Thursday, April 28, 2011

Are You Middle Class?

If you're reading this, it means you're probably wondering. And if you're wondering, it means you have doubt. And if you have a doubt, you're probably concerned. And you're concerned, you're probably right. No, you are not "middle class". If you earned about $75,000 a year in today's job market and economy (using the cost-of-living index ratio in today's dollars from 40 years ago), you might be considered to be earning a median middle class income - - - over $100,00 to $250,000 would be upper middle class.

If you were earning over $250,000 a year, you'd be too busy shopping at the mall, looking at bargain basement-priced new homes, a new car, or you'd be on vacation in Hawaii. You wouldn't be reading this blog and wondering what social class you belonged to in American society. You'd be living your life, not wasting your time.

(Estimated in round numbers for the sake of this post.)

If you were earning slightly less than $250,000 a year, I image you could live pretty well, and could easily afford the mortgage payments on a nice "middle-class" house and the car payments on a nice $40,000 car. Most of us don't need (nor really want) the "best" of anything, and we could live quite happily with just "nice".

So unless you earned OVER $250,000 a year, why would you even vote for a Republican? Even if you were a millionaire, and wanted to open your own business, there are plenty of ruthless predators out there that would do anything they could to kill your competition. Billionaires would either buy you out or drive you out of business...everyone will be after your money. And do you really want the hassle of driving a Lamborghini every day? They sit too low to the ground, are cramped for space, and there's no speed limit greater that 55 MPH - at least, not where I live anyway.

What would you need a 15 bedroom mansion for? Unless you entertained a lot and had a full-time staff of housekeepers, it would be just one gigantic dust collector. But if you think you have what it takes, possess the ruthless ambition, don't mind putting in the long grueling hours, and are willing to take the necessary risks with your life's savings, then go for it...if that's what you really want to do. Then you might want to vote for a Republican to save you a little extra on your taxes while you're staying up late at night burning the midnight oil as you count your gold coins.

But MOST of us don't strive for such lofty dreams. We just want a good paycheck, so as to buy a nice house, a nice car, and have a little bit left over to take a nice vacation once or twice a year. Maybe raise some kids and put them through a "nice" college too (and it doesn't have to be the "best" university, or the most expensive one, just a "nice" one).

Besides, most of us will never be rich anyway, no matter how hard we try. If it's not inherited, the odds are against hitting a lottery. The American Dream stories like Bill Gates are far and few between, and athletes and rock stars rely as much on good luck as they do talent and hard work. And if they were only paid HALF of what they earned now, they'd still be happy doing what they long as everybody else were making about the same amount of money for the work they do. And if this were so, maybe they'd be "middle class", because most of these people don't get signed to multi-million dollar contracts either.

Most of us are in fact NOT middle class at all, but are lower-middle-class to poor. Obama only wants to tax the top 5% (those earning over $250,000 a year) to balance the budget and preserve programs for the lower-middle-class to poor. But Paul Ryan and the Republicans want the richest 5% to be even richer, at the expense of making the poorest 20%, the working class, and the lower-middle-class even more poor.

The middle class is divided into two sub-groups: The lower middle class that constitutes about 30% of the population, and the working-class, constituting another 30% of the population. In terms of personal income distribution, that would mean a gross annual personal income ranging from about $20,000 to $50,000 a year - and most of those with household incomes ranging between $40,000 and $100,000 a year would identify as "middle class", or having a national "median" annual income of $35,000 per person in gross earned wages.

The Social Security administration quotes the average median NET income after taxes as $26,261.29 a year.

The middle class = working class households earning between $50,000 to $100,000 + the lower middle class households earning between $20,000 and $50,000 = 60% of the U.S. total working population's households.

(* Some sociologists estimate a household's gross income range of roughly $35,000 to $49,000 for the lower middle class, $50,000 to $99,000 for middle-class, and $100,000 to $250,000 for the upper middle class.)

The upper middle class constitutes roughly 15% of the population. Using this figure, one may conclude that the American upper middle class consist of professionals making more than $100,000 who commonly reside in households earning up to $250,000. These figures are considerably above the national median gross wage of $35,000 regarding individual income, $50,000 for the median household, and $40,000 to $100,000 median middle class gross household income.

Those earning below $20,000 a year (the working poor and poor = the under class) make up 20% of the population. The government's definition of poverty is a single person earning below $10,800 a year (try paying rent and eating on that!)

1.5% of the U.S. individuals earn $250,000 and up, but 5% of households have a net worth of $1 million or more.

80% of America is middle class to poor, and 20% is upper middle class (rich) to uber-rich.
  • 20% - lower class and poor - below $20,000 a year (homeless, welfare, unemployed, disability, Social Security, etc)
  • 30% - lower middle class - $20,000 to $35,000 or households $20,000 to $50,000 (janitors, bus drivers, receptionists, etc) 
  • 30% - working class - $35,000 to $50,000 or households $50,000 to $100,000 (factories, service, managers, etc)
  • 15% - upper middle class - over $100,00 to $250,000 (doctors, lawyers, CPAs, congressmen, small business owners, etc)
  • 5% RICH - over $250,000 a year, household worth over $1 million (CEOs, bankers, hedge fund managers, etc)
What About the Upper Middle Class? - "President Obama has proposed raising taxes on the wealthy, but he has said he will not raise them on families making $250,000 or less (that excludes 95% of the entire working population). So families making, say, $150,000 to $250,000 have done considerably better than middle-class or poor families in recent years. But those six-figure families will nonetheless be spared any tax increases."

Rich People Still Don’t Realize They’re Rich - "People who are rich but not the richest — in the $250,000 zone, say — see they have more than lots of poor people, but also much less than a few very visibly rich people. Then they conclude they’re in the middle, so they must be middle class."

Why So Many Rich People Don’t Feel Very Rich - "Why don’t people at the 90th percentile of the income distribution feel particularly rich? Because many Americans who are richer than this cohort are so much richer."

Everyone Is ‘Middle Class,’ Right - "If you’re mostly exposed to people earning about as much as you, you’re likely to think your earnings are average. Misinformation about one’s socio-economic standing can also help explain why low-income voters in the United States support tax cuts for the rich."

Inequality Is Most Extreme in Wealth, Not Income - "Most of the income gains over the last few decades have gone to the very richest Americans. That means the highest-paid Americans have been claiming a larger and larger share of earnings. The top 1 percent of earners receive about a fifth of all American income; on the other hand, the top 1 percent of Americans by net worth hold about a third of American wealth."

Everyone wants to believe they are middle class. But this eagerness has led the definition to be stretched like a bungee cord — used to defend/attack/describe everything. The Drum Major Institute places the range for middle class at individuals making between $25,000 and $100,000 a year. Ah yes, there's a group of people bound to run into each other while house-hunting.Dante Chinni

If you're not earning the government's definition of poverty of at least $10,800, or the average median net income of $26,260, or a medium household income of $50,000, you'd have to carefully manage your money...especially with the high cost of living just for food, rent, heat, and electric. Most people in these income brackets would need Social Security for retirement and Medicare sometime in their life. If you lost your job you might need unemployment benefits and Medicaid too. If you have kids, food stamps and SCHIP might be necessary as well; or if you got hurt, SS disability. These are the things the Republicans want to cut for the majority of us, denying us a chance of surviving with the very minimum.

Because of Republican polices favoring large corporations (such as wage depression and union-busting, etc.) most Americans are no longer in the "middle-class" any more, that's why it now takes two people working to support a true middle class household (i.e. a husband and wife or two room-mates). Remember when dad used to go to work to pay the mortgage while mom stayed home to welcome you home from school with milk and cookies? Those days are over most American families.

And they way things are today, I don't see it getting any better in the future...and it could possibly get much worse. The middle class is shrinking, a few moving up to the upper middle class, while most are moving down to the lower middle class. I'm just glad to be at the END of my working career rather than be a young person just entering the workforce in 2011. I can't imagine how they'll survive with another 40 years of Republican polices.

What most of us want (and are willing to work for) is just a nice job, paying a nice wage, to live in a nice house, and drive a nice car. To be "middle class". That's not too much to ask for. So unless you are REALLY earning middle class wages, or earned OVER $250,000 year (or were the CEO of a large corporation), why would you even vote for a Republican? Unless of course you're like Paul Ryan and the rest of the GOP, and you just wanted to rob from the poor to give to the rich. But those people aren't nice at all, and they don't have any class.

Tell President Obama to eliminate the Bush tax cuts for the wealthy (those making $250,000 a year or more), and tell them and the GOP to stop whining like spoiled and greedy elitists. They don't NEED another house just because their neighbor's is a little bit bigger; and Paris Hilton hasn't been creating any new jobs anyway.

(Below) The Republican's constituents are those earning at least $250,000 a year. If you earn less than that and still vote for a Republican, then you're voting against your own best interests.

 “God loves poor people — he made so many of them.”~ Abraham Lincoln

1 comment:

  1. Thanks for this informative post. I'm glad I took the time to read it.