Middle Class shrinkage: Cold water effect or real problem?

[thaiboxerken]

I keep hearing claims and reading articles that claim that the middle class is shrinking and diminishing, and I've heard this same line of thought since I can remember ever even caring about jobs.. so about 20 years or so. However, I have to wonder why, if this is really happening, that it seems so easy to find a middle class job? Why is the middle class still around? Is this claim about the middle class dying just fear mongering? Is the middle class shrinkage argument just a ploy to get companies to pay low-skill workers more money?

What are the real facts? It seems like everything I read on the internet about it is biased one way or another and there are very little, if any, scientific studies about this.

 

[Darth Rotor]

I keep hearing claims and reading articles that claim that the middle class is shrinking and diminishing, and I've heard this same line of thought since I can remember ever even caring about jobs.. so about 20 years or so. However, I have to wonder why, if this is really happening, that it seems so easy to find a middle class job? Why is the middle class still around? Is this claim about the middle class dying just fear mongering? Is the middle class shrinkage argument just a ploy to get companies to pay low-skill workers more money?

What are the real facts? It seems like everything I read on the internet about it is biased one way or another and there are very little, if any, scientific studies about this.

Like comments about poverty, one has to first bound the limits of the term "middle class" and then try to measure its growth or contraction by economic data. Given the very loose definitions so often used, I share your confusion with the reports: what are they really talking about?

DR

 

[thaiboxerken]

I don't know, it's like people want me to believe that our country has two categories, rich and poor. However, most people I know and interact with are neither.

 

[Darat]

In the UK we say the opposite - our working class is shrinking and our middle class is expanding.

 

[thaiboxerken]

I think in the USA the working class IS the middle class. At least, that's what the politicians say.

 

[MelBrooksfan]

I don't think even they really know outside of it sounding good if you claim to be for the poor and middle classes.

I read an article recently that detailed something to the effect of the current average two-income household makes less than the average one-income household did in the 70s. I really wanted them to show their work on that one.

 

[WildCat]

I read an article recently that detailed something to the effect of the current average two-income household makes less than the average one-income household did in the 70s. I really wanted them to show their work on that one.

Oh yeah, that great 1970's economy, who's pining for that? Double-digit inflation, high unemployment, 17% mortgage interest rates... ah, the good old days!

 

[mr rosewater]

Oh yeah, that great 1970's economy, who's pining for that? Double-digit inflation, high unemployment, 17% mortgage interest rates... ah, the good old days!

Queuing for fuel, odd and even tags, red flag-green flag. I miss thoughs days

 

[Francesca R]

I think in the USA the working class IS the middle class. At least, that's what the politicians say.

Is this the same psychology that causes the smallest coffee you can get to be labelled "tall" or "big" (followed by "bigger", "massive", "f-off huge")?

 

[Corsair 115]

Oh yeah, that great 1970's economy, who's pining for that? Double-digit inflation, high unemployment, 17% mortgage interest rates... ah, the good old days!

If I may nitpick for a moment, I believe both the inflation rate and prime interest rates peaked in 1981. Can't recall how much they were prior to that, especially in the 1970s timeframe you mention.

I also recall gold being about $800 U.S. an ounce back in 1981... to which I can only say, those poor saps who bought it at that price back then sure lost a ton of dough on the deal...

 

[NeilC]

So what classes are you supposed to have in the USA? Do you have an upper class and if so what characteristics do they have?

I even struggle to work out what "working class" in the UK s supposed to mean anymore. Do they have to work in mine or does any manual work count? I know plasterers and decorators who make more than mortgage advisors - are any of those working class or middle class? What about call centre staff? What about their managers? It all seems a bit confusing and pointless.

 

[Dr Adequate]

 

[Darth Rotor]

So what classes are you supposed to have in the USA? Do you have an upper class and if so what characteristics do they have?

Well, there is this Lamaze class men get suckered into attending. I didin't mind the first one, but I had to go through it a second time for some silly (state of CA and my wife) reason.

DR

 

[BPSCG]

David Hackett Fischer's wonderful book, Historians' Fallacies, discussed:

...that omnipresent cliche of modern European historiography, the "rise of the middle class." This group has been found rising most remarkably in every period from the twelfth century to the twentieth. It has been used to explain the Renaissance and the Reformation, absolutism and liberalism, monarchy and republicanism, conservatism and radicalism, nationalism and internationalism, fascism and communism, the commercial revoultion, the managerial revolution, the agricultural revolution, the industrial revolution, the Puritan revolution, the American Revolution, the French Revolution, etc., etc. If the middle class had in fact been rising as powerfully as this, it should presently be somewhere in the disciplinary jurisdiction of astronomers, who alone could measure its continuous ascension with their powerful instruments.

Anyone claiming to be a skeptic, whether interested in history or not, should read Fischer's book. I first learned many of the terms we throw around here so easily - ad hominem, post hoc, ergo propter hoc - from this book, when I was in college.

 

[Jaggy Bunnet]

When poverty is defined as a family of two adults and two kids who, after housing costs (and presumably therefore after tax/NI as well) have a weekly income of £301, it is hardly surprising the middle class is shrinking.

http://news.bbc.co.uk/1/hi/scotland/6681281.stm

I am also a bit confused as to how this definition ties in to the claim that the level is set at 60% of average income as I thought this figure was somewhere around £24k of gross income. How you get from that figure to £15k of income after housing costs is difficult to understand.

 

[Beerina]

I think in the USA the working class IS the middle class. At least, that's what the politicians say.

Yeah, there is no distinction of this in the US. You're either poor, as defined by a certain income amount (varied depending on whether you have a family to support, then it's "family income total"), or you're rich (not sure if it's a certain income amount and/or assets.) If neither, you're middle class, which varies wildly, from single people probably earning in the high teens or low 20's per year up through several hundred thousand a year.

 

[Beerina]

...this definition ties in to the claim that the level is set at 60% of average income

Defining the middle/poor boundary by a fraction of the average income?

What a cheat. What a rhetorical, populist political cheat.

Quality of life, as defined, say, by how much people can buy, could skyrocket until the fifty third coming of Christ, and you'd still have a bunch of "poor" people, even if they could afford their own space stations.

But for rhetorical purposes, the politicians must never, never define poor by how much calories they intake, nor how many color TVs they can afford, nor, in the US anyway, how many cars in the driveway.

 

[Beerina]

Oh yeah, that great 1970's economy, who's pining for that? Double-digit inflation, high unemployment, 17% mortgage interest rates... ah, the good old days!

I remember watching the Reagan/Mondale debate in 1984.

Reagan: You know, in 1976 [Carter/Ford contest], the Democrats created something they called the "Misery Index". It was the sum of inflation and interest rates. It stood at 12%. Four years later [Carter/Reagan contest, after 4 years of Carter] they didn't mention it because it had risen to 18%. And you know what? They won't mention it again this election, because it is down to 8%.

It was at exactly that moment that you knew that Reagan wasn't just going to win, but was going to absolutely destroy Mondale.

 

[Kerberos]

Defining the middle/poor boundary by a fraction of the average income?

What a cheat. What a rhetorical, populist political cheat.

No, it's simply common sense. If you prefer an absolute measure of poverty you should feel free to establish a baseline of for example conditions in hunter gatherer societies 200.000 years ago and declare everyone to be stinking rich, but it would be a rather pointless declaration. You could of cause also set the baseline as something that makes sense in a modern context, but then you'd really still be setting a relative standard. Unless of cause you can give some reasonable explanation for why exactly the conditions of the west in 2007 should be considered the universal baseline for poverty. I’m looking forward to you explanation for that.

 

[Ziggurat]

No, it's simply common sense.

No, it's not. It sets up a metric where poverty rates can decrease if people make less money. That's not common sense, that's perverse.