Middle Class Strife
- By Simple Politiks
- 2 September, 2012
- 15 Comments
From 2000 to 2010 virtually all socioeconomic classes have suffered to some degree. The middle class, however, has taken the biggest hit. In fact, the most recent decade has been the most financially unstable for the middle-income tier since World War II.
That’s all very shocking, but who qualifies as middle class? Who am I referring to, specifically?
In addition to looking at a “statistical middle” derived from government data, this report looks at those who self-identify as middle class, based on a Pew Research Center national survey of 2,508 adults. In the survey, 49% of adults describe themselves as middle class; 53% said the same in a similar survey in early 2008, when what is now known as the Great Recession was gathering steam. That recession, according to the National Bureau of Economic Research, began in December 2007 and ended in June 2009.
The 2012 survey finds an increase in those who self-identify as being in the lower or lower-middle class—32% place themselves in these categories, up from 25% in 2008. And 17% now say they are in the upper or upper-middle class, down from 21% in 2008.
Noteworthy patterns by race, age and gender are present in all of these self-categorizations.
Similar shares of whites (51%), blacks (48%) and Hispanics (47%) say they are middle class, even though government data show that whites have a higher median income and much more wealth than blacks or Hispanics.
Adults ages 65 and older (63%) are more inclined than all other age groups to call themselves middle class and less inclined to say they are lower class (20%). Meantime, younger adults (those ages 18 to 29) are more likely to say they are in the lower or lower-middle class; fully 39% say this now, compared with 25% who said so in 2008.
Men (46%) are somewhat less likely than women (53%) to include themselves in the middle class. In 2008, a somewhat larger share of men (51%) said they were middle class, and 54% of women said they were.
Here is some data you should know about these people who identify themselves as middle class:
1. 85% of all the individuals who identified themselves as middle class say the that it is more difficult to maintain their standard of living now than it was a decade ago.
2. In 2010, the upper-income tier took in 46% of the nation’s household income, up from 29% in 1970. The middle-income tier took in 45%, down from 62%. This is a difference in 17% with both tiers.
3. Even though the economic downturn (AKA “The Great Recession”) ended a few years ago, middle-income families are still feeling economic hardships. Roughly 62% reported that they had to reduce household spending in the last year. In 2008, this figure was 9% lower at a 53%.
4. 44% say they are more financially secure than they had been 10 years ago, and 42% say less. (An additional 12% volunteered that it’s about the same.)
5. And finally, below is a chart which shows the demographics of the middle-income group:
All statistics were taken from this Pew Study
Copyright © 2013
There is no “good news” on the horizon economically for Americans. The unique conditions that gave birth to the middle class are over, but, too few are alive today to see it and our knowledge of history, at least the economic history of mankind, is negligible to put it kindly. To put it bluntly, a “middle class” isn’t normal. It existed for a brief period of time because, thanks to unions, good public education and demographics, the rich had no choice but to pay the poor a living wage if they expected to get a decent return on their investments. It was an accident of time, place and economics, nothing more. If you have to pay $1.00 an hour to an employee so that his/her labor will provide you with $2.00 in profit, or even $1.10… you will because you have no choice. America was, more or less, a closed system with abundant land and resources. But, those days are gone.
Today, outsourcing work to people thrilled to earn $1.00 a day and return you $5.00 in profit is and will remain the only logical way to go if you want to get, or stay, rich. The rules of the game have changed, or, more accurately, gone back to normal. Money will always be invested where it can produce the highest return, regardless of what that means to any local population or economic class. It was a great and giddy ride for Americans lucky enough to have had a ticket and to have been born at the right time and in the right place. But, it’s over. Profit produces jobs, not politicians.
Forget the charts, speeches and political rhetoric… you know it’s over when the young, who haven’t even started working yet, owe more to bankers in college loan debt than the combined credit card debt of the entire country. HA! If that isn’t an economic kick in the groin to a whole generation I don’t know what is. Good luck kids… you are going to need it!
Perhaps it’s instructive to understand that all countries and cultures have always had a “Two-Party form of government. The Winners & Losers. In America the Winners are the Republicans and the Losers are the Democrats. Historically, for thousands of years, the Winners have championed religion because nothing keeps the peasants in line more than the guarantee that everything will be straightened out in the end. But, that’s not the best thing the Winners have going for them. Their greatest asset is the inescapable reality that even losers hate losers and can be guaranteed to vote, against their best interests, for Winners because that is who they “wish” to identify with.
My advice…. Seek a marketable skill, stay out of debt, be kind to your parents and hope they leave you the house in their will. Oh, and look around. Notice that money doesn’t buy happiness and that “things” end up owning you, not the other way around. Capitalism, the game of Monopoly writ large, only ever ends one way, no matter how much fun it seems in the beginning.
Have you read the book The Conscience of a Liberal by Krugman? I read it after reading The Conscience of a Conservative by Goldwater and it was very informative. Krugman goes into detail about the rise and fall of the middle class so if you haven’t read the book yet then I highly suggest it.
Thanks for the contribution! A lot of good stuff in this one.
Good post. From anecdotal evidence, I have witnessed in my former company, clients and read in the papers the annual or biennial RIFing process that goes on where hundreds and thousands of people are “reduced.” In my former company where I worked fifteen years, I counted at least 25 RIFs from various departments over the years. Leaders cannot make their numbers and are so removed from the business, so they do not know how to grow revenue. So, they end up cutting to save their own necks. My old company used to do the RIFs in November – why? Because by RIFing people before the annual raises, they could spend lesser dollars in the salary increase budget. This became exacerbated when the economy turned, but this RIFing process went along with outsourcing dating back to the early 1990′s. So, the RIFed get jobs, but usually settling for less given the market dynamics – it is easier to get a job when you have one. Obama is actually doing some things with the community college training, but we need more of this. Finally, it is not just the middle class – we have 46 million people in poverty who don’t seem to be something the GOP (or Dems for that matter) want to talk about. Well done and good comments, I do need to read the book you mentioned.
Thanks, BTG! I’m glad you shared some real world experience with us. And you definitely should. Even if you’re a Republican, it has a lot of good information that one should at least know about before opposing liberal policies.
Thanks S.P. I have read them both. I don’t know what your field of study is, or, if you have picked one yet, but, if we are going to be in the book recommending business I will offer you two that will rock your world. They both will explain to you why people believe and act as they do and that is helpful no matter what you end up doing. Understanding what it means to be human is, or, should be, any students primary major, even if they don’t offer degrees in it.
http://www.amazon.com/The-Corruption-Reality-Religion-Psychopathology/dp/0879759356/ref=pd_cp_b_0
http://www.amazon.com/Wings-Illusion-Origin-Nature-Paranormal/dp/0879756241/ref=pd_bxgy_b_img_y
All the Best
Mrs. N.
I couldn’t agree more, well said. I am beginning my major in Economics and I am most likely going to pursue a double major in Philosophy. I’ll throw some English courses into the mix every now and then as well. I started with engineering courses in my first year and by the end of the year I realized I wasn’t passionate about it… At all…
Thank you very much for your recommendations. I’ll make sure these two books are the next two that I read.
James Carville and Stan Greenberg have written a book, It’s the Middle Class, Stupid! Carville coined the phrase, it’s the economy stupid as a Clinton strategist. Yep, it is about money. Now he is worried about the very fabric of our society. It is the types of things you point out here that has Carville concerned. Really, it should concern all of us.
Very informative and well documented blog. Thank you, SimplePolitiks! Another reminder to vote this coming elections – for restoring the U.S. middle class.
I’m glad you enjoy the blog! Thanks for dropping by
hi
just posted a case in favor of small governments by sighting examples from my own country…thought you might find it interesting…would love to hear your thoughts on it. you can view it here:
http://doakonsult.wordpress.com/2012/09/04/why-i-dont-keep-my-money-with-my-government/
Yes, the “middle class” has been hit by liberal polices, but equally the poorer. The richER have taken a ‘hit’ also, unable to expand business as they desire and thus unable to employ more people. But I do have a problem with the “class” rhetoric… since America doesn’t have ‘classes’ of people. In our society, the rich can quickly become poor and the poor quickly rich! We offer opportunity – not class warfare.
The interesting aspect to me is how the oligarchs have managed to keep the middle class at each other’s throats.
The usual tools…. Religion, immigration and a heaping helping of Terror Management Theory.
Thank you for a very cogent description of the issues facing so many in America today.
Interesting. I read in a book about revolutions, cannot recall the title, nonetheless, I read that successful revolutions tend to come from the middle class. Taking this into account, there may be more to the war on the middle class than meets the eye.