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Comment by kevmo | Hacker News Reader

The upper class is destroying the middle class.

The US middle class is disappearing…into the upper middle class.

https://www.aei.org/economics/the-us-middle-class-is-disappe...

The AEI doesn't mention it, but a large part of the middle -> upper middle shift is increasing participation in the labor force by women[1]. Which is a good thing! But it doesn't support the claim that the US, as a whole, is moving middle class families into the upper middle class through positive socioeconomic shifts. It merely demonstrates that more labor means more paychecks.

[1]: https://fred.stlouisfed.org/series/LNS11300002

Is two income households truly a good thing?

A different perspective is that two income households enabled housing costs to rise, rents to rise. And causes the cost of having a child increase due to childcare costs.

Overall maybe society is better having 1 parent (male or female) stay at home to raise the children. Or re think our North American living situation ideals of 1 family per house.

I think it is, at least from the perspective of human autonomy: independent income sources means freer choices among peoples. However, that opinion of mine is immaterial to this conversation.

But the women were working before, they were just labouring inside the home. Society is realising that having all the women become domestic workers by default is a massive misallocation of resources and correcting course. That is a positive socioeconomic shift.

Yep, that's why I tried to distinguish between "workforce participation" and "labor." Women have always labored; they just haven't been paid for it historically.

And it is indeed a positive socioeconomic shift. But it isn't the kind that the AEI means to imply: they're a neoconservative foundation that's attempting to post-hoc justify deregulation and de-clawing of federal agencies under false premises.

All of that domestic work is being done, in addition to having two full time jobs outside the home. With roughly the same standard of living.

Hard to say that's an unalloyed positive.

This is an excellent point that I hadn't thought to make.

Is it? Or is it an artifact of how economic measures are unable to capture important socioeconomic factors? Perhaps the only misallocation is the assumption that women were domestic workers and domestic workers were women.

That is the misallocation I am referring to. Some women should be theoretical physicists and some men should be domestic workers. The unrealised gains must have been enormous.

Your chart shows that workforce participation by women was already high.

And this chart is skewed by the underlying baby boomer generation which made up a bigger percent of the population (which is why you see the downward trend recently - they retired).

If a man was making a real income of $95k in 1980, and was then knocked down to $55k, so his wife raises their 1 kid (as the example given), goes back to work and makes $100k - they have moved from middle class to upper middle class.

Interesting these charts start in 1980 as well. The average real hourly wage went down from 1972 to 1980, then began a recovery. So when you don't show things were better beforehand, it looks like a constant rise, which it was not.

I had figured since it was the AEI the figures would be intended to mislead.

Not sure I understand your comment as presumably people were staying home with their kid throughout that period?

And the entry of women in the workforce happened in the 1970’s. The start date of 1980 might be arbitrary, but you seem to ignore the trend being pointed out.

While that is true to an extent, it drops some very important context.

What happened / is happening, is white and asian middle class households have continued to climb into the higher economic tiers over the last 40-50 years. In their place, hispanic households that have rapidly expanded in numbers in the US since the late 1970s are taking over an ever larger share of the middle class demographic.

When people claim the middle class has seen no economic gains in the last 40-50 years, they're either lying or painfully ignorant of what's actually occurring: a dramatic and rapid demographic shift. It takes a mere few minutes to dig up the relevant economic data and see how the middle class of ~1980 was nearly entirely white, and many of those formerly middle class whites have now shifted upward in the economic tiers (which you can spot today by looking at the median or average white household net worth vs the national median or average).

So what some of that middle class disappearing into the upper classes represents is an ongoing bifurcation by race among the classes. The US middle class will soon be overwhelmingly hispanic, in other words. That's tremendous progress in a sense, given the people it represents often came from third world countries with nothing to their names and speaking little to no English. Will they see continued progress or will their position ossify there? That's the next issue for the new, vast US hispanic middle class for the coming decades.

And what about black households over that time? They're being left behind by hispanic household net worth growth and are not seeing nearly the same progress in moving into the middle class. That is going to cause significant political ramifications as hispanic political power in the US continues to expand.

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