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Pew Research Report Finds Most Americans Are No Longer Middle Class

Dec 10, 2015
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AUDIE CORNISH, HOST:

The middle class no longer represents America's majority. That's according to a report from the Pew Research Center. Rakesh Kochhar is the report's lead author, and we welcome him to the program now. Hey there, Rakesh.

RAKESH KOCHHAR: Hello. Thank you for having me.

CORNISH: So we're saying that the middle class no longer represents the majority. Give us some context here. Who are we talking about? What are the parameters?

KOCHHAR: Our definition is based on income. So if you live in a household whose income is two-thirds to double the national median income, we say that you are in a middle-income households.

CORNISH: And so right now in America, if you have a family of three and your households making between 42,000 and 126,000 a year, you're middle-class.

KOCHHAR: Right.

CORNISH: In the '70s, 60 percent of Americans fit that description, and now that's shrunk to 50 percent. You call this a demographic shift that could signal a tipping point. So what would we be tipping toward here?

KOCHHAR: Right. So if we have fewer people in the middle, the question is, where are they moving to? And we find they're moved both to the low end of the income distribution and to the high end of the income distribution. But when we take a deeper look within the lower end, we find that they are moving to the lowest end of the income distribution. And then when we take a deeper look at the upper end, we find that they're moving to the very top end of the income distribution. So the movement out of the middle is not just to the margins but to the farthest edges of the income distribution. In other words, there's a deeper polarization underway in the American economy.

CORNISH: But does this mean that more people are experiencing success?

KOCHHAR: Yes. Some indeed are, and specifically people who have experienced greater gains include older adults, people 65 and older, people who are married and people who have a college education.

CORNISH: For people who are older, what is a reason that they've gained ground?

KOCHHAR: Early in the 1970s, improvements in government benefits, especially Social Security and Medicare, pushed the poverty rate down dramatically among older adults. And over time, more and more older adults are spending time in the labor force in what used to be traditional retirement years. But keep in mind that they still remain more likely to be lower income than adults overall.

CORNISH: Rakesh Kochhar is associate director of research at the Pew Research Center. Thank you so much for talking with us.

KOCHHAR: Oh, you're welcome.

CORNISH: The middle class has always been a potent symbol in American politics. And to talk more about what these numbers mean, we turn to Mara Liasson, NPR's national political correspondent. Hey there, Mara.

MARA LIASSON, BYLINE: Hi. Audie.

CORNISH: So candidates on all sides always vow to strengthen the middle class. So let's talk about this - right? - the fact that it's shrinking. Why is this dynamic so important in an election year?

LIASSON: Well, the middle-class squeeze, the fact that it's gotten harder to stay in the middle class or get into the middle class, is really the most important dynamic in this year's election. And middle-class incomes are about the same as in 1989. And voters are looking for someone who can provide an answer to the question, how can I maintain a middle-class lifestyle and make sure that my kids do better than me? And both parties have been having a hard time coming up with a compelling answer that question.

CORNISH: But looking at the demographics here, which party should be paying closest attention?

LIASSON: Well, I think both parties have to pay attention to this, but it is true that the Republican Party proportionally now has more non-college-educated voters, a greater proportion of white working-class voters. And they have spent - the Republicans have spent 50 years attracting these voters. They've had a compelling message for them, whether it was social issues or a rejection of the cultural elites. They haven't come up with an economic program for them, and I think that's one of reason that so many of those voters are gravitating to Donald Trump.

CORNISH: OK, so looking forward, how should we think about this?

LIASSON: When you have a prolonged period of middle-class income stagnation, which we have had, and a prolonged period of gridlock in Washington where politicians can't do anything about middle-class incomes, you get political volatility. And that's why you've seen, since 2000, all the elections we've had, with the exception of 2012, have been change elections. That means one house of Congress or both or the White House have - has changed party control. Voters keep on voting for change, but they never get the change they want.

CORNISH: That's NPR national political correspondent Mara Liasson. Mara, thanks so much.

LIASSON: Thank you. Transcript provided by NPR, Copyright NPR.