The median household income in the US is around $52,000. So can households earning twice that much really consider themselves middle class?
That's one question raised in a recent Pew Research Center report on post-recession economic policy. On its face, the report shows that rich Americans greatly underestimate how rich they really are, and that, once again, Americans' conceptions of what it means to be middle class seem to defy logic. But given what the middle-class lifestyle costs, it may be that you simply have to be rich to be middle class in America.
Here's one fascinating finding: only 1 percent of Americans consider themselves upper class:
(Numbers may not add up to zero, due to small share of people who responded, "don't know.")
Not only that, but a majority of people in households earning $100,000 or more per year consider themselves middle class.
Depending on how you look at it, the numbers can seem downright ridiculous — if you count the upper-middle and lower-middle groups as part of a broader middle, 87 percent of Americans are middle class, leaving very little to be in the middle of. (This sort of statistic has popped up before; Paul Krugman pointed out something similar earlier this year in other survey findings.)
But it's nevertheless true that Americans are predisposed to thinking of themselves as in the middle. The Wall Street Journal and NBC found in a 2013 poll that people tend to think of their particular income levels as the definition of the middle class. Relatedly, as Brookings' Richard Reeves pointed out recently, Americans seem to define "rich" as "richer than me." But when people think of the middle class, it may be that they feel their income does not provide what they think of as a middle-class American life — a life that can be remarkably hard to achieve.
Being "middle class" is about far more than money
Of course, middle class doesn't have to be defined in terms of income — it's not that the nation has to be perfectly divided into thirds of people who think of themselves as upper, middle, and lower (or fifths of upper, upper-middle, and so on). Krugman himself wrote that it's about stability and opportunity, for example. In fact, a better way of defining it may be in terms of aspirations, as a 2010 Commerce Department report wrote, and that report already did the work on computing what a middle-class life can cost.
The report listed broad categories of things many middle-class households want: homeownership, car ownership, family vacations, health security, retirement security, and a college education for their kids.
That's all pretty basic from one point of view, but when you consider the costs, it's fantastically expensive. The Commerce Department came up with theoretical budgets for three hypothetical two-parent families, each with vastly different earnings:
But these are all, of course, different flavors of the "middle class" lifestyle; the report assumes the child from the 25th-percentile family will spend two years at community college and two years at a public university while living with Mom and Dad, for example (the richest kid will spend four years at a private college).
But more important, those are only possibilities, not reality, as the report notes. When reality strikes in the form of an emergency, the middle-class lifestyle can disappear:
"Families without employer-provided insurance may face much larger out- of-pocket medical expenses. Families in rural areas may face much greater car and transportation costs. Families in high-cost housing areas may be unable to afford a three-bedroom house (or any house.) Many families may find that their college or retirement savings disappear in a year when they face unexpected expenses. While our hypothetical budgets show that some families can attain a middle class lifestyle at quite different income levels, the assumptions necessary to make these family budgets balance also suggest that many families will find this difficult."
Indeed, the median family can only afford a home worth $231,000, and the 25th-percentile family can only afford a $144,000 home. That means if you live in a remotely expensive area, being middle class gets way more difficult, the White House found in a related report.
The budget is even tighter for one-parent families, a category whose numbers have swelled in recent decades — the report says it "may be possible" for those families to live in the middle class if they have cheap housing. But it adds an even more cautionary note: "Any sort of emergency, from unemployment to illness to unexpected home or car repairs, will make these budgets difficult, if not impossible."
This all gives us a hint as to why the middle class spans such a large share of people in surveys like these — it seems to encompass both people who want the trappings of a middle-class lifestyle and those who actually achieve it.
So these sorts of statistics should give everyone pause. Incidentally, that 2010 report came just shy of acknowledging something very important about all this: "Indeed, being middle class may be as much about setting goals and working to achieve them as it is about their attainment," the authors wrote. As it stands now, being "middle class" in America is, for many people, about having goals they can't achieve.