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The Struggling Middle Class

- February 2, 2012

Mitt Romney’s focus is on “middle-income Americans” because “these are the people who’ve been most badly hurt during the Obama years”; they’re “the folks who are really struggling right now.”

Here is a rough test of Romney’s claim. Caveats follow the jump.

I’m interpreting “the Obama years” literally, comparing the most recent income figures with those from 2008, George W. Bush’s last year in office. I have argued elsewhere that new presidents should not be considered responsible for transition years, since their policies generally require some time to take effect.

The Census Bureau’s most recent data are from 2010; comparable data from 2011 will not be released until next fall.

These figures do not reflect changes in taxes or the value of non-cash benefits, so they miss part of the “very ample safety net” that makes Romney so sanguine about the status of “the very poor.” The Census Bureau stopped reporting broader measures of income a decade ago; the Congressional Budget Office periodically reports on the post-tax-and-transfer income distribution, but their most recent data are from 2007. Wouldn’t it be nice if someone, somewhere, cared enough to generate and disseminate such data in a timely fashion?

Finally, and most importantly, “struggling” is very imperfectly measured by percentage changes in real income. The average real income of middle-quintile households declined from $50,766 in 2008 to $49,309 in 2010, while the average real income of households in the top five percent of the income distribution declined from $298,437 to $287,686. The latter change is larger in percentage terms, and much larger in absolute terms, but may not entail nearly as much human cost. The average real income of households in the bottom quintile declined from $11,803 to $11,034; that sounds like struggling to me, with or without a safety net.