What is Middle Class in 2010?

I was listening to The Takeaway on a local NPR station today, and they were having an interesting discussion of what constitutes the middle class.  The callers were mostly those who considered themselves members of the middle class.  They defined themselves as middle class for a variety of reasons — mostly income and possessions.  But the discussion got me to thinking about how lower-income Americans define being middle class.  I think this important because being middle class is the American dream. Low income families want the white picket fence outside of the home they own.  They want the two car garage with two cars inside.  They want the suburban dream. Right?  Or, is that what I – the middle class young professional daughter of two middle class parents – think they want?     Maybe their view of middle class is different?

I don’t know if their view of what constitutes being middle class is different.   I don’t even really know how to concretely define what middle class is in 2010, so I thought I would try to find out what you think. 

What do you think being middle class means?  Is it defined by possessions or income level or the type of job you have or something else? 

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Fighting the Good Fight

I am sure you have all seen the poverty data released by the US Census Bureau last week.  While the median household income did not change in 2009, the poverty rate rose from 13.2% to 14.3%.  This represents the second statistically significant increase since 2004.  This rate is also at its highest since 1991, but it is still 8 percentage points below the highest poverty rate on record.  The number of people in poverty is at an all time high.  All of this really means one thing, the poverty crisis in America is getting worse.  But, what can be done to fight poverty? 

Here at Community Action Project of Tulsa County (CAP), we believe in an intergenerational approach to fighting poverty.  This means CAP serves both children and parents.  We serve children through Head Start, Early Head Start, and the State Pilot Program at 13 sites across Tulsa County.  While in one of CAP’s Early Childhood Education programs children develop the emotional, cognitive, physical and social skills that will serve them throughout their lives.  Through a partnership with Family and Children Services (F&CS), each family in our early childhood program also has what we call a Family Support Specialist.  F&CS provides family support, parent education, case management, crisis intervention, and family counseling services to families.  All of these services are aimed at making sure kids are prepared to be successful students when they enter kindergarten.

CAP also offers a myriad of services to the parents of children in our early childhood education programs.  Two programs that faithful readers of the blog are already aware of are Healthy Women, Healthy Futures and CareerAdvance.  Healthy Women, Healthy Futures works with mothers to make sure they are as healthy as possible before becoming pregnant because the more healthy the mom, the more likely a child will be born healthy.  CareerAdvance provides parents training in the nurse career pathway and also job readiness skills in hopes of parents obtaining employment that provides a family sustaining wage.  In addition to these programs CAP also supports families who are taking GED and ESL classes through our Adult Learning Initiative.  These programs in addition to programs such as free tax preparation and our First Time Homebuyer program offered through our Financial Services division are meant to strengthen the families and households that influence children away from school. 

We hope that by supporting the development of children and helping connect adults with the skills and services they need, we can help families end the cycle of intergenerational poverty.

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Are the Rich Really Getting Richer?

According to a series of articles by Timothy Noah posted on Slate.com, yes, the rich really are getting richer.  In the series, titled “The Great Divergence: What is causing America’s growing income inequality?“, Noah explores why the top 1% of earners’ incomes are increasing while the income of the other 99% are not.  In the series he has or will look at race, gender, education, trade, immigration, the fall of organized labor, and political parties as possible reasons for the shift (there are still a few new pieces left before the series is concluded).   I recommend the articles to anyone with an interest in income inequality in the US, but if you don’t have time to read the entire series, the accompanying slide show by Visualizing Economics  is a great way to get an overview. 

Figure One: Income Share Over Time

Source: Thomas Piketty and Emmanuel Saez.
Chart by Catherine Mulbrandon of VisualizingEconomics.com.

 

Figure One lays out the two trends in income inequality over the past 60 years.  The first occurred from 1940 to 1979 and is was termed the Great Convergence by economists because the income gap shrunk.  In 1979, that trend began to reverse though, giving way to the Great Divergence.  Since 1979, the income gap has widened significantly. 

 

Figure Two: Income Share Ratios

 

  Sources: Congressional Budget Office, Census Bureau.
Chart by Catherine Mulbrandon of VisualizingEconomics.com.

 

Figure Two shows how the bottom 20% and middle 20% compare to the top 20%.  The top line shows that the income gap between the richest and the poorest Americans has nearly doubled since 1979, while the gap between middle class and the richest Americans has widened only slightly.  The author attributes this to the increasing importance of a college degree in the current job marketplace.  In other words, those with college degrees (upper and middle-income Americans) have higher incomes that those without a college degree.

From my perspective this kind of information further emphasizes the need for more and better education, job training, and jobs to fight poverty in the US. 

    

The read Timothy Noah’s series on the Great Divergence, click here.

      

To view Visualizing Economics’ entire slide show, click here. 

    

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2010 Oklahoma Ballot Measures

The Oklahoma Policy Institute has posted some great information about the 11 (yes, 11!) state questions that will be put to Oklahoma voters on the November ballot.  The information includes full text of the state questions, editorials, opinion pieces, media stories, and when available the websites of pro and con groups.

To check out the Oklahoma Policy Institute’s November ballot measures page, click here.

Thank you Oklahoma Policy Institute for helping us become more informed voters!

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Location, Location, Location!

Location, location, location is a familiar phrase when thinking of real estate, but it is also an important factor in determining the affordability of housing.  The Center for Neighborhood Technology (CNT) has added the cost of transportation to the cost of housing to find what they consider the “true” cost of housing.  In their Housing and Transportation Affordability Index, CNT has combined the average cost of housing in an area with the average cost of transportation in that same area to provide a more complete look at affordability.  Below are two maps that show how the cost of transportation affects affordability in Tulsa County.  Keep in mind that affordable housing is generally considered housing that costs no more than 30% of household income.  When CNT added transportation to the equation, they calculated that affordable transportation should be no more than 15% of household income.  So, housing and transportation costs should be no more than 45% of household income.

  Figure One: Housing Cost as a Percentage of Household Income in the Tulsa Area

In Figure One, the blue color represents 30% or more of household income and yellow represents less than 30% of household income.

Figure Two: Housing and Transportation Costs as a Percentage of Household Income in the Tulsa Area

 

In Figure Two, the blue color represents 45% or more of household income and the yellow represents less than 45% of household income.

In another attempt to increase comments, what do you think the implications of this type of data might be?  Will it affect how you think of affordable housing?

For more information on the Center for Neighborhood Technology, click here.

For more information on CNT’s Housing and Transportation Affordability Index, click here.

To look at the images above in more detail, click here.

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What is a Self Sufficient Wage in Oklahoma?

Yesterday, I was reminded that just because an individual or family is living above the federal poverty level does not mean they are not in need of services.  While at the Oklahoma Asset Building Coalition’s Regional Meeting in Broken Arrow, I was introduced to the Self-Sufficiency Standard (the Standard), which is considered by some to be an alternative to the federal poverty level.  The Standard was published in both 2002 and 2009 by Wider Opportunities for Women in partnership with the Oklahoma Asset Building Coalition, the Oklahoma Association of Community Action Agencies, and the Oklahoma Department of Commerce.  The Standard is the amount of income families ned to meet their basic necessities without public or private assistance.  These basic needs are based on the actual cost of housing, food, child care, health care, transportation, taxes, and miscellaneous.  The final report includes data for a single adult and  seven types of families.  When creating the Standard, it was assumed that:

• All adults work full-time with corresponding work-related expenses
• Employer provides employee and dependents’ health insurance with average premiums and out-of-pocket expenses
• No family members with special needs
• No frills budget (no meals out, entertainment, and the like)
• No one-time purchases (furniture, cars, presents, appliances, etc.)
• No savings or loan payments

This table shows the hourly, monthly, and annual self-sufficiency wage for the seven different family types if they lived in Tulsa County including the City of Tulsa and suburbs.

	Adult + Preschooler	Adult + Infant + Preschooler	Adult + Preschooler + School Age	Adult + School Age + Teenager	Adult + Infant + Preschooler + School Age	2 Adults + Infant + Preschooler	2 Adults + Preschooler + School Age
Hr	$16.54	$21.63	$18.93	$13.85	$26.55	$12.39 adult	$11.10 adult
Mo	$2911	$3807	$3332	$2438	$4672	$4360	$3906
Yr	$34933	$45679	$39978	$29254	$56063	$52326	$46868

In the reports linked below, you can view the SSS for different part of Oklahoma.  You can also read more about how to use the Standard.  In the 2009 Standard you can also see how the federal poverty level and the Standard differ for different types of families. 

To view the Self-Sufficiency Standard for 2002, click here.

To view the Self-Sufficiency Standard for 2009, click here. 

To read the Oklahoma Policy Institute’s Blog about the Self-Sufficiency Standard, click here.

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