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More Americans are breaking into the upper middle class

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Re: More Americans are breaking into the upper middle class

#81

Post by Ajedi32 »

pixl97 wrote: post #76
Ajedi32 wrote: post #68

Earlier quoted context omitted.

Yes, if you cherry pick a few things that are disproportionately going up in price and say inflation should be calculated based solely on those things then you can make the numbers look worse. Or the reverse if you cherry pick things that are going down in price. I don't think either of those would be a more reasonable approach than looking at CPI.

I mean if those things are housing, medical care, and education that's not really cherry picking at all.

Yes it is. CPI already takes those things into account. If you ignore all other living costs in favor of just looking at those three things because they're the things that are going up the most then you're not getting an accurate measurement of purchasing power.

Re: More Americans are breaking into the upper middle class

#82

Post by HWR_14 »

laidoffamazon wrote: post #74
HWR_14 wrote: post #63

Earlier quoted context omitted.

A lot of people consider themselves middle class and are wrong in that self assessment. It goes both ways, you have people making a half a million a year and people making twenty thousand who both consider themselves middle class.

I went to a state school, worked at Amazon and didn’t get a 2300 on my SAT - I definitively am lower caste but the caste/class divergence isn’t well understood in culture I think.

You're the one bringing up caste. Middle class is determined by income and it's not subjective.

Re: More Americans are breaking into the upper middle class

#83

Post by ksymph »

bryanlarsen wrote: post #80
ksymph wrote: post #42

Earlier quoted context omitted.

The poverty line, as established in the 60s, is simply 3x the minimum food budget. Food as a percentage of spending has decreased, while housing and other expenses have dramatically increased. If the poverty line were to be adjusted to reflect the share that food takes up of income today, from ~30% in 1963 to ~6% today, the threshold for a family of four would go from ~30k a year to ~150k. More in-depth explanation h…

That article is BS, the author even acknowledges that in a later post. The main reason the share went from 30% to 6% is because people are richer. Poor people spend more money on food than rich people.

It's true that lower income families spend a higher proportion of money on food [0], but that was equally true in 1963. It's a static fact about income brackets at any time, and doesn't explain the change in average share.

Food share dropped from ~30% to ~6% because real incomes have risen and food has become cheaper relative to housing, healthcare, education, and so on. That shift affects all income levels, including the poor. Your point doesn't contradict the article's, that the poverty line, based on 1960s food budgets, no longer reflect current costs of living.

Could you send the article where the author revises their claim?

[0] https://en.wikipedia.org/wiki/Engel%27s_law

Re: More Americans are breaking into the upper middle class

#85

Post by closeparen »

RajT88 wrote: post #30
closeparen wrote: post #18

Earlier quoted context omitted.

Doesn't look like it. What's your source? https://www.statista.com/statistics/200463/us-poverty-rate-s...

Poverty line is different from living paycheck-to-paycheck. The growth is not dramatic, but steady over time: https://institute.bankofamerica.com/content/dam/economic-ins...

>We consider a measure of necessity spending that includes but is not limited to childcare, external credit card payments, gasoline, general retail, grocery, housing (mortgage/rent), insurance, cable TV/broadband, public transportation, tax payments, vehicle costs and payments. We consider spending across payment channels (ACH, credit and debit card, bill pay). Income is defined as regularly recurring payments into accounts, such as payroll, social security, unemployment insurance pensions, and annuity income. Households are defined as living paycheck to paycheck if in the quarter their necessity spending exceeds 95% of their income

This is more thoughtful than some "paycheck to paycheck" discourse, put objectively well-off people definitely put themselves into this picture by signing up for more house, more car, or more credit card spending than even the relatively high level they can afford.

Re: More Americans are breaking into the upper middle class

#86

Post by balderdash »

pc86 wrote: post #64
balderdash wrote: post #29

the thing that doesn't compute for me is that the definition of upper middle class here is 5-15x the federal poverty line, ok, but in 1970 the federal poverty line was like ~$3k (and ~$22k today) 10x in 1970 (~33k/year) in nyc you could buy a 2,000 sqft apt for like 2.75x your salary [1] today, that same apartment is like >10x - so while perhaps more people are earning "upper middle class" incomes, what that gets you…

Aren't these two different things? Should "upper-middle class income" refer to your income regardless of COL, or should it refer to an arbitrary measure of what you can buy with it?

At least in my mind - if we were talking about statistical segmentation of income I think that’s right - but “middle class” and “upper middle class” denote a level of economic security, social status, lifestyle, disposable income whatever that I do think correlates with cost of living.

Re: More Americans are breaking into the upper middle class

#87

Post by bryanlarsen »

ksymph wrote: post #83
bryanlarsen wrote: post #80

Earlier quoted context omitted.

That article is BS, the author even acknowledges that in a later post. The main reason the share went from 30% to 6% is because people are richer. Poor people spend more money on food than rich people.

It's true that lower income families spend a higher proportion of money on food [0], but that was equally true in 1963. It's a static fact about income brackets at any time, and doesn't explain the change in average share. Food share dropped from ~30% to ~6% because real incomes have risen and food has become cheaper relative to housing, healthcare, education, and so on. That shift affects all income levels, includin…

In the 1950's poor people in America may have had housing, but there's a good chance that housing didn't have plumbing. Poor people in the 50's spent roughly 0% of their income on childcare. Much of the article is complaining about the cost of child care.

You may think that poor people should be able to afford child care. That's a valid thought. But then you can't compare that to a 1950's definition of poverty where child care is definitely not affordable by the poor.

Re: More Americans are breaking into the upper middle class

#88

Post by ksymph »

bryanlarsen wrote: post #87
ksymph wrote: post #83

Earlier quoted context omitted.

It's true that lower income families spend a higher proportion of money on food [0], but that was equally true in 1963. It's a static fact about income brackets at any time, and doesn't explain the change in average share. Food share dropped from ~30% to ~6% because real incomes have risen and food has become cheaper relative to housing, healthcare, education, and so on. That shift affects all income levels, includin…

In the 1950's poor people in America may have had housing, but there's a good chance that housing didn't have plumbing. Poor people in the 50's spent roughly 0% of their income on childcare. Much of the article is complaining about the cost of child care. You may think that poor people should be able to afford child care. That's a valid thought. But then you can't compare that to a 1950's definition of poverty where…

In the 60s (and 50s, though not sure why we're moving backwards) most households were single income; childcare costs were virtually nonexistent because mothers typically stayed at home to raise children, and a family would get by on the father's income alone.

That actually illustrates the point nicely: typical economic and living situations from when the metric was created were very different from today in a variety of ways, and once again, the reason the 3x food costs number was chosen -- that roughly 1/3 of income of low-income households was spent on food -- is simply no longer true.

Now, what the poverty line should be is a whole 'nother topic -- for the record the ~150k number is more as an demonstration of how broken the metric is than an actual suggestion, at least as I see it. This discussion doesn't seem to be going anywhere though so I'm tapping out, but I would still appreciate it if you would link to the article you mentioned.

Re: More Americans are breaking into the upper middle class

#89

Post by [deleted] »

tdb7893 wrote: post #6

The headline is a remarkably rosy spin on it when the subheading is "Research shows that ranks of higher earners have grown markedly over last 50 years, while lower rungs of middle class have shrunk". The article is behind a paywall but it makes it sound like inequality is increasing.

[deleted]

Re: More Americans are breaking into the upper middle class

#90

Post by myvoiceismypass »

RickJWagner wrote: post #69
balderdash wrote: post #29

the thing that doesn't compute for me is that the definition of upper middle class here is 5-15x the federal poverty line, ok, but in 1970 the federal poverty line was like ~$3k (and ~$22k today) 10x in 1970 (~33k/year) in nyc you could buy a 2,000 sqft apt for like 2.75x your salary [1] today, that same apartment is like >10x - so while perhaps more people are earning "upper middle class" incomes, what that gets you…

I remember 1970. Few people had air conditioning. Cars might last 100,000 miles, if you got a good one. They performed poorly, got awful mileage, and crushed the passenger compartment if you got into an accident. Many people smoked, and people died younger. Medicine wasn’t as good. Rich kids might have a giant set of books called an ‘encyclopedia’. It was about the only way to learn things that were outside your circ…

Am I misunderstanding something or is your point - Poor people have air conditioning and better (but certainly not cheaper) medical outcomes, and netflix today, therefore they have a better quality of life than 1970? And people without homes have better tents and jackets, today?
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