US middle class loses the middle

Middle class is often called the society’s backbone. They say it is the main producer of goods. Ideally, it is economically free people who at the same time save and earn much. Under this definition, there’s practically no middle class in the States.

American families with annual income of US$40,000-90,000 which normally think of themselves as a middle class are not satisfied with their life standard. This means they depend on credits, salary, save on toothpaste, icecream, movies and long-distance calls. There is no classical middle class in the US, it’s a myth. This is opinion of National center for public opinion studies of Chicago University. And not only theirs.

Sociologists divide American population into five groups of approximately equal number (20% each). The first is families (2 parents and 2 kids) with annual income below 24 thousand dollars. The second has income from 24 to 40 thousand. The third earn from 40 up to 95 thousand. The fourth enjoys 95-165 thousand, and the fifth earns more than 165,000 american dollars a year. There is yet another “subcategory” of “richest Americans” who earn above 900,000 but it is only 1% of the society.

Middle class is often called the society’s backbone. They say it is the main producer of goods. Ideally, it is economically free people who at the same time save and earn much. Under this definition, there’s practically no middle class in the States. As opinion polls suggest, the first three groups count themselves slave of the family budget, and their earnings are just above the spendings. Even some part of the fourth group members agree. They simply don’t have funds to invest in new enterprise, in real estate or save in banks.

About 40% of their expenses is for accommodation (purchases, rent and insurance). Municipal payments (heat, gas, electricity, water etc) consist further 5%. Another 4.8% goes for furniture and house ware. Rent, insurance, repair and maintenance (gas, parts) of cars take 17.6%. Food and drinks (including alcohol) take 17%, medical expenses eat up 5%, house animals and leisure spending is 6%, education and telephony (including cellular) is same 6%. Little less than 5% is spent on clothing, shoes and jewelry. As a result, only 4% goes for “other spendings”

In practice, American middle class is rather a condition, a self-identification than a social status. It is counted that the first four groups (up to 165,000 dollars earnings) together amount for 45% of all earnings of US citizens. Rich and superrich get the rest 55%, but they supply as much as 90% tax incomes to the federal budget.

“I have always thought myself being a middle class, even though I might have fell out of it. But now I cant even afford a decent holiday, often late with bills and hence penalized”, comments Nicky Faldemolai from Bethesda, Maryland.

She used to work in a publishing house, earning $115,000. In July last year the company was restructured and she lost the place. Now she’s got her own business, which doesn’t yield that much.

It is significant that in 2001 an average annual income per family was $42,228 while in 2000 it amounted to $43,162. Slowly but inevitably an American family grows poor – that’s what sociologists say. They have to change states sometimes to where living is easier.

For instance, from Washington, New York, Los Angeles, San Francisco and San Diego people move to central parts: Utah, Colorado, New Mexico, Arkansas, Oklahoma, Nebraska. Cost of living here is much lower. Accommodation is about twice cheaper, medical expenses 27% lower, 20% less goes for transport, 7.5% less for food.

In these new places many Americans feel themselves a true middle class. “If in Washington you call up to a man who earns hundred grans a year saying “Hey buddy, you’re rich”, he’d be all rage”, warns Rick Edelman, financial adviser in FairFax, author of “Ordinary people, unordinary capitals” book. “In the capital this money isn’t enough neither for kids education, nor for pension savings.”