Is the Middle Class (a) stagnating, (b) falling behind, or (c) getting wealthier?

Question

Please see this link http://www.optimist123.com/optimist/2007/11/brain-teaser-of.html

Definitions:
Median - half way point. In this case, half of American households make more, and half less.

Real Income - After inflation has been factored, so actual progress can be measured after things like declining dollar value and increased prices on things like oil, housing, food, etc. are factored in. In this case, all figures are converted into 2006 dollars.

Yes, there are declines under Bush, no question. It's expected given the hand he was dealt of the dot.com bubble bursting and 9/11.

What I want you to see here is the long term trend. Over the last 20 years (1 generation), the median household is 10% richer.

This idea that the middle class is being screwed is just wrong. As a whole, we are doing much better as a nation.

Raw Data Source - http://www.census.gov/hhes/www/income/histinc/h06ar.html

CeasarLi - What difference does it make if the rich got richer? I'm in favor of everyone getting richer. Aren't you?

Answer 1

The correct answer is C ... sort of. While most of the middle class is getting wealthier, the few who aren't are becoming the new lower class.

Answer 2

The middle class is falling behind.

Though they are making more money, the inflation rate is far exceeding the pay rate.

10 years ago, you could find a house in one of the poverty states (LA, MS, AR, etc) for $15,000.00 those same house are approaching the 100k mark, and pay has not increased significantly, if at all (depending on the state).

Based on what you want us to believe, that the middle class is doing as well or better, then the middle class should also have near the same % of homeownership during this time frame. However, the rate of homeowners for middle class has dropped.

The federal govt has recognized that the middle class of the US is under poverty level.

As for "the hand bush was dealt" the dot com bust happened in the mid 90's and 9/11 was self inflicted, the US knew it was going to happen and did nothing to stop it, and aided those that were blamed for it (I was in the military and stationed in DC during 9/11)

Answer 3

b). The chart shows that the real median household income was higher in 2000 than it is now. The dramatic increase in real median income in the 1990s also accustomed individuals to household financial growth and not to the condition that they have been experiencing for the last few years.

Also, many employers are dropping benefits or requiring workers to pay larger shares of benefit costs. The income calculations don't take those changes into account, so the median household financial situation is even somewhat worse than presented.

In addition, as the financial situation worsened, people incurred debt in order to pay bills. The debts have to be paid including credit card debt and home equity loans and their houses are worth less.

Answer 4

Stagnating at best and probably falling behind. Your "facts" are way off-the "dot com" bubble had little or no effect on anything other than the Stock Market. 9/11 was at worst a temporary blip on economic progress.
And10% over 20 years? Big deal and most of that accrued during Clinton's administration. And 1/2 % per year is hardly big time progress, particularly when you factor in the rise in energy and health care costs. You are way, way off the mark in your conclusions.

Answer 5

And how have the richest 5% faired over the past 20 years?

Edit: When the elite are quadrupling their wealth, they have no business telling 99% of their fellow countrymen to be grateful for their scraps.
Millions of American families are losing their homes because the Federal Reserve doubled their mortgage payments in 2005-2006. Why has the Fed sabotaged the housing market? To prevent any possibility of an increase in inflation eroding the wealth of the elite. In the mean time, George Bush is pushing China to depeg their currency from the dollar, which will cause inflation of goods mostly purchased by lower and middle income families.

Answer 6

Look at what Jimmy Carter did to inflation and the middle class. We really had to struggle when the interest rates on
housing topped out at 18%. We had just gotten married and everything was much more expensive back in 1982, but I seriously doubt you were around back then or perhaps you were a small child. So no, it isn't jush President Bush. I would say it is because we are still at war with another stupid third-world country that is trying to impose their values on us.

We've always been middle class and we have way more
money than we did ten years ago. But it depends on how
a person invests or saves their money instead of spending like there is going to be no tomorrow and if people are truly capable of making wise investments. The stock market is unstable right now... so anything can happen, if you choose to look at things from a negative viewpoint. I see our glasses as being a whole lot closer to being full than half-empty. It is really
a matter of perception and how mature you are about making important decisions in your life. I personally agree with that person called "Dinamuk." And we intend to become even more wealthy, so I think that is being called an optimist against all of the odds that "might" happen to be out there against you. We are now retired with a seven income figure, if that helps make my case. So yeah, we are happy, plus we also donate a portion of our money to the hungry, the less fortunate, I pick up a child from school who's mother is working when she gets out of school and we generously donate to all kinds of charities. No bias here for those that aren't as well off as we happen to be. We try to help generously in many catagories, and our son has a college education fund set up for him when he graduates high school. But we aren't giving all of our hard-earned money away, if that
is what you want to know. We are now upper class and I see many other people heading that way too. Just because you are looking at a census doesn't mean it is 100% true.

Answer 7

I agree that the middle class is becoming wealthier, and I don't even have to look at the data! Think about how much more the middle class has today - the electronics, the cars, the upgrades! It is so hard to "keep up with the Joneses." When I was a kid, we were middle class, but what we had back then now seems poor. I believe we are on a trend toward two classes: rich and poor. That is how all other economics systems end up, why not capitalism, too?

Answer 8

If you read the link you provided it is proof of nothing. your own source( try reading thier debate) cant decide if the middle class is better or worse. They do agree that you can read it either way. I am middle class and I know what I see. My friends are middle class and I see it there. Tell me how everything is all rosey for me. Maybe you have another link?

Answer 9

Stagnating, falling behind, or getting wealthier? Your question is really one of perception. For most people if they are doing good then the economy is good. As soon as they are layed off or go bankrupt. Those same people will say the economy is bad.

Answer 10

can you please explain this to my bank account because it is really having a hard time understanding this - especially when the fed doesnt include oil and food and commodity prices in its inflationary reports or the devaluation of the dollar and the certain rise of interest rates after christmas and the new year