Biden Wants To Help The "Middle Class" -- Is That You?
No Washington politician can do wrong talking up the merits of baseball, apple pie, or America's patriotic, hard-working and ambiguously-defined middle class.
Former President George W. Bush released what he called a "Blueprint for the Middle Class" in September 2000, and a Google search says the phrase "middle class" appears 432 times on www.barackobama.com. On Friday, Vice President Joe Biden became the latest politician to embrace the term, convening what he called a "Middle Class Task Force" meeting in Philadelphia and launching a Web site called AStrongMiddleClass.gov (it redirects to a White House page).
Suggested occupations include: electricians who install solar panels; plumbers who install solar water heaters; farmers engaged in organic agriculture and some bio-fuel production; and construction workers who build energy-efficient green buildings, wind power farms, solar farms and wave energy farms.
Call it a backlash against the Wall Street collapse: lawyers, accountants, and bankers are out; plumbers and farmers and construction workers are in.
Biden's summit comes a day after the Obama administration released its 2010 budget request, which also frets that the middle class may be shrinking.
The administration's solution? A $630 billion national health insurance program, expanded Pell grants that would become annual entitlement spending like Social Security, more "green" jobs, and more taxes -- both on businesses (a cap and trade program) and individuals (couples earning $250,000 or more, and individuals earning $200,000).
Worries about the middle class vanishing, shrinking, or otherwise dwindling are hardly new, of course. Time magazine ran a lengthy story in 1986 with the provocative title: "Is the Middle Class Shrinking?"
As far back as 1960, the Hartford Courant newspaper was publishing articles such as one with this quotation: "I also plead for the vanishing middle class that cannot afford to be sick."
In reality, it seem as though the middle class has grown considerably since the 1960s. A 2004 analysis at Econlib.org says that in 1967, 21.7 percent of households made less than $15,000. In 2003, only 15.9 percent made less than $15,000 -- a substantial drop. (These figures are in 2003 dollars and adjusted for inflation.)
I ran the numbers for 2007, the most recent data available, using Census Bureau figures. The percentage of households making less than $15,000 is just 13.2 percent in 2007 dollars.
Similarly, only 8.2 percent of households made more than $75,000 in 1967, and a whopping 26.1 percent did in 2003. In 2007 dollars, 32 percent do.
These are rough figures, to be sure, but they suggest that Americans are becoming wealthier and moving upwards, away from poverty. The middle class seems to be consistently growing, not shrinking.
What is shrinking is how politicians define the middle class. Mr. Obama found himself in a tangle during the campaign over the income cutoff for middle class. "Understand that only 6 percent of Americans make more than $97,000 a year," he said during a debate. "So 6 percent is not the middle class. It is the upper class."
His debate opponent, then-senator Hillary Clinton, disagreed, saying that firefighters and school supervisors can make that much.
Later in the campaign, Mr. Obama defined middle class thusly: "If you are making more than $250,000, than you're more than middle class. You're doing better. If you are making less than $250,000, then you are definitely somewhere in the middle class. And if you're making $150,000 or less, than I think most Americans would agree that you're middle class..."
In reality, there's not a simple definition for middle class. A household income of $150,000 or $250,000 doesn't go as far in coastal areas of the nation; it's enough to buy a one- or two-bedroom condo in Manhattan or a mansion in Toledo.
What is clear is that with the exception of government employees, if you're making $50,000 or $250,000, your job prospects have probably dimmed over the last year. A particularly nasty recession doesn't make the same kind of fine distinctions that politicians like to do.