But maybe the “death of the middle class” conclusion isn’t obvious at all. And perhaps there is more to the Donald Trump phenomenon. Yes, the modern left instinctively sees such studies as further confirmation that inequality is the nation’s premier economic challenge. Much of the media agrees. The rich are gobbling up more and more of the economy’s bounty, leaving less for everyone else. Case closed.
The Pew results are more complex and nuanced than that, however. One reason the middle class — say, three-person households making between $42,000 to $126,000 annually — share is declining is that the upper class is expanding. Back in 1971, 14 percent of households were upper class, and 61 percent were middle class. Today it’s 21 percent upper, 50 percent middle….
Now, none of this is to downplay the particular economic strain on lower-income Americans, especially those without a college degree. There is evidence that real wages for male workers without college degrees have been stagnant or falling for decades. And those are Trump’s biggest supporters. But the billionaire is competitive even among the better educated. When growth goes away or even recedes a bit, bad things happen to the American psyche. Now combine that with fears college is becoming more necessary and more unaffordable in a time of expanding automation. The emergence of Trump or some populist like him seems inevitable.
This is a very interesting Pew study that kind of confirms what I have thought all along. That is that there are still plenty of households who have more than enough discretionary spending to keep the economy going. If there wasn’t then who are the targets for all the extravagance shown by most cable TV shows.
If you are to believe what you see on TV then all of us should be striving or at least dreaming of backyards filled with fire pits, outside dining and living areas and covered with expensive slate. If there is no discretionary spending left then who are all these people? After all a billionaire only needs so many fire pits.
I have to admit that when I was making close to a six figure income I didn’t consider myself well off. Maybe that was because of my continuing penny pinching from my poorer years. I just couldn’t see constantly spending more and more. When I retired in 2000 we bought a 1928 farmhouse that had gone through a couple of badly done rehabs. We spent about 70% of the original purchase price in renovations. Since that time our only expenses have been repairs. We are satisfied with the way things are and don’t have much desire for all the latest “improvement” so many say we must have.
Getting back to the original thoughts here, yes the middle class is definitely shrinking but still, as shown above, it accounts for half of all American families. Only about 20% of us really worry if we can put food on the nightly table but that is 20% too many. Then there is that 1% whose power has grown exponentially and have more money than they could ever spend but still savagely seek more and more. And they are getting it thanks to decreases in taxes beyond sanity…