A New York Times article this week features data on the declining middle class in America, see: The American Middle Class no longer the world’s richest.
“The American middle class, long the most affluent in the world, has lost that distinction.
While the wealthiest Americans are outpacing many of their global peers, a New York Times analysis shows that across the lower- and middle-income tiers, citizens of other advanced countries have received considerably larger raises over the last three decades.
After-tax middle-class incomes in Canada — substantially behind in 2000 — now appear to be higher than in the United States. The poor in much of Europe earn more than poor Americans.”
Keep in mind that the definition of middle class in the US today is a family of 4 with household income of 40K a year. Canada has fared better over the past decade. But lest Canadians gloat, it is important to note that today its middle class is the most indebted in the world and hence particularly vulnerable to the next economic downturn when income and asset prices will fall, but debt burdens will persist. This clip offers a good discussion on the topic. Here is a direct video link.
Bill Maher also recently offered this characteristically irreverent yet astute summary of the new rules of America’s vanishing middle class (starts at 2:15 in the clip). See this direct video link.
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