races, too. The neighborhood has gotten more white, but several of the improvements that I know of, especially next door, have involved decent black families replacing whites and/or hispanics.)
But I often wonder: Where did all the people GO? Where did they go that was down not from where Pine Hills is today, but from where it was then? And how bad must those places be?
But yes, the biggest thing, and the thing that the Drews of this world do not get, or don’t want to get, is that being middle class, as opposed to being poor, really involves things that have nothing to do with what kind of cheap crap can you buy at Wal-Mart. It involves security. The security of living in a safe neighborhood. The security of shopping for groceries without worrying about being assaulted IN THE STORE. The security of knowing that your children can play outside in the front-, or even back-, yard of your house without having a security detail watching over them because you live in the kind of shitty neighborhood where all the known child molesters live.
And you lose the belief that you have control over your life. That you can choose a decent school for your child. That if something breaks you will have the cash, or at least the credit, to get it replaced or fixed. That if you work hard you will be able to improve your life. That jobs will be available. That even if you are stuck in a certain situation, it’s at least tenable, and your children WILL go onto something better.
Those are all part of being middle class, the essential parts even, and a lot of it is part of what used to be working poor. And once you lose that, that’s it. I know I’ll never get those feelings of security back no matter what the future brings.
And I’ve seen that before. When I was younger I knew people that had lived thru the Great Depression that never got over it, no matter what kind of good life they had built for themselves, invariably as married couples. I knew an old woman that actually counted our the peas at dinner to make certain no one ate too many, and that she could save the rest for another meal. She & her husband would have been millionaires by today’s standards, but she died an old woman that never got over the want.
@Icepick
I would like to think that most people are insensitive because they do not understand, but you tried with the teacher’s merit pay example. At some point, it is willful ignorance, and the only way for people to learn is by example. Over the past six years, a lot of people have learned the hard way. (“I used to think like that, and then, I lost my job.”)
Once you accept being poor, it is not that bad. The tough part is transitioning. Being poor means having nothing, but that means there is nothing to take. Poor people know they are going to get f*cked, but you learn how to work the system.
Our financial system and economy depends upon credit creation (well beyond consumer credit), but this system is supported by the faith in the system. This is part of what I drone on about. (By the way, most rich folks wealth is dependent upon this faith.)
You can always get somebody to lend you money, but the interest rate will go up with a crappy credit score/rating. It does not matter how much debt you amass or how many bills you do not pay. Your debt is somebody else’s asset, and your debt is always worth something (no matter how worthless you are).
Poor people use this to work the system against itself. Middle class people find this abhorrent, but they do not understand that this is how the system must work. Jamie Dimon, Jon Corzine, Hank Paulson, George Soros, Warren Buffett, etc. understand how the system works, and they are concerned about middle class faith.
Caring about any of the middle class bullshit is like caring about voting. It is an illusion foist upon you by the sheep. They believe, and therefore, you must believe. Remember how it felt to not vote. The sky did not fall down. Two months later, the world is still as shitty as it was the day before.
I agree with your shout out to that special someone, but I have been trying to stay in my cage. Therefore, I will leave it alone.
The truth is that the security was always an illusion. The poor have it correct. You were always going to get f*cked. You just did not know it. You bought into the bullshit, and now you feel betrayed. They are still manipulating you.
“But yes, the biggest thing, and the thing that the Drews of this world do not get, or don’t want to get, is that being middle class, as opposed to being poor, really involves things that have nothing to do with what kind of cheap crap can you buy at Wal-Mart. It involves security. The security of living in a safe neighborhood.”
The Drews in this world both do and choose to get it, including that little sleight of hand in moving from economics to public safety. I think it is you who fails to get it.
I don’t place a value judgment on the quality of goods or the purchasing decisions of millions of people. I simply recognize it, restricting my value judgment to the freedom to choose. Anyone who can convince himself that trade should be restrained because Wal-Mart sells “crap” can similarly convince himself that his own wage received from the production of steel, autos, food or consumer electronics should be propped up at the expense of his neighbor. That’s just thinly veiled naked self interest.
Public safety is a different issue. And lastly, the globalization horse has left the barn. In the event we as a society attempt to redress the issue I have yet to see proposals that do not amount to simple recriminations, aiming at the wrong villain or that are worse than the disease.
“Anyone who can convince himself that trade should be restrained because Wal-Mart sells “crap—
My siblings and nieces and nephews all live at the lower end of Dave’s middle class range. They shop (and some work) at Wal-Mart. They actually appreciate the lower prices. I never hear them talk about wanting to restrain trade. I do hear worries about safety, about schools. What happens if someone gets sick. Will you lose your job if you stay home with the sick kid or can you safely leave that sick 7 y/o home by himself.
It also worries me that a lot of the kids don’t seem to have a lot of hope or ambition or whatever you want to call it. They just don’t seem to believe that there is any real chance of improving their lot in life.
Steve
So steve, finding ourselves in agreement midway through your pp 2, I ask,when were worries about the balance ever not so, what can the government do about it without benefitting Giantco at the expense of Littleco and why do our politicians spend so much time peddling a message of despair and need for government to fix it, especially in light of their track record?
You didn’t build that.
I am not sure that much can be done. As you said, globalization is aa given. Trying to manipulate labor markets to guarantee it is tighter and wages are higher seems to have its own risks. I think that we can mostly not pursue govt policy that makes things worse. Stop granting lower tax rates t some of the wealthy under the pretense it is cap gains. Stop the tax expenditures that benefit only the wealthy. While I think that will just be sibling around the edges, it would help.
Mostly I think this is just heading towards the end state of capitalism, barring major tech breakthroughs. We will head into a two tiered society. The wealthy will control the media, the govt and private enterprise.
Steve
Drew, you’ve said that the middle-class is better off because even though they make less they can buy more cheap crap from Wal-Mart. You’ve said it repeatedly. I’m saying that’s irrelevant (put mildly) because that’s not what being middle-class is about in this country.
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TB, several months later I feel great about my non-vote! My non-participation means diddly-over-squat, except that (a) I’m not giving the bastards any support and (b) I saved myself some time and aggravation by skipping the vote. My wife feels the same. We started voting in 1986 & 1990.
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TB, you’re wrong about the security situation. No one is ever completely safe, but you can be materially safer depending on where & how you live. Life is largely about playing the odds.
Funny, the people that voted are the ones telling me that nothing can be done about anything. I’m not sure that the cynicism is being properly assessed in this group!
@Icepick
I was not addressing physical security. I have lived in bad areas, and it is not easy. I always had a gun, and I always carried it whether I was legally able to or not. (tried by 12 or carried by 6) Whenever I was on the street after dark, I made little effort to hide it, but I was not out walking the neighborhood either.
Even today, I answer my door after dark with a visible .45 in my strong hand and a .357 in my back pocket, and I live in a “nice” neighborhood. My wife used to think I was crazy, but late one night, a “drunk” white girl wanted to come in and use the phone. She sobered up quick when she saw the .45. She called somebody, and then, she went to the corner to wait for her “ride”.
I am sure her boyfriend was hiding somewhere, and I wish they had tried something. The only problem would have been disclosing that there had been two dead bodies in the house when selling it, and there would have been a mess to clean up. Hollow points at close are not going to be pretty.
Financially is a different story. Did you see what happened to the Swiss franc? Denmark had to issue assurances all is well with their currency. There is a storm a-brewing, and it is not going to end well for some. The US could become a safe haven, but what is being brought into port may be worthless.
As to the globalization horse, we might find it running back into the barn. Notice how you only hear the same pablum from the financial genius, and the story only changes when the story writers create a new storyline. What is amusing is that the political operatives get the news late, and often, it has changed while the toadies are still spouting the old storyline.
Notice the schizophrenia. The investor in US manufacturing celebrates the fact that US manufacturers have been run off through regulations, but then he claims that regulations are bad. He wants to compete against foreign manufacturers, but he raves about how they are able to provide cheaper goods. (“She’s my daughter. She’s my sister. She’s my daughter. She’s my sister.” Chinatown)
Oh, no wait, it is a super secret product that only a financial genius knows how to produce in the US cheaper than any foreign manufacturer.
Chinatown
LOL, I wonder if he fucks like a Chinaman?