What do we mean by “middle class”?
Update: My apologies. I cited the wrong Census data table when describing my definition of the middle class. A corrected version is below.
Are you middle class?
For decades, praising the middle class has been a staple of American politics. Candidates vow to defend the middle class and accuse their opponents of betraying it. But what, exactly, is the “middle class”?
Since I began writing this column three months ago, readers have asked for an exact definition of the middle class. The question is a legitimate and vital one. With studies showing the American middle class in decline, understanding which policies create, expand and protect the demographic is more important than ever. But definitions vary.
Despite the incessant political lip service paid to the middle class, there is no official American government definition of the group. The middle class has been intensively studied but no political consensus exists over how it was created or how to strengthen it. Liberals credit government programs with helping create a thriving American middle class after World War II. They cite the G.I. bill, home mortgage interest deduction and state university system as examples. Conservatives credit unbridled, American free market capitalism with the feat. I believe it was both.
Within weeks of taking office, the Obama administration’s launched its own effort to help the group. Chaired by Vice President Joe Biden, the “Middle Class Task Force” was launched in January 2009 and includes the secretaries of labor, health and human services, education and commerce.
The closest the task force came to defining the middle class was a January 2010 report “Middle Class in America.” The study never gives an exact income level that is “middle class.” Instead, echoing academic studies on the subject, the document concludes that “middle class families are defined more by their aspirations than their income.”
The report lists typical American middle-class aspirations as “home ownership, a car, college education for their children, health and retirement security, and occasional family vacations.” Obtaining these goals is harder for middle class American families than it has been in decades, the report argues, because the cost of health care, higher education and housing have risen far faster than wages.
In academia, various definitions of the middle class are used. Economists generally use income as the determinant. Using census data, they break the American middle class into quintiles — groups of twenty percent — and declare the middle sixty percent of Americans the middle class. As I said in an earlier column, this is the definition I use. Based on 2010 census data, the middle class would be the sixty percent of Americans with household incomes from $20,001
$28,636 to $100,065 $79,040 a year.
Other researchers, such as sociologists, have tried to define Americans as middle class by how they self-identify. One of the odd – and I think positive – things about Americans is that they over-identify as middle class. The practice embodies an American ideal that the majority of society’s members, not the few, should benefit.
Americans themselves give varying definitions of the middle class. In a 2008 Pew survey, one-third of Americans who earned more than $150,000 a year — 11 percent of Americans overall — identified themselves as middle class. In the same survey, 40 percent of Americans who earned less than $20,000 — 25 percent — considered themselves middle class as well. The median family income in the United States was $49,445 in 2010, a lower number than many Americans think.
After Occupy Wall Street protests began this fall, The Wall Street Journal posted an online calculator that allows Americans to input their annual income and see where they stand on America’s 1 – 99 percent scale. You can try out the calculator here. Your position in America’s class hierarchy may surprise you.
In a series of interviews last week, American academics said the state of the middle class needs vastly more study. They said finding ways to aid the middle class is not possible without clearly understanding what is happening to it.
John Logan, a Brown University sociology professor, called for a large foundation to fund in-depth research on the middle class. He believes such an effort would force academics to develop a more uniform definition of middle class.
Frank Levy, an MIT economist, called for something more modest. He said surveys of Americans that gauge how many households can find affordable health care, education and housing would be more practical. Both efforts would be a step forward.
As I said in my first column, for me and many others the creation and preservation of middle classes is vital. Before becoming a columnist, I worked as a foreign correspondent and investigative reporter for The New York Times and The Christian Science Monitor for seventeen years.
Covering political, religious and ethnic conflict around the world convinced me that the single largest instrument of stability in any society is a middle class. Whatever their nationality, ethnicity or faith, members of the middle class tend to reject extremist leaders, try to make governments more effective, and often cherish the same values, particularly merit, justice and stability.
I plan to visit communities inside the United States and around the world to examine which economic policies help create middle classes to see what lessons from abroad, if any, can be applied to the United States. (So far, I’ve reported in Kentucky, Turkey, China and Wisconsin.) Along the way I hope to determine whether growing middle classes overseas inevitably mean a shrinking middle class in the United States.
In the meantime, I agree with calls for more intensive study of the middle class. A clearer understanding of what is happening to the demographic is desperately needed. The middle class can be defined. And it can be helped.