Tax reform

[Js1 86,938]

5 minutes ago, Aqua Buddha said:

The refund surprise is a story that warms my heart.  Aside from 90% of the people not understanding the tax system we have, it's like they're finally realizing that the tax cut wasn't for them.  It was so small, most of them didn't even notice throughout the year.

You mean an extra $500 a year wasn’t absolute generosity for the middle class? 

[Captainant 28,383]

8 minutes ago, Js1 said:

You mean an extra $500 a year wasn’t absolute generosity for the middle class? 

There's like, 7 or 8 Costco memberships, dude

[sidis 9,990]

12 hours ago, Mdhorn said:

Overall, they changed the withholdings so they began holding less in taxes monthly for one.  I never checked on mine thinking it's the same as it always is--why would it change if I didn't change it?  So although it gives the appearance of making more, we're not.  I don't really spend much--except on food.  Oh yeah, I thought it would be great to pay off more of the home note two years ago.  Everything for the most part is paid off--including the vehicles.  Plus we have no kids but were hit especially hard with dog surgeries.  We paid out close to 15k in dog surgeries for two pups this year.  Amazing how every surgery costs 5k--knee, stomach--doesn't matter. Oh well.  Another positive is I've booked two weeks in and around Yellowstone on July 4th so no DC festivities

i have read this post about ten times and i am still cracking up.

i absolutely loathe the new law enacted by the dipshit brigade of republican dildos and their adherence to the plutocracy.  however, 90% of this has nothing to do with taxes and appears to be rambling about random goings on.  they changed your witholdings to take out less.  you made marginally more in your paychecks.  the tables and guidance were so fucked up that no one really knew what to do.  you owe because it was a bit off.  however, if you take the amount you paid this year as a percentage of your agi from this year, and compare it to the same thing as last year, you probably paid a slightly lower effective tax rate.

this pissant amount was given to you so that you would willingly go along with providing corporations and the uber wealthy with substantially greater breaks to enable the capital for buying back all their stock or to further cement their extreme wealth.  at the cost of exacerbating our governmental budget imbalances.  congrats!  it would be helpful if you would go spend it on something worthless.

[Incredulity 11,861]

12 hours ago, Mdhorn said:

Overall, they changed the withholdings so they began holding less in taxes monthly for one.  I never checked on mine thinking it's the same as it always is--why would it change if I didn't change it?  So although it gives the appearance of making more, we're not.  I don't really spend much--except on food.  Oh yeah, I thought it would be great to pay off more of the home note two years ago.  Everything for the most part is paid off--including the vehicles.  Plus we have no kids but were hit especially hard with dog surgeries.  We paid out close to 15k in dog surgeries for two pups this year.  Amazing how every surgery costs 5k--knee, stomach--doesn't matter. Oh well.  Another positive is I've booked two weeks in and around Yellowstone on July 4th so no DC festivities

Dog surgeries???  What the fuck does that have to do with Tax Reform.

Fuck. God Damn I hate people.

[Mdhorn 6,153]

1 hour ago, sidis said:

i have read this post about ten times and i am still cracking up.

i absolutely loathe the new law enacted by the dipshit brigade of republican dildos and their adherence to the plutocracy.  however, 90% of this has nothing to do with taxes and appears to be rambling about random goings on.  they changed your witholdings to take out less.  you made marginally more in your paychecks.  the tables and guidance were so fucked up that no one really knew what to do.  you owe because it was a bit off.  however, if you take the amount you paid this year as a percentage of your agi from this year, and compare it to the same thing as last year, you probably paid a slightly lower effective tax rate.

this pissant amount was given to you so that you would willingly go along with providing corporations and the uber wealthy with substantially greater breaks to enable the capital for buying back all their stock or to further cement their extreme wealth.  at the cost of exacerbating our governmental budget imbalances.  congrats!  it would be helpful if you would go spend it on something worthless.

Wait, when did I become a Republican?  I was writing out loud and rambling about how nothing has changed all that much except for the mirage that we're making more--we're not.  They adjusted the amount in taxes we pay into monthly with the caveat of paying them at the end.  That's it! True, I could have written that in two sentences.  Another thing was Ryan was talking about doing away with mortgage deductions which would really hurt if ever enacted. 

[Captainant 28,383]

9 minutes ago, the said:

Half the country pays an average effective tax rate somewhere close to 3.6%, so a precipitous drop in that amount is still going to go unnoticed. When you barely pay anything, there's not going to be much in those tax cuts for you. 

[citation needed]

[Aqua Buddha 14,782]

13 minutes ago, the said:

Half the country pays an average effective tax rate somewhere close to 3.6%, so a precipitous drop in that amount is still going to go unnoticed. When you barely pay anything, there's not going to be much in those tax cuts for you. 

Don't tell them that.  Most of America think they pay half their salary in taxes.

[Anastasis 23,699]

This thread is no place to display a working knowledge of math and distributions. 

[Okie State 3,887]

Wait, when did I become a Republican?  I was writing out loud and rambling about how nothing has changed all that much except for the mirage that we're making more--we're not.  They adjusted the amount in taxes we pay into monthly with the caveat of paying them at the end.  That's it! True, I could have written that in two sentences.  Another thing was Ryan was talking about doing away with mortgage deductions which would really hurt if ever enacted. 

Well, no...as has been mentioned numerous times in this very thread, some people actually did pay less if they took the time to look at what they actually paid and their effective tax rate change. The argument seems to be that it was an irrelevant amount when compared to the breaks received by corporations and the super wealthy. I'd argue that it is all relative and the absolute dollar figure is less important than the impact on an individual household's budget. While $1,000 is peanuts to some, it is significant to others. I also understand how many people piss away any increase in income on garbage rather than reallocate it to something useful so in that case it was pointless.

All of that said, I still believe that the corporate tax breaks were unnecessary and will likely do a significant amount of long term damage for minimal short term gain.

[Captainant 28,383]

22 minutes ago, the said:

https://taxfoundation.org/summary-federal-income-tax-data-2017/

Rep for giving a source, but you're misreading the data. You're likely citing the line that says:

Quote

• In 2015, the top 50 percent of all taxpayers paid 97.2 percent of all individual income taxes while the bottom 50 percent paid the remaining 2.8 percent.

The bottom 50% contributing only 2.8% of income tax revenue doesn't mean that they're paying a 2.8% rate, otherwise they'd be earning the same as the top 50%. Which is contradictory lol. From a search, the US median tax rate is 15%, so I really doubt that everyone below the median is somehow paying 2.8% lmao.

[Mdhorn 6,153]

23 minutes ago, Okie State said:

Well, no...as has been mentioned numerous times in this very thread, some people actually did pay less if they took the time to look at what they actually paid and their effective tax rate change. The argument seems to be that it was an irrelevant amount when compared to the breaks received by corporations and the super wealthy. I'd argue that it is all relative and the absolute dollar figure is less important than the impact on an individual household's budget. While $1,000 is peanuts to some, it is significant to others. I also understand how many people piss away any increase in income on garbage rather than reallocate it to something useful so in that case it was pointless.

All of that said, I still believe that the corporate tax breaks were unnecessary and will likely do a significant amount of long term damage for minimal short term gain.

It was known they were totally unnecessary. Lindsey Graham said as much when he said they had to pass the cuts so their donors would continue to donate.  It breaks down as this, taxes either come from corporations and the upper crust or the middle class either pays more to make up the difference.

I think we're agreeing to the same thing. 

Edited February 25, 2019 by Mdhorn

[Anastasis 23,699]

13 minutes ago, the said:

I'm not misreading the data, I rounded down 3.59% instead of rounding it up. So that's on me, but it still has a 3 handle. 

Look at the tables, they're paying 3.59% effective tax rate. Although contributing 2.8% to the total income tax collected. 

This thread is also apparently not the right place for reading comprehension related to data and statistics. 

[Aqua Buddha 14,782]

Most people pay little to no income tax.  They pay some FICA but they think it's income tax.  Throw is 5-10% in SALT and they've taken to the streets with their Tea Party pitchforks.

[Mdhorn 6,153]

6 minutes ago, Aqua Buddha said:

Most people pay little to no income tax.  They pay some FICA but they think it's income tax.  Throw is 5-10% in SALT and they've taken to the streets with their Tea Party pitchforks.

I throw it around loosely--I'm lumping it all in one category as tax.  It either raises or drops, which unfortunately, is how most are going to see it. 

[sidis 9,990]

1 hour ago, Mdhorn said:

the mirage that we're making more--we're not.

look mdhorn, we generally agree about the tax law.  and the salt deduction removal absolutely hosed me.  it was a complete screw job in favor of corps and uber wealthy.

however, for clarity (as this seems to be really confusing for some amazingly), here is a super-simplified example as to what I think most people are misunderstanding in their angst when they say they "didn't make more."  there are exceptions to this (such as my personal situation) but the following likely applies to most.

2017:

salary for year: $100

monthly withholding: $2

effective tax rate after complicated deductions/credits/etc...: 20%

thus, in paying $24 in taxes when you only owed $20, you get a refund of $4 when you file your taxes.  you netted $80 for the year after taking home $76 in paychecks ($6.33 per monthly check) and $4 refund.

 

2018

salary for year: $100

NEW, ADJUSTED monthly withholding: $1

effective tax rate after complicated deductions/credits/etc...: 15%

thus, in paying $12 in taxes when you actually owed $15, you now owe $3 when you file your taxes.  however, you netted $85 for the year after taking home $88 in paychecks ($7.33 per monthly check - a dollar more than the previous year) and $3 payment to irs.

 

thus, you did make more by $5 in 2018 than 2017 even though you owe the irs due to the overly aggressive changes in withholdings that a lot of payroll did since they couldn't really figure out the guidance.

[elfenix 34,658]

43 minutes ago, the said:

Not to be mean, but you and they are all wrong. Because the employer/the wealthy that employs you and them contribute penny for penny that you do. I just posted this in another thread, an employer with 100 employees paying $50K in annual wage will pay $382,500 in FICA while that employee would only pay $3,825. If that employer's yearly profits were $1,000,000, and he didn't have to contribute for his employees his profits would be $1,382,500 instead of a million. Those are some real numbers that most of the stupid populace does not calculate in their complaints about the tax system. 

For every penny they pay, the wealthy are paying far far more. 

[Pig Bellmont 8,867]

Is this where everyone posts angrily and incorrectly about taxes? Ugh. 

[Keef 852]

56 minutes ago, the said:

Not to be mean, but you and they are all wrong. Because the employer/the wealthy that employs you and them contribute penny for penny that you do. I just posted this in another thread, an employer with 100 employees paying $50K in annual wage will pay $382,500 in FICA while that employee would only pay $3,825. If that employer's yearly profits were $1,000,000, and he didn't have to contribute for his employees his profits would be $1,382,500 instead of a million. Those are some real numbers that most of the stupid populace does not calculate in their complaints about the tax system. 

For every penny they pay, the wealthy are paying far far more. 

This assumes, of course, that corporations don't just build the cost of paying the tax into the product/services they provide.  Which they do.  Once they get a tax cut, do you see a corresponding reduction in prices?  Nope. 

We pay the taxes for them, by virtue of higher priced goods and services.

[Incredulity 11,861]

7 minutes ago, Keef said:

This assumes, of course, that corporations don't just build the cost of paying the tax into the product/services they provide.  Which they do.  Once they get a tax cut, do you see a corresponding reduction in prices?  Nope. 

We pay the taxes for them, by virtue of higher priced goods and services.

let me guess.  You view employee wages as a "write off".

 

 

[ChiTownDoc 21,323]

4 hours ago, Incredulity said:

Dog surgeries???  What the fuck does that have to do with Tax Reform.

Fuck. God Damn I hate people.

You should consider more dog surgeries.  Being that people suck and all.  

[Anastasis 23,699]

1 hour ago, ChiTownDoc said:

You should consider more dog surgeries.  Being that people suck and all.  

At $5k a pop it doesn't sound like a bad gig if you are good with the knife.

 

[Mojo Hand 4,580]

On 2/25/2019 at 8:00 AM, Aqua Buddha said:

The refund surprise is a story that warms my heart.  Aside from 90% of the people not understanding the tax system we have, it's like they're finally realizing that the tax cut wasn't for them.  It was so small, most of them didn't even notice throughout the year.

Yep.  Or if they did notice, they're now realizing it was much smaller than they had thought because part of it was due to withholding differences, not the "cut."  After the tax bill took effect, one of my Trump supporting relatives emailed everyone something to the effect of "I got $117 dollars more back in my first paycheck under the new tax bill, elites like Nancy Pelosi might think that's crumbs, but I'm quite sure I can put it to good use."  Haven't heard anything from her during tax season so far.

That's the thing.   The GOP was quite happy for people to think it was all tax cut last year, because mid-terms.

[happyfunball 481]

https://www.nytimes.com/2019/02/24/opinion/income-inequality-upper-middle-class.html

I think the chart above helps to resolve the debate. It shows that both sides have a point — but that it’s a mistake to divide the country into only two groups. To make grand pronouncements about the American economy, you need to talk about three groups.

The first is indeed the top 1 percent of earners, and especially the very richest. Their post-tax incomes (and wealth) have surged since 1980, rising at a much faster rate than economic growth. They are now capturing an even greater share of the economy’s bounty.

Then there are the bottom 90 percent of households, who are in the opposite position. The numbers here take into account taxes and government transfers, like Social Security, financial aid and anti-poverty benefits. Even so, the incomes of the bottom 90 percent have trailed G.D.P. Over time, their share of the economy’s bounty has shrunk.

Finally, there is the upper middle class, defined here as the 90th to 99th percentiles of the income distribution (making roughly $120,000 to $425,000 a year after tax). Their income path doesn’t look like that of either the first or second group. It’s not above the line or below it. It’s almost directly on top of it. Since 1980, the incomes of the upper middle class have been growing at almost the identical rate as the economy.

[Bozo_Casanova 26,773]

The idea that the 90th-99th percent of incomes is “upper middle” class is so absurd I don’t know where to begin.

[Anastasis 23,699]

Just now, Bozo_Casanova said:

The idea that the 90th-99th percent of incomes is “upper middle” class is so absurd I don’t know where to begin.

It's far from absurd. I'd probably shave a few percentile points off the top end of the range and run it something like 90th-97th (tops at 289k household). The top end would represent a dual income household of mid career professionals. Sounds upper middle class to me.  

[Bozo_Casanova 26,773]

It's far from absurd. I'd probably shave a few percentile points off the top end of the range and run it something like 90th-97th (tops at 289k household). The top end would represent a dual income household of mid career professionals. Sounds upper middle class to me.  

It’s not. The middle is the middle. Just because the wealth of the very, very top has exploded and the top hasn’t doesn’t make rest of the top not the top. It makes rest of the top stupid for complicity in their own impoverishment.  

 

But they are still the top. Two Mid-career professionals? Are you serious with this? They aren’t middle class that’s insane. Cashiers and vet techs are middle class.

 

And there’s nothing that pisses me off more than garden variety rich people like you and me poor mouthing like they are part of the actual American middle class, who can not afford anything approximating the “middle class” lifestyle we take for granted.

 

 

 

[Bozo_Casanova 26,773]

Right. The word “Middle” should be expanded to include the petty rich so as to not hurt the feelings of rich people who don’t want to feel like failures because they aren’t as rich as the richest people.

 

If you have healthcare, and can afford to buy a home in a city with a thriving local economy, carry a car payment, go on vacation with your family and educate your kids while also saving for retirement you are not, period, not middle class in this country.

 

 

[Coors yellow belly 105]

I got an extra $200 dollars, so now I will vote for Trump.

[SaucyJack 3,517]

18 minutes ago, Bozo_Casanova said:

And there’s nothing that pisses me off more than garden variety rich people like you and me poor mouthing like they are part of the actual American middle class, who can not afford anything approximating the “middle class” lifestyle we take for granted.

 

What's your definition?

Edited February 27, 2019 by SaucyJack

[Anastasis 23,699]

26 minutes ago, Bozo_Casanova said:

It’s not. The middle is the middle. Just because the wealth of the very, very top has exploded and the top hasn’t doesn’t make rest of the top not the top. It makes rest of the top stupid for complicity in their own impoverishment.  

But they are still the top. And there’s nothing that pisses me off more than garden variety rich people like you and me poor mouthing like they are part of the actual American middle class, who can not afford anything approximating the “middle class” lifestyle we take for granted.

I have consistently rejected a distributional approach to defining the "middle class", for  reasons that you allude to.  The American Middle Class is defined by a set of lifestyle characteristics common to a certain stratum of the socioeconomic segmentation.  It's not a bracket of the household income distribution. Historically, some of these characteristics were accessible home ownership, accessible secondary education, career professionals with relative job security, the ability to engage in recreation and leisure activities with disposable income after covering their primary needs and setting something aside for retirement, etc. These are the characteristics that define the middle class imo, with a range from lower to upper middle class. If you want to pull down a straight up distributional middle class, "middle is middle", the middle class ranges from 30k to 110k household (25th-75th percentiles).  30k is poverty level for a family of 4. That's not middle class by any realistic measure.  110k in a dual income household with 2-3 kids doesn't check many of the boxes I listed.  I would hardly classify that as upper middle class.  Distributional assessments really break down in this discussion.  I think that we would agree that the middle class is getting smaller and being eroded in this country.  Distributional arguments like "middle is middle" fail to acknowledge this. I am not sure where the lower end of middle income would be, somewhere in 50-60th (60-85k).  But that gets pretty tight on the lower end. I could see a higher cut point. All very dependent on geographic region and number of persons in household and a variety of other factors.  

Edited February 27, 2019 by Anastasis

[Anastasis 23,699]

9 minutes ago, Bozo_Casanova said:

Right. The word “Middle” should be expanded to include the petty rich so as to not hurt the feelings of rich people who don’t want to feel like failures because they aren’t as rich as the richest people.

 

If you have healthcare, and can afford to buy a home in a city with a thriving local economy, carry a car payment, go on vacation with your family and educate your kids while also saving for retirement you are not, period, not middle class in this country.

Yeah, see I totally disagree.  These characteristics are the epitome of the American Middle Class concept. We have eroded the Middle Class by making these things unattainable to those with middle income. Redefining the concept of the middle class using distributional arguments is not productive in my opinion. Middle Class dne middle income.  On that we agree. 

[Bozo_Casanova 26,773]

The two that make the most sense to me are based on income and wealth.

The Pew Research Center uses a metric which is .6-2X the median income, or roughly the middle 3/5 of the income spectrum, which works out to about $45-140k/yr. Obviously that’s got considerable local variability but works on the scope of their research with a national aggregate number.

Wealth focused metrics generally use the middle 3/5ths of net worth, which basically takes you from a net worth of zero to about $400k.


There are other mainstream ways to defining it, including what people spend, what they wish they had and matrices of age/race/education (the Fed likes that one) but non of those really hang for me. But even if they did, none would include the 90th-99th %ile in any definition of “middle”.

[Bozo_Casanova 26,773]

Yeah, see I totally disagree.  These characteristics are the epitome of the American Middle Class concept. We have eroded the Middle Class by making these things unattainable to those with middle income. Redefining the concept of the middle class using distributional arguments is not productive in my opinion. Middle Class dne middle income.  On that we agree. 

So you want to redefine “middle” to mean a set of class attributes that are unattainable for that class? That makes no sense. The “American Middle Class Concept” is no longer middle class. It’s what constitutes little rich. And you can’t talk about what’s happening to the middle class if you insist on including those who can still get what isn’t available or attainable to those in the middle. I’m not being distributional. I just refuse to engage in the kind of political newspeak that obscures our economic reality with nostalgic fiction. And since we agree on the core point, I’m not sure why you do.

 

 

 

[JimmyJames 12,271]

1 hour ago, happyfunball said:

https://www.nytimes.com/2019/02/24/opinion/income-inequality-upper-middle-class.html

I think the chart above helps to resolve the debate. It shows that both sides have a point — but that it’s a mistake to divide the country into only two groups. To make grand pronouncements about the American economy, you need to talk about three groups.

The first is indeed the top 1 percent of earners, and especially the very richest. Their post-tax incomes (and wealth) have surged since 1980, rising at a much faster rate than economic growth. They are now capturing an even greater share of the economy’s bounty.

Then there are the bottom 90 percent of households, who are in the opposite position. The numbers here take into account taxes and government transfers, like Social Security, financial aid and anti-poverty benefits. Even so, the incomes of the bottom 90 percent have trailed G.D.P. Over time, their share of the economy’s bounty has shrunk.

Finally, there is the upper middle class, defined here as the 90th to 99th percentiles of the income distribution (making roughly $120,000 to $425,000 a year after tax). Their income path doesn’t look like that of either the first or second group. It’s not above the line or below it. It’s almost directly on top of it. Since 1980, the incomes of the upper middle class have been growing at almost the identical rate as the economy.

What you and the Times are calling “upper middle class” I think is more accurately called the “professional” class. You got your doctors, lawyers, university professors, small business owners, architects, accountants, upper management, etc. That’s generally the top 15 percent of income earners. 

I don’t doubt that this groups income has chugged right along with GDP over the years. It’s in the interest of the top .0001 percent who are currently hoarding the grotesque majority of this country’s new wealth to keep both the professional class relatively happy and give the lower class, including what we used to know as the middle class, someone else to resent instead of the top .0001 percenters.

Think about it. How much contact does the bottom 90 percent have with the top .0001 percent? None. Never. Zilch. 

How much contact does the bottom 90 percent have with the professional class? Quite a bit. And the professional class gets to tell them what to do, (watch your weight fatass, study for this test, get me a TPS report, fetch me some coffee, you fucked up your taxes last year, pay me 5k or your’re going to jail for DWI,) while looking relatively wealthy in comparison while the lower and middle class get poorer and poorer. It breeds understandable resentment that is misdirected as to where it should be going, namely the thieves at the top .0001 percent.

This latest republican tax scame is the perfect example of what is and has been going on for damn near 40 years and is nothing but a money grab by the top .0001 percent at the expense of every fucking other person in the country. It’s obscene and the fact that the republicans support it should doom them to minority status for not just years, but decades. 

[Anastasis 23,699]

 

9 minutes ago, Bozo_Casanova said:

The two that make the most sense to me are based on income and wealth.

The Pew Research Center uses a metric which is .6-2X the median income, or roughly the middle 3/5 of the income spectrum, which works out to about $45-140k/yr. Obviously that’s got considerable local variability but works on the scope of their research with a national aggregate number.

Wealth focused metrics generally use the middle 3/5ths of net worth, which basically takes you from a net worth of zero to about $400k.


There are other mainstream ways to defining it, including what people spend, what they wish they had and matrices of age/race/education (the Fed likes that one) but non of those really hang for me. But even if they did, none would include the 90th-99th %ile in any definition of “middle”.

 Total net assets would be much better than income, but has its own set of limitations. 

 

6 minutes ago, Bozo_Casanova said:

I just refuse to engage in the kind of political newspeak that obscures our economic reality with nostalgic fiction.

It is not newspeak.  Social class has historically been defined with components of lifestyle and culture in addition to weatlth. It's just harder for economists to measure and classify those lifestyle and culture so they use income as a proxy.  Which is fine, as long as you don't conflate middle income with middle class. 

Here's an interesting overview from Brookings on the topic.

https://www.brookings.edu/research/defining-the-middle-class-cash-credentials-or-culture/

Definitions of the middle class (and indeed of classes generally) tend to fall into one of the three broad categories, based on economic resources; on education and occupation status; or on attitudes, self-perception, and mindset. Determining whether you are “middle class” requires different information for each of these three categories. For the first (cash), we need to see your bank balance. For the second (credentials) we need to see your résumé. For the third (culture), we need to see inside your head.

• Cash: economic resources, especially income, wealth, freedom from poverty
• Credentials: educational achievements and qualifications, occupational status
• Culture: attitudes, mindset, behavior, self-definition

These definitions will of course overlap with and reinforce each other. Levels of education, for example, are highly correlated with income (through earnings), and becoming more so. People doing jobs with a certain social status are likely to define themselves as middle class. Aspiring to college or having a saver mentality are likely to lead to a bigger bank balance, and so on.

But it is important to be as clear as possible about which of these three broad approaches we are adopting for a particular purpose, especially when it comes to policy. We examine a range of approaches under each of these three broad headings, occasionally suggesting ways in which their selection can influence research findings and/or policy priorities.

 

And the approach summarized in the section below yields thresholds within 1-2 %ile points +/- to the ones that I proposed upthread (below converts roughly to 40-95%ile). 

 

Brian Cashell takes the innovative approach of combining surveys capturing self-definitions of class to determine the upper and lower income thresholds. He concludes:

“No attempt to identify the middle class in the income distribution can be expected to yield a precise answer. But the term is used so often, it is worth the effort to attach some numbers to it. … Surveys indicate many people felt an income near $40,000 was the minimum to be considered middle class. On the other end, surveys suggested that those with incomes approaching $200,000 might still be considered middle class.”

Since Cashell was writing a decade ago, we have updated this range to $46,000 to $230,000 to account for inflation. Assuming that this represents an income level for a household of three (close to the size of the average U.S. household), 61 percent of households are part of this self-defined middle class.

[Anastasis 23,699]

29 minutes ago, Bozo_Casanova said:

So you want to redefine “middle” to mean a set of class attributes that are unattainable for that class? That makes no sense.

From my perspective you conflate "middle class" and "middle income".  I don't think that is appropriate.

 

Article from The Atlantic, perspective from a cultural anthropologist on the topic:

 

https://www.theatlantic.com/ideas/archive/2018/11/what-does-middle-class-really-mean/574534/

Does the U.S. Still Have a ‘Middle Class’?

White-collar work today is fundamentally insecure.

NOV 4, 2018

Caitlin Zaloom

Associate Professor of Social and Cultural Analysis at New York University

ARTAZUM / PHOTO_JEONGH / SUMROENG CHINNAPAN / SHUTTERSTOCK / KATIE MARTIN / THE ATLANTIC

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The question of how to define the middle class is one of the perennial mysteries of American social life. Most people say they’re “middle class,” so how can we know what this really means? Every few years some intrepid social scientists venture a new definition.

 

This September, the Brookings Institution economists Richard Reeves and Katherine Guyot argued that the middle class is “the middle 60 percent of households on the income distribution,” which represents $37,000 to $147,000 for a three-person household. Full stop. Downplaying the importance of education, they wrote that income is the most useful measure of class because it captures all of the other conditions that make a person middling, including consumption, education, and relative social standing; it is not only how much money individuals take home.

Definitions that conflate income and class are all too common. For instance, in a well-cited 2015 article, “The American Middle Class Is Losing Ground,” the Pew Research Center used the terms middle class and middle incomeinterchangeably; by “middle class” they meant households that take home “two-thirds to double the national median” income.

The main problem with this approach is obvious: The same income buys a vastly different quality of life in different parts of the country. That is to say, $60,000 goes much further in Missoula, Montana, than in Brooklyn, New York.

There’s another problem: Class has always been about more than earnings. For many decades, social scientists and historians have debated how jobs, education, politics, consumption, and, yes, income come together with values, habits, geography, and social status to create class in America. In other words, the question is not who but what makes the middle class. Today there can be no pretending that middle-class status is anchored by a single economic reality. Instead, it is primarily an aspiration.

Being middle class means striving for the stability and respectability that older generations achieved by holding down steady jobs, owning a home, and raising upright kids who could take their place. These benchmarks are no longer simple to attain. Instead, middle-class desires are marred by an insecurity historically associated with the American working class. Definitions should reflect that.

 

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In his 1951 landmark book, White Collar, the sociologist C. Wright Mills offered a way to study the middle class that remains useful today, despite vastly changed circumstances. He did not seek merely to delineate the middle class, but to explain what it is like—socially and psychologically—to live in the middle of the class structure.  

Since the 1830s, clerks and small-scale entrepreneurs had been carving out a space between factory workers and factory owners in northern cities. Men worked with their head, not their hands. They spent their days bent over account books in offices while their wife stayed behind to make sure that the home was clean, the cupboard stocked, and the children tended to.

By the mid-1900s, this in-between class worked in large, impersonal bureaucratic organizations that changed little. They managed people and manipulated numbers and words, keeping corporate offices and government bureaus humming with activity.

Read: The decline of social mobility in America

Unlike laborers below them, white-collar workers were unlikely to send a piece of their paycheck to local AFL-CIO chapters. They enjoyed higher, more consistent pay, and were willing to accept company goals as their own. Mills’s colleague William H. Whyte found that these office workers identified so completely with their corporate or government job that he named a new social type for them: “the organization man.”

 

Organization men were attached to their firm— they were psychologically “dependent.” Beyond their personal commitments, moreover, these mid-rung workers were dependent in another crucial way: They did not make decisions about the shape of their job. Owners and high-level executives controlled and spelled-out white-collar responsibilities, from pushing paper to smiling at potential customers.

 

 

This work contained little inherent satisfaction, so the fact that it provided income—putting Wonder Bread on the kitchen table and a Buick in the driveway—became the singular reason to make the commute from the suburbs each morning. Stability on the job gave shape to the idealized nuclear family, one that white-collar men and women could imagine anchoring their children’s adulthoods, too. White-collar privileges meant that parents could draw on the husband’s steady salary to send their children through high school or college and on toward their own constant suburban life.

Americans have inherited their idea of middle-class work and respectability from this long-gone era. Even then, class could not be reduced to income—but white-collar stability made it possible to assume that income was a reasonable stand-in. A respectable family could be supported for decades on a good wage in a solid company. Income was not simply a snapshot in a moment of family life; it was a reliable predictor. But manipulating words and numbers isn’t what it once was.

 

To define class in 2018, it would be better to follow White Collar’s example by examining the conditions of work and status than to lean on an outdated proxy.

By the 1990s, the world that Mills had documented was coming apart, as corporate downsizing and disinvestment upended the neat equation of secure work and a praiseworthy home life. Social thinkers writing in that decade, including the sociologist Katherine Newman and the journalist Barbara Ehrenreich, followed Mills in charting the social and psychological shape of that in-between class. But they found that loss had replaced dependency as the most conspicuous feeling associated with middling workers’ place in the hierarchy.

Today anguish over lost social standing has, in turn, been replaced by a pervasive sense of insecurity.

Read: What it would take to save the middle class

Contingent work has changed the landscape of employment. According to the economists Lawrence Katz and Alan Krueger, today 15 percent of workers are in nontraditional or alternative positions, and from 2005 to 2015, “alternative” jobs accounted for 94 percent of net job growth.

 

Steady work can feel uncertain, too, as some jobs no longer hold the real promise of financial stability, let alone upward mobility. Across many states, for example, tax and service cuts have left teachers without raises as they grapple with outsize classes, crumbling infrastructure, and ancient textbooks. Nurses have also seen the growth of temporary work, which exposes these medical professionals to rapid-fire changes as they move from hospital to hospital for the next job.

Eroded work is such a cornerstone of middle-class life that middle-rung workers lean on contingent jobs to buoy their income. Uber has even built this into its business model. As the journalist Alissa Quart has reported, Uber actively recruits teachers and nurses into its ride service, especially in regions like the Bay Area where living costs are so high that even a secure income of more than $100,000 can leave a family in tough straits to pay for the housing and day care it needs to work in the first place.

 

 

The rise of contingent and eroded work is the result of a corporate strategy. Reducing the number of steady, dependent employees and replacing them with temporary workers or contractors relieves business leaders from having to offer expensive benefits and boosts profits. Work might still be boring, and now it can’t be counted on.

 

Uncertainty comes from other sources, too.

Many white-collar workers, including loan officers, customer-service representatives, and paralegals, live in the sights of artificial-intelligence engineers. So do pilots, journalists, and lawyers. Researchers at the Oxford Internet Institute have estimated that 47 percent of U.S. jobs are at risk in the current wave of computerization.

Read: Wages are low and workers are scarce. Wait, what?

Insecure work has been matched by insecurity in family life, as well. In mid-century, white-collar parents wanted their children to make stable lives that looked like their own, and their children were able to do it, too; today, that’s much more difficult.

A college education for the kids has long been at the core of respectability, but now it comes at a historically novel social and psychological cost. Because college is so expensive, students shoulder debts that follow them through their 20s, shaping their decisions about where to work, what to buy, and when to marry. Parents, meanwhile, find that the cost of college consumes savings and redirects funds that might have been socked away for retirement.

 

Although middle-age Americans have always carried the most debt, relying on home loans and credit-card charges to build their family, now they must also take out loans to meet their children’s tuition responsibilities. As students hit the ceiling on their federal borrowing, parents are stepping in to fill the gap. Household debt is graying, the Federal Reserve Bank of New York has found. Borrowers in their later years—between the ages of 50 and 80— have propelled consumer debt to its new heights.

Aspiring to stability and respectability today means not only navigating the landscape of eroded and contingent work, but managing debts. Trying to give children a shot, parents take on financial burdens that can destabilize their own future security.

Class has always been partly about income, but debt is now an equal component of the middle-class story, leading to a central paradox of aspirational lives: Striving for stability and respectability means inhabiting insecurity both socially and psychologically. Economic metrics alone can tell only a shallow story, but at the very least, debt should join income in any attempt at definition.

The deeper story lies beyond these metrics, however. The middle class is tricky to define today because the secure jobs and stable home lives that supplied its historical definition are now gone for most Americans.

Under these conditions, it may no longer even make sense to talk about the “middle class” at all. New concepts may be necessary to describe the social stratification in America’s polarized society.

We want to hear what you think about this article. Submit a letter to the editor or write to letters@theatlantic.com.

 

 

CAITLIN ZALOOM is a cultural anthropologist, Associate Professor of Social and Cultural Analysis at New York University, and Editor in Chief of Public Books.

Edited February 27, 2019 by Anastasis
added article

[berlinerbaer 692]

51 minutes ago, JimmyJames said:

What you and the Times are calling “upper middle class” I think is more accurately called the “professional” class. You got your doctors, lawyers, university professors, small business owners, architects, accountants, upper management, etc. That’s generally the top 15 percent of income earners. 

I don’t doubt that this groups income has chugged right along with GDP over the years. It’s in the interest of the top .0001 percent who are currently hoarding the grotesque majority of this country’s new wealth to keep both the professional class relatively happy and give the lower class, including what we used to know as the middle class, someone else to resent instead of the top .0001 percenters.

Think about it. How much contact does the bottom 90 percent have with the top .0001 percent? None. Never. Zilch. 

How much contact does the bottom 90 percent have with the professional class? Quite a bit. And the professional class gets to tell them what to do, (watch your weight fatass, study for this test, get me a TPS report, fetch me some coffee, you fucked up your taxes last year, pay me 5k or your’re going to jail for DWI,) while looking relatively wealthy in comparison while the lower and middle class get poorer and poorer. It breeds understandable resentment that is misdirected as to where it should be going, namely the thieves at the top .0001 percent.

This latest republican tax scame is the perfect example of what is and has been going on for damn near 40 years and is nothing but a money grab by the top .0001 percent at the expense of every fucking other person in the country. It’s obscene and the fact that the republicans support it should doom them to minority status for not just years, but decades. 

This right here. Each socioeconomic stratum hates the one immediately above and below it. The "middle" (working) class despises the welfare moochers below them and holds their daily credentialed overlords in disdain while giving the top 1% a pass simply due to ignorance.

IOW the ideal Republican voter.

[JimmyJames 12,271]

So I decided to actually try to look at this objectively and figured that maybe we can all agree that median income for a household would be somewhere in the middle class? Maybe that’s too much to ask but I thought it might work.

Anyway, median household income is approximately 61k. If you figure a family making that amount with 2 kids using the standard deduction instead of itemized deduction, then the median household would save approximately $1,700 a year in income taxes as a result of the recent republican tax scam. I’m sure some high SALT states get fucked much more than that but those states vote dem, so you know, fuck em. 

So if accurate, that means half the country saves somewhere between $0 and $1,700 a year in taxes. Presumably then the upper 50 percent saves somewhere betweeen $1,700 and several million here or there depending on income level. 

I guess I’d be for it if it didn’t explode the deficit by about 2 trillion or so. Just like Mrs. Lincoln would have enjoyed the play except, well you know. 

Party of fiscal responsibility. 

[Incredulity 11,861]

2 minutes ago, JimmyJames said:

So I decided to actually try to look at this objectively and figured that maybe we can all agree that median income for a household would be somewhere in the middle class? Maybe that’s too much to ask but I thought it might work.

Anyway, median household income is approximately 61k. If you figure a family making that amount with 2 kids using the standard deduction instead of itemized deduction, then the median household would save approximately $1,700 a year in income taxes as a result of the recent republican tax scam. I’m sure some high SALT states get fucked much more than that but those states vote dem, so you know, fuck em. 

So if accurate, that means half the country saves somewhere between $0 and $1,700 a year in taxes. Presumably then the upper 50 percent saves somewhere betweeen $1,700 and several million here or there depending on income level. 

I guess I’d be for it if it didn’t explode the deficit by about 2 trillion or so. Just like Mrs. Lincoln would have enjoyed the play except, well you know. 

Party of fiscal responsibility. 

Well I think that’s a fine story, and you tell it so well.

[JimmyJames 12,271]

1 minute ago, Incredulity said:

Well I think that’s a fine story, and you tell it so well.

Glad you enjoyed it Forrest. 

[berlinerbaer 692]

1 hour ago, Anastasis said:

I have consistently rejected a distributional approach to defining the "middle class", for  reasons that you allude to.  The American Middle Class is defined by a set of lifestyle characteristics common to a certain stratum of the socioeconomic segmentation.  It's not a bracket of the household income distribution. Historically, some of these characteristics were accessible home ownership, accessible secondary education, career professionals with relative job security, the ability to engage in recreation and leisure activities with disposable income after covering their primary needs and setting something aside for retirement, etc. These are the characteristics that define the middle class imo, with a range from lower to upper middle class. If you want to pull down a straight up distributional middle class, "middle is middle", the middle class ranges from 30k to 110k household (25th-75th percentiles).  30k is poverty level for a family of 4. That's not middle class by any realistic measure.  110k in a dual income household with 2-3 kids doesn't check many of the boxes I listed.  I would hardly classify that as upper middle class.  Distributional assessments really break down in this discussion.  I think that we would agree that the middle class is getting smaller and being eroded in this country.  Distributional arguments like "middle is middle" fail to acknowledge this. I am not sure where the lower end of middle income would be, somewhere in 50-60th (60-85k).  But that gets pretty tight on the lower end. I could see a higher cut point. All very dependent on geographic region and number of persons in household and a variety of other factors.  

I agree with this. I look at "middle class" as meaning earning a living through "work" in the usual sense, that is translating manual labor or a more refined skill into the production of goods or services. This could be flipping burgers, toiling in an assembly line, grading exams, managing someone's financial portfolio, or performing open heart surgery.

A member of the upper class OTOH is someone able to live purely off the economy, earning the majority of their income through stocks, interest, trust funds, equity, etc. They are a world away from anything resembling a traditional 40 hour work week.

Actual income doesn't really matter.

[Aqua Buddha 14,782]

Strip away the numbers and look at the trappings.  We like to think "middle class" means you own your own home, two cars, wife works/maybe she doesn't, kids to good schools, you take vacation every year and put away money for retirement.  What I've just described is upper class.

True middle class are renters with no savings who kids go to sketchy schools.

[Anastasis 23,699]

11 minutes ago, Aqua Buddha said:

Strip away the numbers and look at the trappings.  We like to think "middle class" means you own your own home, two cars, wife works/maybe she doesn't, kids to good schools, you take vacation every year and put away money for retirement.  What I've just described is upper class.

True middle class are renters with no savings who kids go to sketchy schools.

Or, alternatively, the trappings traditionally accounted as core middle class attributes are increasingly not accessible to people with middle income. Being able to take a vacation every year and save towards retirement are not trappings exclusive to the upper class, imo. I will agree however that those things are really only widely accessible to a limited upper middle and upper income range. Or to mid-range middle income earners who are willing to take on a significant debt load. 

Edited February 27, 2019 by Anastasis

[elfenix 34,658]

15 hours ago, Bozo_Casanova said:

The idea that the 90th-99th percent of incomes is “upper middle” class is so absurd I don’t know where to begin.

on the old board i proposed the term "petit rich" for these.   i'd probably toss some people who have upper 6 or even 7 figure incomes into the group if the earning window is short (athletes), although a lot of those guys make enough money and have the sense to invest in assets that mean their jobs after the high earning period are managing their assets, which puts them into regular old "rich"

Edited February 27, 2019 by elfenix

[gmr548 16,681]

Y'all are debating semantics at this point on the middle class thing.

Sent from my SM-G920V using Tapatalk

[David Dennison 19,441]

4 minutes ago, elfenix said:

on the old board i proposed the term "petit rich" for these. 

Or good old petite bourgeoisie.

Too Marxist?

[Anastasis 23,699]

42 minutes ago, gmr548 said:

Y'all are debating semantics at this point on the middle class thing.

Sent from my SM-G920V using Tapatalk
 

Semantics and terminology are important, especially when it is translated to public policy. 

[Bozo_Casanova 26,773]

1 hour ago, elfenix said:

on the old board i proposed the term "petit rich" for these.   i'd probably toss some people who have upper 6 or even 7 figure incomes into the group if the earning window is short (athletes), although a lot of those guys make enough money and have the sense to invest in assets that mean their jobs after the high earning period are managing their assets, which puts them into regular old "rich"

I think petit rich is a good term and used it above. 

[elfenix 34,658]

16 minutes ago, Bozo_Casanova said:

I think petit rich is a good term and used it above. 

ah i see it. hadn't gotten through the thread yet.

[Coors yellow belly 105]

Imagine watching this and not thinking the President should be in jail