Growing Size and Income of the Upper Middle class

nobody wants to discuss?

is the middle class shrinking?

Not gonna lie, I’m going to vote Trump, and will continue to vote R down the line because the left is so damn deranged; but I really don’t see much that the Republicans have done to make the middle class better off. I’m struggling more now than I ever have, and I don’t have a lot of debt. This is just month to month stuff. The Democrats are fricking insane, but the Republicans need to be doing more. I’ve about had enough of this protect the rich shite that both sides are doing.

From the linked paper:

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It is remarkable how often people talk about the upper middle class and how little we know about this group. This study found that the proportion of the population in the upper middle class went from under 13 percent in 1979 to over 29 percent in 2014. The effect of this growth was magnified by the greater income differences between this group and the rest of the population. Although wealthier people always have a greater share of total income, this report documents a major shift in the distribution of economic resources. In 1979, the bottom three income groups controlled 70 percent of all incomes, and the upper middle class and rich controlled 30 percent. By 2014, this distribution shifted to 37 percent for the bottom three groups and 63 percent for the upper middle class and rich groups. The middle class alone saw its share of income decline from 46 percent in 1979 to 26 percent in 2014.

Any discussion of inequality that is limited to the 1 percent misses a lot of the picture because it ignores the large inequality between the growing upper middle class and the middle and lower middle classes. This difference has a physical dimension in that most metropolitan areas differ greatly by the size and price of the homes in their neighborhoods and communities. We try to limit segregation by race or ethnicity, but segregation by income (which is growing) is accepted as a fact of life.

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This paper is basically saying the inequality argument shouldn't be hyper-focused on the 1% but should include the Upper MC which grew and combined with the 1% saw all of the income growth while the MC and lower did not...the growth wasn't equal. It dovetails with Charles Murray's point(s) in The Bell Curve and Coming Apart.

An upper class income is defined here as $100K for a family of three. That would be equivalent to two people earning $25 an hour 50 weeks a year with a child. The average hourly wage in the US for people between the age of 22 and 45, what most would consider "young families" is $21.16 an hour.

At $100K a family of three with normal tax situations would see what, $20K withheld for state and federal income taxes and payroll taxes (10% IRS, 3% state, 7% payroll taxes) which would mean about $80K a year in disposable income. That is about $6667 a month in take home pay. Conservatively $1200 of that is spent on housing (taxes and insurance included) and another $500 on utilities. Add in the costs of owning 2 vehicles (hard to earn a wage without one) and you looking at another $500 or so a month, conservatively. Health Insurance is another $800 a month and probably another $200 out of pocket for uncovered expenses / deductibles etc. At a minimum they should be saving $600 for retirement and what, maybe $100 for unsuspected expenses (thats less than a months salary a year, many people claim you need a month in reserve). Groceries will run $75 a week...$300 a month. Clothing themselves will run what, $75 a month? Kids shoes ain't cheap. One would suspect since they are upper middle class they probably want to take a week off every year and go on a little vacation, say $1800 a year or $150 a month. They will also need some entertainment other than making babies or watching TV....maybe $100 a month for dinner and a movie twice? They are going to need childcare most likely, that'll cost em another $100 a week. That leaves about $390 a week to meet their needs outside of those listed above. That is pretty damn good, considering. The "Average" family of three, based on age, would see that reduced to $156 a week...less of a barrier to over spending. Of course none of this leaves any money to pay off student loans but maybe this family didn't get caught up in that trap or managed to get some training somehow that allowed them to earn $25 an hour.

The question that I would ask is if this is truly an upper middle class life style? It seems like a pretty basic existence to me. I think it is typical of a LOT of young families, but are young families really "upper middle income"? The upper bound of the paper is $349K a year, most definitely in most people's mind upper middle class or income....but $100K??? I wouldn't want to try to live on it again.

It really should come as no shock that the number of people included in this report and counted as upper middle income as defined in this report, a family of three defined any way you want to slice it, is greater in 2020 than it was in 1979. We are MUCH older as a nation now. We have way more experience on average and are more valuable to our employer or customers than the average worker was in 1979. In 1979 a heaping pile of Americans still worked in manufacturing and had little or now skill. Anyone who isn't below the poverty line today in the US would have been a highly skilled worked in 1979 considering what most of us do now compared to then.

Finally, this little tidbit from the report is interesting:

"This study used 1979 as a starting point because it was the last business cycle peak before income
inequality grew dramatically in the first half of the 1980s."

Wonder what happened in the first half of the 1980's which could have lead to a dramatic growth of income inequality. That is something someone ought to look into....

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No, what happened was we cut taxes and spent money like never before in the early to late 1980's.

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When you go years without performing basic maintenance on your house, you spend more the fix it up. Carter let the military rot for example.

Meh, the numbers they use are nothing to brag about for upper middle class. $100k as a barrier is a low entry point. It simply takes two married nurses or two married managers at whatever industry and you are basically at the $100k gross.

Trust me, I've gone from $10/hr labor work to making over $325k this year (on path for it).

There is a major difference between buying power at $300k vs $100k.

Real money doesn't start until you pass the $300k mark.

Anything around $150k or lower and you can be dead broke pretty easily.

Italians don't demand as much shiat as the average "poor" here in 'merica. They live more austere lives, whereas our folks have no issue spending 150% of their earnings on tattoos, addictions, clothes, car payments, rental furniture, high interest loan payments, etc etc... It's maddening.

Blaming inflation on policy makers when in fact the policies are always reactionary in nature and the inflation dynamics are driven by things for upstream and more important than the letter of the person in charge.

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The US measures "poverty" at a level equal to Italy's median income. Let that sink in. European middle class income would rate as poverty-level in the US.

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When you go outside of the tourist areas in Europe this is no surprise. Rural Italy and especially France are very, very poor by US standards. With none of the economic mobility and opportunity we have here.

If you’re born poor in Europe, you’re dying poor. There’s no escape.