Friday, April 18, 2008

a corollary to the class conversation-- who is not "middle class?"

In a city where everybody makes a lot of money, prices rise so high that the moderately rich live like middle-class people. Just because the United States has a dozen of these communities doesn't mean that $200k is middle class.

Also, if you make enough money that the interest/capital gains on your money is enough for you to live on, you're rich. Never in the history of the world have people made enough money that they could stop working (without government help, anyway) and not been called "rich." Just because you're bad with your money and blow it all trying to have the most expensive stuff doesn't make you middle class.

Put another way, it's stupid to define rich as "having more money than you could possibly spend." As we've seen with powerball winners, people can spend a shitload of cash if they're undisciplined with their finances.

Obviously, it's extremely difficult to develop objective criteria for the boundaries marking off middle class (or, perhaps, the middle classes) from rich and poor. Poor is obvious: if there is a legitimate concern that you may not be able to afford food until the next paycheck, you are poor. Rich is somewhat more difficult, mainly because it's somewhat of a taboo in this country to admit that you're rich, but there's one solid criterion: if work has never been a necessity for you, you're rich.

The problem with our discourse hinges mainly on the fact that there is a group of people who do work or have worked but should by most standards be considered rich. Because of said taboos, however, we allow them to call themselves "upper middle class" (and even "middle class" in some cases) and they skew perceptions of economic class because they don't really belong in the same group with everybody else.

The median household income in this country is $48,201. If your household brings in $60k, you're in the 60th percentile of income earners (as in, 59% of the country makes less than you). If you would consider a 60k/year home to be "poor," you're probably rich. Yes, even if you live in New York, and even if you still have to work, and even if you're living paycheck to paycheck because you're still paying off the million dollar house and the Land Rover and your kid's private school and the credit cards.


Rene said...

i think that this is an interesting topic to discuss, though I don't exactly know what spurred it out of you there.

I think it's generally accepted that one's perceptions of wealth and poverty tend to run relative to one's expectations. For example, if I make 15k/yr then by your definition I should be considered "poor", but if lived in certain parts of Sudan and brought in that kind of money then I'd be some kind of land barron. Ironically, raw capital doesn't have as much buying power in the poorest parts of Sudan as it would in areas with more stable economies.

I think that wealth and poverty should be measured in relative scales:

--buying power of a given unit of currency at a given location.

and separately,

--units of currency required to feed and shelter one's family for a given period of time.

By these metrics one US dollar is worth considerably more in Lubbock Texas than it is in London, England. It's worth at least a measurable amount more in Lubbock Texas than it is in San Fransisco, California.

Additionally, you need fewer US dollars to eat and have shelter in a country like Switzerland with a strong welfare system in place than you would in Afghanistan where (I'm assuming here) there is none.

Therefore you need more than just a measure of currency and the guts to draw a line in order to measure the middle class. You need:

-a measure of currency
-a location
-a measure of the currency's buying power in that location
-a measure of the amount of buying power needed to sustain one's self in that location

Of course all of those metrics will vary (sometimes wildly) as you try to measure areas as large as the United States - and that's just for setting the "poor" line up.

Discussing what "rich" is becomes even more difficult when you take that into account.

FWIW, I think the amount of credit immediately available to an individual can start to form the baseline for a good "richness" scale.

el ranchero said...

It just came from all the articles on social class from various corners in response to Obama's "bitter" remarks, as well as Gibson's implying that Obama's an elitist right before he went on a tirade in favor of lowering the capital gains tax. Hearing wealthy, famous members of the elite media try to burnish their street cred is causing me more and more distress all the time as I become more sensitive to it.

Your points are good, and well-taken, but in a way they still leave us at the same problem: where to demarcate "wealthy" or "rich" from "middle class." Finding the proper dividing line between those who make enough to feed and shelter themselves and those who don't is one thing (and the point that any theoretical "poverty line" should be location-sensitive is absolutely true); finding any workable line at the top of the societal pyramid is another because it involves defining criteria that labels some people as "not middle class," which implies "does not have middle class values" and "is not qualified to speak for the middle class."

My only point is that both our political establishment and the traditional media elite are incapable of having a coherent conversation about this because many of them would fall above that line or have serious and feasible aspirations of crossing over it, and thus will do everything they can to gerrymander any attempt to draw that border so that they themselves fall among the masses. Their credibility as everyman journalists and statesmen depend on it, as do their very identities (as in, I think they really do believe that they are middle class, even if they own yachts and second homes in Martha's Vineyard).

It's not really that I believe I could draw a workable, reasonable line demarcating rich from middle class; it's just that I know the people who moderate and channel our national conversation can't, and can be relied continuously to push that line ever upward so they and their friends aren't included among the ranks of the rich.