That's Rich
Ezra complains that $200,000 a year in gross income is not middle class:
[…] the fact that even a family making $200,000 can’t live a lifestyle free from all prudence does not make them middle class. Rather, it’s just a reflection of the extraordinary wealth that’s concentrated into a few hands in this country, and the degree to which inequality has mixed with economic segregation to produce a wildly skewed vision of what constitutes the economic norm. One has to wonder, though, how a media that thinks $200,000 is “middle class” could possibly do a serious job of reporting on a country where the median household income is around $60,000.
But the same basic criticism — that 200K is ‘rich’ — fosters a different line of argument, too, namely, that rich ain’t what it used to be. I’ll begin with the cheeky but effective argument that a gross income of $200,000 is particularly not what it used to be after a run in with the 50% tax bracket. But the main point I’d like to raise is that ‘extraordinary wealth’ as Ezra defines it has become more necessary for increasing, not decreasing, numbers of Americans who want their children to succeed in the nationwide (indeed global) competition for jobs and resources. A family that wants to have four children, have them well-educated, and have them raised by a stay-at-home parent does not have to be imprudent to fail to do this with $200,000 gross — especially if the single breadwinner in the household has just started making that kind of money, and still has a large amount of debt from the many years in which he or she struggled to become successful.
A major culprit here appears, to me, to be our educational system. College and law school are now places where the cost of a premium education is basically pegged to earning power of a student that immediately enlists in the officer class of the corporate corps upon graduation. Not all top-shop schools are sitting on vast endowments, though many are. Yet what will inspire legions of America’s best-socialized to work rotten jobs for great compensation, if not a debt burden that makes that compensation necessary to maintain their social class — to say nothing of remaining solvent?
The United States is trying all but consciously to create a society in which there are no elites who are not ‘rich’, and in which a maximum number of the ‘rich’ carry a maximum amount of debt. One of the best ways to achieve this fugly situation is to push all four of incomes, consumer spending, credit, and taxation into the red zone. I see where Ezra is coming from, and where he suspects we have to begin to break the cycle of perversity that blights the American political economy, but I’m convinced that the only way we can do it is to allow people to amass enough wealth to emancipate themselves from the debt regime that makes us the kept pets of an unsustainable and frivolous financial scheme. And that in turn requires that we not soak ‘the rich’. It also requires that we trust people who keep the money they make not to blow it on disposable luxury goods. The moral weight of what I’m arguing now shifts into view.
James, I’ll agree that $200,000 per year income doesn’t make one rich, particularly if they are supporting a big family with that income, but $200,000 per year puts one in the top 3 or 4 percent (ballpark) of annual income in this country. It’s hard to say that someone who is making more than 97% of his fellow citizens is a middle-class person. Unfortunately, we don’t have any good terminology to adequately describe the vast difference between the prosperous professional upper middle class and the truly rich. The gap in incomes between, say, the top 0.5% and the top 1% are probably bigger percentagewise than the gaps between the middle quintiles of income (which is where most people live).
— Mark in Houston · Apr 19, 02:22 AM · #
I agree that ed. costs and firm/corp. salaries are pegged to one another. Tuition pushes up salary just as much as salary pulls up tuition. If the firm doesn’t offer enough to service my debt, raise my (so-far) two little girls, and provide some reward for a decade of book hitting, well, I’ll look elsewhere.
I blame federal loans, a quick and easy path toward penury. Increasing access for those on the margins raises the cost for everyone (see also sub-prime mtgs.), and not everyone wins in this tournament. In fact, there are more losers than there were before, because positions with high salaries don’t correlate with the number of people in school. But decreasing access isn’t going to happen. What can be done?
I wouldn’t have gone to law school if federal loans weren’t available; I would have stayed in engineering, where the pressure to spend a six-figure salary on myself didn’t exist.
— Minnesota 2L · Apr 19, 06:46 PM · #