
$250K a Year Is Not Middle Class - applecore
https://www.nytimes.com/2015/12/28/opinion/campaign-stops/250000-a-year-is-not-middle-class.html
======
dragonwriter
Middle class is not principally about income, its about the method by which
you participate in the economy. If your primary means of support is applying
_your_ labor to _your_ capital, you are middle class (yeoman farmers,
independent small business owners, professionals that own or are full partners
in their practices, etc.)

If you primarily live by renting your labor to be applied to someone else's
capital, you are working class.

If you primarily live off your own capital, with most of the labor applied to
it being labor you rent from others, you are in the capitalist class.

Income _correlates_ with economic class, but neither strictly determines the
other. $250K a year is not middle class in the same way that, say, wearing a
bowtie is not middle class.

Its possible to be in _any_ (of the three mentioned) economic class and have
$250K/year income.

~~~
maxerickson
This definition is probably more useful than the popular one, but I don't
think it is what most people understand middle class to mean.

------
hcurtiss
As a family just inside that 5% mark, my first reaction is to object to the
idea that I'm somehow part of a wealthy elite. However, my second reaction is
shock that the median household income is $53,000. If you've got a couple kids
in Portland, Oregon and you're making $53,000, you're going to have a bad day.
I guess I'm left with a feeling of doom that I'm going to be asked to support
so many people when I feel like I have so little margin. We're investing in
our retirement, investing in our kids' 529, and paying down debts. With a home
loan and student debt, we're worth considerably less than zero. I've never
been overseas, and I mostly vacation in state. If I'm the mule that's supposed
to carry this load, I fear we're all going to have a bad day.

~~~
omonra
The author is being disingenuous with numbers. He's talking about 'household
income' \- when a large percent of households comprising of one person.

[http://blogs.wsj.com/numbers/one-in-four-american-
households...](http://blogs.wsj.com/numbers/one-in-four-american-households-
is-one-person-living-alone-1696/)

"The proportion of one-person households increased by 10 percentage points
between 1970 and 2012, from 17 percent to 27 percent."

------
hardcandy
I wouldn't expect it from politicians, but am surprised how even experienced
writers on this topic can't seem to understand the real factors at work here
and contribute to an objective conversation about income, wealth, and class in
America circa 2015...

If my wife and I work 80 hours/week for an energy company that is highly
cyclical, we are very different than two physicians who work 80 hours a week
but have lots of job security, who are in turn very different from a retired
police captain who collects $250k from two spiked Government pensions, who
himself is very different from a retiree who lives on $250k in dividend income
from a $10 million dollar portfolio of index funds. Not to mention who owns
their own home (inherited perhaps), and who doesn't. It's almost like ''income
is the worst way we have to measure relative prosperity, except for all the
others''.

~~~
Pxtl
Not to mention the difference in cost of living in various places.

~~~
pdex
Tell me about it. $250k in Manhattan doesn't stretch very far.

~~~
dogma1138
At some point you need to realize that the middle class is also geographically
gated. There's a reason why the classical middle class picture is a nuclear
family in the burbs and not on 5th avenue. The American middle class was never
"rich" it was very financially prudent. If you still willing to live in the
burbs 250K in NYC will get you a very nice house, a car and even college
tuition for your kids. Even in the golden age of the American middle class
there were plenty of areas that were out of their reach, thats why the middle
class expanded into new sub-urban developments. The cities were mostly
polarized as they housed both the very rich and the very poor.

~~~
pdex
I agree with you but the NYC tri-state area is a strange place and not a great
example for the stratification effect. You're worse off in the NYC burbs in in
many cases, one would think it would be the opposite but it's not. The amount
of money it takes to break out of the middle class quality of life is more
around 400k per year for the NYC tri-state area. In the burbs the houses are
not nice or good for the price, they're overpriced and property taxes are
outrageous- property taxes can actually be worse in the suburbs than they are
for a Manhattan condo or coop. The commute is also a killer, while Metro North
is somewhat reliable and on-time relative to other rail systems, the length of
the commute is just brutal. At least while you're paying more per square foot
in NYC you do get some convenience out of it, although this gets more
complicated if you have kids. If you've got to worry about education for
children, you MUST buy a coop/condo in a NYC district with good zoned schools,
this isn't common and those district command the highest prices per square
foot. If you can't afford those districts your looking at private school for
the kids, and that runs 30-40k, somewhat less if you choose a Catholic school
but still a huge chunk of your budget. Trust me, there are places you don't
want your kids going to public school- and I'm not talking safety, this is in
regards to the piss-poor quality of the education. You'd be better off home
schooling in some places. The burbs do have better schools overall, but you're
still stuck living a middle class lifestyle with a soul-sucking commute in the
NYC burbs on 250k.

------
13of40
"Middle class" doesn't have to be precise or correct, because it's not a
mathematical term. When a politician uses that term, they're doing it because
they know that the guy making $20K (who doesn't want to identify with
poverty), and the guy making $300K (who still feels a sting when he needs to
buy a roof for his McMansion), and everyone in between considers themselves
middle class. Hillary Clinton is just saying "I won't raise taxes for you,
Friend."

------
ipozgaj
$250k is not the same in, for example, California and Iowa. If your family
income is $250k in cities like San Francisco or New York, that definitely
doesn't put you in 95-percentile.

~~~
evanpw
True in San Francisco, but even in NYC $250k is 95th percentile:
[http://www.businessinsider.com/san-franciscos-top-5-of-
earne...](http://www.businessinsider.com/san-franciscos-top-5-of-earners-are-
insanely-rich-2015-3).

~~~
harryh
San Francisco incomes statistics are undoubtedly skewed by stock option cash-
outs that are one time (or at least relatively rare) events. So if you have a
250k/yr salary you might not be in the top 5% for any given year, but I bet
you're in the top 5% for, say, any given 5 year period.

~~~
tedmiston
Not to mention that the top 5% by salary have other forms of compensation not
included in the analysis, like stock options.

------
tsunamifury
I make 370k per year and live in a 500 sqft studio in with my gf (who makes
120 of that). We have student loans, a little credit card debt and so on. We
likely can never buy a house in Berkely and really are thinking hard if we can
afford one kid.

We rent our time just like anyone else and eventually our time will be worth
less. But right now we are taxed heavily to be middle class.

No, it's that 53k a year is near poverty but no one wants to tell America that
the majority of its citizens are so badly compensated for their time.

Median income =/= middle class

~~~
ac29
You are literally the 1%, even in the Bay Area. Either you're lying, have way
more debt than you are letting on, are planning on retiring after a few years
of work, or have a fundamental disconnect from reality.

You should be netting 200k or so a year, and even a fairly lavish lifestyle
should let you save 100k a year, given that you have no kids and live in a
place that should cost less than 10% of your net income.

I've lived in the Bay Area for several decades, and I could buy a very nice
house tomorrow if I made 370k this year, even starting from flat broke.

~~~
tedmiston
It's confusing that he listed $370k as _his_ salary (really, combined salary)
followed by saying $120k of it is his partner's.

I don't know the percentile, but $250k in SF is not even top 5% per an article
someone else shared in comments. [0]

0: [http://www.businessinsider.com/san-franciscos-top-5-of-
earne...](http://www.businessinsider.com/san-franciscos-top-5-of-earners-are-
insanely-rich-2015-3)

------
evanpw
We should banish the term "class" when discussing tax rates. It's got too much
connotational baggage. Even if someone making $250k considers themselves
"middle class", unless they lack all perspective, they don't consider
themselves "middle income".

------
dogma1138
The 250K is a very well selected figure from a political stand point as it
incorporates most of their current voting base and any one who's on the fence.
Families with income of 50K and below are more likely to identify as Democrat
in the current political climate, 50-150 is more or less evenly split and the
higher you go the more ground the democrats usually lose.

Over 250K it most likely won't matter as their political opinions might not be
swain but 150-250K is quite a lucrative poaching ground for both parties, the
republicans spread fear that those are the people who'll suffer the most under
the Dem's taxation policy and the Dem's advertise that they are part of their
precious middle class that must be protected.

The 150-250K range is also where quite a few of the Dem's force multipliers
lie; young educated professionals which are tethered to social media and are
quite likely to be politically active on various social issues attacking and
preserving them is quite paramount for the Dem's long term strategy if they
want to keep the white house for another 8 years.

------
Swizec
The real problem is talking about absolute values. $250k/year makes you king
in many places, but in several cities you'll be hard-pressed to buy a house or
even an apartment.

Owning your home has long been the staple of middle class. In places like San
Francisco even the very high income engineers mostly pay rent. Especially the
ones in their 20's.

(source: me and my girlfriend put together make just over $200k/year, we
wouldn't dare think of buying a place, probably ever. According to the article
we're top 96th percentile)

------
harryh
ITT a bunch of yuppies that live in a bubble and whine that even though they
travel on an airplane for several trips every year, and go to nice restaurants
all the time, just because they might not be able to afford their dream house
in one of the most expensive places to live in the country they aren't rich
damn it. It's _other_ people who are rich.

Living in San Francisco is a luxury good.

Buying a house in San Francisco is one of the most expensive luxury goods
there is.

~~~
gk1
At time of writing most of the posts are about defining the term "middle
class." Don't know if you're projecting or just overly eager to accuse others
of being a "bunch of yuppies in a bubble."

~~~
harryh
Any definition of "middle class" that extends to the top 5% is stretching the
term so far as to be silly. And it gets stretched that far because some people
are unwilling to face the fact that they're rich and accept some of the
responsibility that comes with that.

------
nickysielicki
I think we have a problem in the US where we think the success that we've had
since WWII was something other than an anomaly. For some reason we think that
this comfortable model, where if you work hard and follow the rules and go
through the motions put in front of you, that you can live a comfortable life
with a white picket fence, a couple children, and with one of the parents at
home with the kids.

It doesn't work like that in most of the world. In spite of how interconnected
we've become, we're still largely blind to the terrible conditions of hard
working people who follow the rules in the rest of the world.

So now you're seeing a lot of people upset that they're following the rules
and ending up in bad places-- in a lot of student debt, or unable to find
jobs, or unable to find well-paying jobs. They look at their parents and
grandparents and think that it must be some small systemic problem-- the 1%
isn't taxed enough, or even worse, they think that it's _not_ some systemic
problem, and that this is just a result of the 2008 economic downturn.

I think the problem is a bit worse than that. I think we're on the tail end of
our post-war powerup. I think we're going to try to tax our way out of it and
end up with a broken country. I think we need to face some hard truths and be
a bit more concerned about our national debt; a lot of people on either side
don't seem to realize that a devalued dollar only hurts people that hold
dollars-- you know, lower and middle class Americans. The Trumps of the world
hold capital and couldn't care less about an inflated dollar.

If you click my comment history you'll see that I'm a jaded man that speaks a
lot of doom and gloom, so who knows. I'm just not comfortable simplifying this
as much as the article does. America can't stay on top of the world forever.

~~~
harryh
The first 3 graphs of your comment in chart form:

[https://twitter.com/BrankoMilan/status/668196138332327936](https://twitter.com/BrankoMilan/status/668196138332327936)

------
the-dude
Well, middle class used to mean the family lived on one income, the mother
stayed home/kids/charity, the house in the suburbs was owned and you would
have a car.

Would $55k get you this today? I don't think so. Would $250k get you this
today? Maybe.

edit: typo

~~~
ChuckMcM
There aren't a lot of places where you _can 't_ live on an annual gross income
of 250K. The quality of life will vary, if you living in New Jersey for
example and commuting over to Manhattan, or out in Livermore taking the train
into San Jose or Oakland. You would be doing just fine in Portland and much of
Seattle. Places like Albuquerque and Des Moines would have you really living
well.

But looking at it a different way, where is the money going in those various
locales? Given the cost of living in the Bay Area compared to the Columbus
metro area, the amount of 'pay dollars' is generally flowing out at a much
higher rate in the Bay Area, but they are soaked up just as quickly as they
are in Columbus. So who is getting them? Banks with their Mortgages? Schools?
Government? Restaurants? How can you have a population of people making $200K
a year in one place experiencing the same level of "wealth" as people making
$100K a year in another place? That makes for an interesting conversation.

~~~
the-dude
While this certainly might be interesting today, you glossed over the fact
that middle class was earned by a single income in earlier days.

Which I think is far more interesting.

~~~
rubyfan
It'd be interesting to see when this balance tipped on a timeline.

There's a lot of factors at play here. I can imagine a time where not everyone
in the middle class had an expectation of going to college. I could also
imagine a US advantage on skilled labor that would have yielded far better
wages which has steadily eroded under globalization. I am also imagining a
time when taxes where less burdensome. Probably some other factors at play
that I am overlooking as well, still I wonder when the tipping point was
1980s?

------
aggieben
I'm a bit astonished that it doesn't seem to be pointed out in these comments
(and even a bit more astonished that it's not mentioned in the OP) that there
are a great many people whose income tax returns will say $250k+, but they are
paying taxes on a small business and may not be realizing anywhere near that
much gross income personally.

~~~
encoderer
If I own half of a small business that made $500k in profits, you're right
that I will show $250k of partnership income on my tax form. But whether I
take it as salary or not is moot. You only pay taxes on business profits, so
that wealth exists somewhere and 50% of it is mine.

~~~
hardcandy
I think aggieben might have been referring to FICA, medicare, and all the
other little taxes that small business owners get nickled and dimed with.

~~~
aggieben
Yes, that, and it also depends on what state taxes on business look like, and
you would also pay taxes on any of it that you put back into the business.

The point is just that there are many people with arrangements such that they
might have to file on $250k+, but never realize that as personal income.

~~~
encoderer
Every state that has personal income tax taxes llcs the same as the irs. I
think you've bought into this canard that business owners are regularly paying
taxes out of pocket and it can certainly happen but it's not common. And
that's why the article didn't mention it.

~~~
hardcandy
There are other taxes and fees that add up. The State of California levies an
$800 annual tax on every LLC doing business in the state, for example.

~~~
encoderer
But that doesn't show up on your tax return. The commenter I replied to has
repeated a common trope that there are small business owners who would be hurt
by considering $250k as wealthy because of a quirk in our tax code (pass thru
taxation). It's a canard because if you own half of a business making $500k in
profit nobody should be worried about your tax bill. Income or not, you own a
profitable business that is worth a lot of money. And he suggested that you
pay taxes on money you invest back into the business which is not true. You
pay taxes on your profits not your revenue.

------
s_q_b
The biggest problem is that 250k a year is _is barely_ middle class in a large
city.

If you have three children, and 250k income, that will provide you a decent
living, maaaybe allow you to purchase a home, and just barely afford college
funds. That's what's broken.

~~~
astrange
That's only in San Francisco and other rich neighborhoods. Even in NYC and LA,
250k is more than any family you know makes.

~~~
encoderer
NYC real estate is more expensive per sqft than San Francisco.

> Even in NYC and LA, 250k is more than any family you know makes

What on earth does this even mean? If you have 2 professional incomes in a
family in any of the cities you mentioned, you're at $250k.

~~~
astrange
Well, I only aim to be 90% right.

------
trav4225
Hah, when I first read the headline, I thought the theory put forth was going
to be that $250,000 is below middle class. :)

------
minikomi
As someone living in Tokyo, Japan.. These numbers are all kind of mind
boggling. And not in a good way.

------
n00b101
It sure feels middle class...

