Five Charts on the State of the Middle Class - Center for AMerican Progress

[Bill USA]

[King_Klonopin]

1. How did it get to this point ?

1) Keeping the minimum wage down. (It was about $5.00 in 1982, it's now $7.50)

2) Crushing labor unions by demonizing them and pitting worker against worker.

3) Using economic crises and unemployment to scare people into settling for
less pay, less benefits, horrible working conditions, etc.
Downsizing, outsourcing and pushing productivity of workers to levels that
are beyond reasonable.

4) Eliminating the voice of labor from political debate: Passing legislation that enables
wealth to inundate and corrupt our political process (Citizens United, lobbyists)

5) Impeding the ability to save money (accumulation of wealth) and replacing it with
lifelong debt by making the cost of living higher than income levels. Making two-
person income a must, not an option.

6) Eliminating the credit card debt provision from bankruptcy laws.

7) Creating financial "bubbles" that benefit the rich and totally screw the middle class
(stock market crashes, housing collapse)

8) Stealthily transforming a progressive tax system into a regressive system, making
the rich richer and the poor poorer.

All make a recipe for economic malaise.

[renko]

2. Subtract the 5- Mil 1%ers, the 'Median' income is closer to 30-40K...

I'd be. Anyone with those stats, please email them to me.

[caraher]

3. Try the Census Bureau

I don't think it would drop the median that much, but of course it would depend on how steep the slope is near the median value. The Census Bureau web site has the kind of data used for these charts, though I don't think they report enough information to calculate things the way you suggest.

Looking at the report under "Income, Poverty, and Health Insurance Coverage in the United States: 2010 (P60-239)," Table A-3, I'd guess you'd drop the median value by no more than $1000-$2000 or so. That's because trimming the top 1% means shifting the center down by a number of households equal to 0.5% of the total number, which means a shift of 5 * 0.5% = 2.5 % of the middle quintile, the center of which lies about $30k above the center of the second quintile. Of course, incomes will be clustered more toward the bottom, so the shift would be bigger than a linear interpolation would suggest, but it's hard to say by how much.