Rant: America's No. 1 Endangered Species
Is the middle class losing its "place at the table"?
Who speaks for the middle class, that endangered species of American vanishing more rapidly than Joe Biden's presidential aspirations? Who cares about the forgotten 90 percent of citizens who classify themselves as neither upper nor lower class?
Oh, that's right: everyone, especially if he's a millionaire politician or pundit. Which should be proof enough that the middle class is actually doing pretty well. After all, pols and pundits go where the votes and the viewers are.
There's Lou Dobbs, the CNN host, self-described "lifelong Republican," and War on the Middle Class author. He ponders daily why it takes so many families two incomes "just to get by."
There's Sen. James Webb (D-Va.), who in his response to President Bush's State of the Union address asserted that "the middle class of this country, our historic backbone and our best hope for a strong society in the future, is losing its place at the table."
And there's George W. himself, who frets over "income inequality [that] has been rising for over 25 years" and recently issued a rebuke to the fat cats who sit on corporate boards: "You need to pay attention to the executive compensation packages that you approve."
This trio-and a cast of thousands ranging from conservative Pat Buchanan to liberal Paul Krugman to Fed chairman Ben Bernanke to View co-host Rosie O'Donnell-point to indicators such as the growing share of national income held by the top 0.1 percent of households to sell a narrative every bit as clichéd and unbelievable as, well, a State of the Union address that promises more government for less money: Regular, decent folks can no longer afford the American Dream because plutocrats are scarfing up all the lobster and filet mignon at the all-you-can-eat buffet that was the U.S. of A. We haven't just lost our place at the table; we've been sent to the kitchen to wash the dishes.
The rich are indeed getting richer (the bastards). As The Wilson Quarterly's Steven Lagerfeld points out, those 130,000 households at the very top of the earnings pyramid have increased their share of pretax wage and salary income from 2 percent in 1973 to just under 7 percent in 2004. Folks in the top 5 percent of households-those making more than $166,000-have seen their inflation-adjusted annual income rise by a hefty two-thirds since 1970.
But everyone is getting richer, albeit not that rich. In real dollars, every quintile has posted significant annual increases during the last 35 years, ranging from $3,000 for the lowest quintile to $13,000 for the middle quintile to more than $25,000 for the next-to-highest one. And the individuals in those quintiles change all the time, something even The New York Times, which wrings its hands on class matters like an obsessive-compulsive, admits. Urban Institute economists Daniel P. McMurrer and Isabel V. Sawhill estimate that between 25 percent and 40 percent of individuals switch quintiles in a given year and that "rates of mobility have not changed over time." Other research tracking individuals in the lowest income quintile in 1968 found that 23 years later, 53 percent were in a higher quintile and half had spent at least a year in the top income quintile.
More important, basic indicators of wealth and opportunity drive home the reality that the middle class's place at the table is pretty secure-maybe not the best seat in the house, but arguably better than ever. A historically high 70 percent of Americans own their homes. Two-thirds of high school graduates go on to college, up from half in 1970. That wouldn't be happening if the U.S. were fast turning into the Brazil of the North.
But don't expect the "vanishing middle class" storyline to vanish. Pols and pundits will use scare stories to drum up business and push minimum wage hikes, tax breaks to pay for the wage hikes, prescription drug coverage, and so on. We in the middle class like the attention (and the more-than-occasional entitlement). More to the point, there are more of us, and we've all got more to lose than we used to. Which means we've got even more to worry about.
Nick Gillespie is editor-in-chief of Reason.