your response proves my point unless you can show me that the trend going forward is a “thinning of the middle class”. don’t tell me what happened over the last 20 years, tell me what will happen in the next 20. are the trends truly showing that the middle class is thinning? the answer is no. the middle class is expanding now and many things are in place so that the middle class should expand over the next few years.
also, this is what i said, “$2,300 is enough to feed a family for a year on a budget”. on a budget meaning the very least. and the $2,300 figure is the average of all that receive EITC, including households with no kids. yes, $2,300 is a stretch for the vast majority of families, but we’re talking about the low of the low here. if you can sustain by spending $3 at Checkers every day, i think you can spend less than that eating pancakes every day, like some poor households are forced to do. btw, the EITC goes as high as $6,300 for families with 3+ kids so $6,300 in that household would certainly keep them fed and then some and by then some i mean buying lots of iPhone cases on Amazon.
the EITC definitely has made it easier to be poor and certainly boosts their discretionary income relative to 10, 20 or 30 years ago.
there is a reason why a fairly philanthropic minded person like Buffett wants to use the EITC as the SOLE solution to fight poverty.
I’m looking for reasons not to be depressed about the future. Can you help me with some data here that supports your point that the middle class is expanding. It would really help with maintaining the Holiday Spirit…
Maybe he’s not talking about the U.S.?
That’s true. The global middle class is expanding. I agree there.
But I got the sense that MLA was talking about the US and maybe Canada too.
over time, the number of households with “middle incomes” has fallen but the number of households with “upper incomes” has more than offset, while the number of “lower income” households has been falling or flat depending on your frame of reference. people talk about the “shrinking middle class” without mentioning the “exploding upper class”. the fact that most of us without family money but simply decent jobs are now welcomed to the upper income echelon is clearly a good thing.
if you consider the much higher quality of life due to much better welfare, EITC, food stamp benefits that lower income households have now compared to 10, 20, 30 years ago, you’d probably include 1/3 to 1/2 of the lower income households in “middle income” as well. a lower income household with 3 kids now gets $6,000 on top of food stamps, low income housing and all of the other goodies compared to a couple of decades ago.
it is obviously better to be in Canada or Europe while poor but the U.S. does look after its own, particularly its working poor and retired poor, to the extent that they are not in absolute poverty like similar households would’ve been in the 70s, 80s or 90s.
http://www.nytimes.com/interactive/2015/01/25/upshot/shrinking-middle-class.html?_r=0
If the upper class is exploding enough to offset the shrinking middle class, how is it that median income is trending down since 1997? The FRED data does show an up bump for one year between 2012 and 2013, but I’m not convinced that this means it’s all turned around now.
https://research.stlouisfed.org/fred2/series/MEHOINUSA672N
Certainly the opportunities for the middle class labor force don’t appear to be expanding markedly, and the process of replacing professionalized workforce with computers doesn’t seem to be stopping any time soon.
^ i’m too lazy to find evidence to answer that question but my best guess would be that the lower income spectrum, pre-government benefits, has household income that is much lower than 20-30 years ago as U6 unemployment is way up (particularly for low income folks) and minimum wages in most regions is way down on a real basis.
additional government support has boosted the total income pie such that more Americans are out-of-poverty in an environment of flat wages and more high income earners.
from the charts on the webpage i posted, you can see that most of the gains are for older americans clearly as a result of SS and Medicare. how we deal with the sustainability of SS and Medicare will have a major impact on poverty levels going forward.
Wow, someone is really drinking the “upper class Koolaid”. 
Skeptical. The trend seems clear – real jobs are replaced by robotics and sent overseas, yet population does not decline, so fake jobs are created for the unnecessary headcount, thus most people make less money (because these fake jobs don’t actually do much of anything).
^ that, or the professional class is now actually 3x as large as it was.
Here is an article with a theory that Amazon is entering the delivery business:
http://www.businessinsider.com/amazon-may-be-testing-secretive-air-cargo-service-2015-11
Well, it is true that those of us in the “upper middle” get the trickle-down from the 1%ers, and everyone else gets nothing. But I want to see some hard data from a real source. I would think upper-middle might be making more, while middle and lower (most people) get screwed hard(er). But hard to believe that upper-middle is growing in count significantly and taking over the pie chart. Most people are NOT professionals under any defintion of the word.
You make a comment like this and demand hard data from others?
composition of the top 10%. and the steady incline of income share.
http://piketty.pse.ens.fr/files/capital21c/en/pdf/F8.6.pdf
the top 60% has basically done as well as the top 20% in terms of income.
http://www.advisorperspectives.com/dshort/updates/Household-Income-Distribution.php
so combine the fact that the 40th to 80th percentile has done as well as the 80th+ percentile with the fact that many in the 40th to 80th can now acheive the 80th to 95th with relative ease, things are at least as good as they’ve been relatively, and are much better than the 80s and before. these number also exclude benefits so the slight drops in income from peak are likely overridden by additonal welfare support, especially for seniors.
my point isn’t that things are advancing rapidly for the bulk of society. it’s that things are getting better for working individuals in aggregate over time, albeit at a snail’s pace as a result of the terrible economy.
Right, that’s exactly what I said: the top 5% are getting everything and then some, the top 20% (upper middle class) get some trickle-down, and everyone else gets f@#$%d. No need for games with stats, we all should know this is the situation in the USA. It’s been going on for many decades, it’s called income inequality.
^ yes, i attached the same chart but with different conclusions. almost everyone is better off, either outright, or due to increased government support since earlier periods, except maybe outside of economic/market peaks like in 2000 or 2007, which makes sense. if you’re doing better, you’re not getting f@#$%d. i’m 100% for reducing income inequality further but i wouldn’t say that the average person, or even the average poor person, is worse off. they just haven’t participated in the market’s/economy’s upside the same way as the top 10%, or 1% in paricular. the reason incomes became a discussion in this thread is because a poster was suggesting things were getting materially WORSE for the vast majority of the population, which is false. plus, there are many things working in favour of the bottom 50% going forward, minimum wage hikes in particular, which are proven to reduce income inequality. whether they are efficient or not is another question.
The top 5% are getting everything? Do you not see that the top 20% has a very similar percentage gain over the same time period? How is a similar percentage gain equal to just “some trickle-down”? And how is maintaining the same level of income in the lower quintiles “getting screwed”? Is the bottom quintile contributing much at all to the technology developments that have driven average income growth? Clearly not, so why would they be entitled to the profits? Are you considering those technology improvements? An HDTV can be had today for much less than a crappy TV a couple decades ago. All of these bottom quintile people also have smartphones, better cars, etc… These things cost the same as they did a few decades ago in inflation adjusted dollars (if they existed at all), so the bottom quintile, though making the same income, actually has a much higher quality of life (at least in terms of material goods).
I’d be pissed if we had income equality. Income equality = injustice.
this place is nuts
The 1% are getting everything. The top 5% are getting significantly more than the top 20%, etc.
Because prices rise faster than incomes, and new things become needed, and they get screwed. Squeeze the middle, I thought everyone knew this was the game? The corporations make the profits, and distribute it to the 5%.
Haha, okay. I think this is called denial.