How Much Money Defines Middle-Class?

The story making the circuit today about Presidential candidate Mitt Romney is this: “According to his response to a question about whether or not he considers “middle class” income for Americans to be somewhere around “$100,000” by ABC’s George Stephanopoulos on Friday, Romney rejected that number. “No,” Romney said. “Middle income is $200,000 to $250,000 and less.” Really? According to the latest report from the Census Bureau, 4% of all households in American earned more than $200,000 in 2011. Or put another way, 96% of American households earned less than $200,000. Does not sound like the middle to me. Census Report: Click Here What might be a better measure? In Table A-1, Households by Total Money Income, the Census reports that: the median household income (that is, the income where 50% of the population is above and 50% is below) is $50,054. This is less than the high of $54,546 in 2007; since the economic crash, median income has been on a downward slide since 2007 and has not bottomed yet. Of course, we could look at the mean (average) household income. That is higher at $69,677, but still shows a decline from a peak in 2006 of $74,259. Generally, when dealing with income, the median income is a better description of where the middle is; averages can be distorted by very high earnings. Still–$54,00 or $69,000 is a long way from $200,000. Another way to figure out where the middle-class resides in the household income distribution, is to look at the percent of people in the different categories. What percent earned $200,000 or more? 4%. Another 5% earned between what happens when a girl takes viagra $150,000 to $199,999 and 12% earned between $100,000 to $149,000. So, adding them up, 20 percent of the households earned $100,000 or more in 2011. This is not the middle, so, George had it wrong too. Folks in the highest quinttile (top 20%) might not like to think of themselves as upper class, but there they are. Of course, $100,000 may not go as far was folks would like in terms pharmacycanada-rxedtop of meeting all their families’ financial obligations, but they had more income than the 80 percent of the households who earned less, and much more income than the 25 percent who’s household income was less than $25,000 . Looking at the Census data, if I had to chose one category it would be the 18 percent whose household income was between $50,000 to $74,999. That’s the middle. We could call the 14% earning between $35,000 to $49,999 the lower-middle class, and the 12% earning $75,000 to 99,999 the upper-middle class, if we wanted to broaden that middle-income category. I find it curious that there is a desire to label those who earn between $200,000 and $250,000 as something other than upper class, rich, or wealthy. Even Romney seems to think calling the top 4 percent “upper class” is somehow a bad thing. To be fair, President Obama also seems to trying to call people who earn less than $250,000 middle class too. This labeling most likely has something to do with tax cuts for the “middle class”– if we call everyone who earns less than $250,000 middle class, it means that the tax cuts would fall on a very small percent of household. No doubt it would raise a lot of money, but still, the very wealthiest might not think this is a fair or shared sacrifice. This is a political issue that will be resolved through the political pharmacycanada-rxedtop process, so stay tuned. From a research perspective, however, 96% of American households cannot reasonable be called middle class. But is “middle-class,” or even upper or lower class all about income? Is it possible that some people with low household income own their is there a generic form of cialis own homes in middle-income neighborhoods? Are there other ways to define middle-class besides household income so researchers could determine how many people are in fact in the middle-class? Going deeper, is “class” even the right word here? Low income, middle income and high income might be more straightforward descriptors–and clearly, that is what the data from the Census is about. What does “class” mean? Operationalizing terms can be challenging.      

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