image_alt_text

Middle Class or First World Subsistence?

Mon, 11/07/2011 - 11:29am
Topics>

I must take issue with the assertion made in this article that a couple with 3 children making 50K combined is "solidly" anything, never mind middle class.

Let's run down the list of assumptions required to argue that 50K leaves a family of 5 with enough disposable income to be considered middle class vs. living a first world subsistence existence. This couple owns their home (or lives rent free), they have no debt in the form of student loans, car payments, credit cards etc., they have good employer subsidized health insurance and are all healthy and since both parents are working we have to assume that grandma is the work-day caregiver and she gets paid in love.

Even with these fairly outrageous assumptions, that 50K is more like 41K once you take out taxes. That's less than 185% of poverty level income for this family. They would easily qualify for reduced school lunches, subsidized housing and food stamps. That's middle class???

Let's look at this a different way, where we assume they have most of the liabilities most families have. They pay $1,200 a month for Housing (if they are lucky, in Chittenden County this would be very hard to do for a family of 5.), they pay $500 a month for 2 student loans, they pay $300 for health insurance, they have a car payment of $250, they pay car insurance of $100, and they pay $500 a month to have one kid in full time daycare. From the post taxes residual of 41,000 we get around $3400 a month. After just the above expenses (by no means a comprehensive list), this family has around $550 left to pay for everything else; food, utilities, car repairs, all the crap costs like parking tickets and broken teeth that come up and all the discretionary consumption that supposedly defines what middle class is.

Drop one of the student loans or the car loan and it's still insane to call their income situation anything but precarious and stressful. Even though they are both educated white collar professionals, it is Orwellian nonsense to call these people middle class.