The numbers being used here feel pretty contrived to me, like the article has decided its conclusion and is going to find things to support it. Especially given the pseudo-title in the URL ("americas-middle-class-is-shrinking-yet-thriving-in-many-other-european-countries") which is certainly not borne out by the final graph which depicts the proportion of middle-income adults falling in the US, but by less than Luxembourg, Finland, Germany or Spain.
In general it looks like the US has a wider-spread income distribution, but over time there's a trend to most of these countries spreading wider as well, which drives the reducing size of the middle income bracket. The exceptions to that reducing size look pretty heavily correlated with increased average income (Denmark, the Netherlands, France, Ireland and the UK).
That suggests to me that the original question ("What’s going on with America’s middle class?") is poorly framed to begin with; this doesn't back up the assertion that there is anything especially unusual going on with America's middle class, it appears to be more or less the same thing happening in many other countries.
I wanted to agree with this article but when I read it, I found myself thinking things like, "wait.. more Americans are lower class, but the threshold for Americans to be middle class is way higher than for other countries...". I'm pretty sure that "middle class" is one of those political marketing terms that don't mean anything anyway. I mean, the division into 3 instead of 2 or 4 is totally arbitrary. The reason politicians pick 3 is because a) it's a nice round number that has an air of truthiness and b) everybody thinks they're middle class, so then the politician can go on about how their policies are good for the middle class. I think a better way to divide class is into 2 classes: owners and workers. Then you're really addressing the fact that there are two sources that money flows from: property and labor. The selling of the concept of the "middle class" is one of the great marketing ploys of history.
Note that the article uses "middle class" and "middle income" interchangeably, but in some countries class is not directly related to income. So when it says "that the middle class rose in the Netherlands and Spain, and soared in Ireland and the U.K.", at least for the UK they mean "middle income" not necessarily "middle class".
Indeed it's not clear America has ever had much of a middle class. As PG says, 20th Century America had a large working class population who enjoyed middle incomes, fuelled by America's huge industrial expansion. That expansion is now over.
In my opinion, what's happened has been quite toxic. People have been given the illusion of social progress whilst true opportunity has been concentrated in a very small population. Those that want their country back have missed the point: it was never theirs in the first place.
The scholar in me admits that you have a point, but the practicist in me says, who cares? Let's use this narrative to get the basic social guarantees that all those poor and middle class people have in Europe-- education, health care, retirement, etc.
What this article refers to as "middle class" in Britain would probably be referred to as "working class".
To confusing things further, in Britain referring to something or someone as a bit "middle class" would mean it was somewhat posh.
Eg Rich lawyer or doctor? Middle class.
CEO of a FTSE 100? Middle class.
...and if you really want to go down the rabbit hole, when we say "public school" we mean a very middle class group of private schools, such as Eton or Harrow.
The UK's class system is impossible to summarise precisely, but I think most people would consider Eton and Harrow as upper class. It's where future world leaders, powerful civil servants, royals and aristocrats, significant politicians, and captains of industry go to be educated. (And, not incidentally, to be told how special they are.)
Middle class is more the common professionals - managers, small business owners, doctors, lawyers, accountants, engineers, architects, academics, creatives. The marker used to be a degree or some success running a business, but the degree part has been devalued now.
Working class is everyone else. Even if they work in an office.
Put even more crudely the upper class creams off the money, the middle class keeps the money machine running, and the working class does the grunt work.
Income doesn't correlate neatly with these groups. It's possible - not even as an outlier - to be middle class and working in the arts with very little money, or be working class and earning six figures.
"Based on your household income and the number of people in your household, you are in the middle income tier, along with 50% of adults in Raleigh. "
Following the article, however, you would be classified as 'high income'.
"...In inflation-adjusted dollars, the share of U.S. households making $100,000 or more has more than tripled between 1967 and 2017, from 8% to 26%, according to U.S. Census data, while the percentage of middle income ($35,000 to $100,000 a year) has fallen. "
> a maddening lack of a definition for "disposable income".
Not really. The article goes into pretty good depth about its logic comparing them in pre-tax income (gross income) and after-tax (what it is calling "disposable income") across various countries.
Thus, when gross income is used to define income tiers, the result is that higher shares of adults are estimated to be lower income or upper income, and smaller shares of adults are estimated to be middle income.
Not surprising as 80% of the income is being funneled to 20% of the population. To resolve it reinstate the internal revenue act of 1954. indexed to inflation, top marginal tax rate for income over 5mil a year should be 91%, top corporate tax rate should be 51%.
The US is much bigger and more diverse economically than the countries it is being compared to. Odd results should be expected. If you looked at individual US States it would look much more like the rest of the cohort.
The article does touch on a large part of the explanation.
Ross Perot, running as a 3rd party Presidential candidate in 1992, called it the "giant sucking sound" of US jobs going to Mexico due of NAFTA.[1]
Not long afterward, US trade with China drastically increased.[2] Then China was admitted into the WTO. And the rest, as they say, is history.
The manufacturing jobs lost during this period of time were, for the most part, middle class. With the loss of manufacturing, we've seen growth in minimum wage service jobs and growth in highly paid knowledge jobs (e.g. HN type people).
What you describe above would imply that everyone is falling out of the middle class rather than climbing up out of it - the data doesn't back that up though. FTA:
"In inflation-adjusted dollars, the share of U.S. households making $100,000 or more has more than tripled between 1967 and 2017, from 8% to 26%, according to U.S. Census data, while the percentage of middle income ($35,000 to $100,000 a year) has fallen. However, lower income U.S. households ($35,000 or less per year) have only slightly fallen over the last four decades."
What is shows is the bottom three quintiles have been stagnant in terms of income. Most of the growth has occurred in the top quintile and especially in the top 5%.
America has a much higher proportion of blacks, illegal immigrants and prisoners than the other countries. US blacks in particular are about 12% of the population and have a median household income about at the lower income boundary [1], which could explain the large lower income group. America is also obviously economically quite productive, perhaps explaining the large upper income group.
If you make a correlation like this one, without explaining any potential causative steps, then everyone will rightly or wrongly assume racism.
It's not your fault, but such writing which amounts to pairing black people with something bad, without explanation, is a 'dog whistle' for racists---silently letting them acknowledge each other without being overt.
No, it's not enough to say "but black people are poor, thus dragging us all down". One is supposed to not acknowledge race unless it is pertinent, so to many your example is akin to a tautology of "poor people are poor, America has more of them", after the mental erasure of the racially irrelevant text.
It's difficult, yes. I was just looking for explanations and that's what I came up with. Even if I'm wrong, I think it's harmful to understanding to filter out ideas just because they might sound racist. A kind of self-censorship.
It's not as simple as poor people are poor. Making it more specific: Black people are poor in both the US and the UK [1]. The US has more black people than the UK. So, ignoring everything else, the US has more poor people than the UK.
PS. To those who think it's racist to say black people are poor, I'd say they're being elitist by assuming that being poor is bad or being labeled poor is derogatory.
ccording to Census figures in 2013, 18.9 million whites are poor. That’s 8 million more poor white people than poor black people, and more than 5 million more than those who identify as Latino. A majority of those benefiting from programs like food stamps and Medicaid are white, too.
In general it looks like the US has a wider-spread income distribution, but over time there's a trend to most of these countries spreading wider as well, which drives the reducing size of the middle income bracket. The exceptions to that reducing size look pretty heavily correlated with increased average income (Denmark, the Netherlands, France, Ireland and the UK).
That suggests to me that the original question ("What’s going on with America’s middle class?") is poorly framed to begin with; this doesn't back up the assertion that there is anything especially unusual going on with America's middle class, it appears to be more or less the same thing happening in many other countries.