Blame the not-too-rich

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It is widely understood that the American middle class has fuzzy boundaries. Many relatively poor and relatively rich people identify as middle-class. In an ambitious 2008 survey, the Pew Research Center found that an extraordinary 53 percent of Americans described themselves as middle class. Yet it's also clear that within this diverse, sprawling middle class, there are some households that are better off than others. College-educated households, for example, have largely been spared the scarring effects of unemployment and underwater mortgages. And upper-middle-income households, a group that overlaps fairly closely with the college-educated middle class, have seen fairly healthy improvements in their standard of living in recent years. This is a group that has a great deal, and a great deal to lose.

In recent years, a number of progressive historians and political scientists have been making the case that American political life is dominated by the ultra-rich. The recent obsession with the billionaire Koch brothers is only the most vivid example of this phenomenon. In Winner-Take-All Politics, the political scientists Jacob Hacker and Paul Pierson link the evolution of the U.S. economy from the late 1970s through the present to the rising political influence of the top 1 percent of the income distribution. In their view, key members of this group have actively sought to deregulate the economy, to undermine the power of organized labor, and to advance regressive tax policies. The end result, they argue, has been a policy environment hostile to the interests of the middle class.

Naturally, conservatives will object to Hacker and Pierson's take on the decades-long effort to free the American economy, which we see as crucial to American prosperity. In the absence of deregulation, the declining influence of organized labor, and a tax policy designed to spur work, conservatives generally believe that the country as a whole, including the working and middle classes, would have fared far worse in a more competitive global economy. Indeed, if there is a social group that has been a barrier to good public policy, one can make a strong case that it isn't the ultra-rich but the upper middle class, a group we'll loosely define as households earning between $100,000 and $250,000.

There is no denying that Americans in the top 0.01 percent of the income distribution have more potential for political influence than those earning $150,000. This influence is channeled through campaign donations and also through charitable giving, particularly to nonprofits devoted to shaping the ideological environment. Just as the Koch brothers have donated to various libertarian causes, their opposite numbers at the Ford Foundation, Atlantic Philanthropies, the Soros Foundations, elite research universities, and countless other lesser-known organizations have devoted themselves to providing intellectual support for the expansion of the welfare state. It is very difficult to tease out which side has had the most cumulative influence over time.

What we can say with confidence is that in any given election the top 0.01 percent has less collective political weight than the upper middle class, simply by virtue of the fact that there are more voters in the upper middle class. These voters tend to be more active as volunteers and as small donors than other Americans, and they are heavily concentrated in professions -- media, the upper echelons of the public sector, higher education -- that further magnify their influence. In Red State, Blue State, Rich State, Poor State, Columbia University statistician Andrew Gelman and his colleagues found that Republicans in heavily Republican states tend to win elections with a coalition of middle-class and upper-income voters, while Democrats in heavily Democratic states tend to win elections with a coalition of voters drawn from all income groups. In effect, upper-middle-class voters are always represented in the winning coalitions, regardless of region.

Voters in households earning more than $100,000 constituted 26 percent of the 2008 electorate. By any standard, President Obama performed very well with this bloc in 2008. In the 2010 House elections, in contrast, voters in over-$200,000 households chose Republicans over Democrats by a margin of 64 to 34 percent, while $100,000 to $200,000 households favored Republicans by a more modest 56 to 43 percent margin. The president's political advisers are keenly aware of the fact that Democrats need to improve their performance with these voters or face defeat in 2012. This helps explain the profound irrationality of the Obama administration's approach to key public-policy questions.

One of the most fascinating aspects of the Obama era has been the elevation of a $250,000 annual household income to an almost mythical status. The magic number was first introduced by Hillary Clinton in 2008, when she defined $250,000 as the upper bound of the middle class. That same year, Barack Obama pledged to cut taxes on all households earning less and to raise them, ever so slightly, on those earning more. Given that 49 out of 50 households earned less than $250,000 that year, there is no question that the cutoff number chosen was politically shrewd. As the Democratic nominee promised a panoply of new social programs, ranging from a health-care entitlement to an expensive effort to foster a green economy, he also made it clear that only one out of 50 households would pay for all that new spending and for reducing the deficits that had widened during the Bush years.