The middle class is now a minority in the United States, according to a study released in December by the Pew Research Center, which warns of “a demographic shift that could signal a tipping point.” We hope not to reach another tipping point, at which policymakers would accept the steady loss of middle-class families as inevitable. This would be another sign that we have given up on the idea of a common good, following the near-extinction of labor unions, the pursuit of productivity at the expense of a just wage and the indifference of the federal government to widening economic inequality.
Using data from the Census Bureau, the Pew researchers estimate that the share of adults living in middle-income households fell to just under 50 percent last year from 61 percent in 1970. Upper-income households, or those making more than twice the median (for a family of three, the median is $63,000), rose to 21 percent of the total from 14 percent. Lower-income households, or those making less than two-thirds of the median, also increased, to 29 percent from 25 percent.
Catholic social teaching encourages us to look at concepts like the common good and solidarity as we make public policy decisions, and the trend identified by the Pew Center is worrisome by these standards. A shrinking middle class suggests fewer opportunities for upward mobility. It means a less dynamic economy, with lower consumer spending and fewer people taking the risk of starting small businesses. (Upper-income households are more likely to park their funds in safe investments.) And the eroding of a common ground for most American households could worsen the polarization of our politics, making it more difficult to enact policies that benefit the greatest number of families.
Upper-income households, accounting for an ever-larger share of the nation’s total earnings, may not even grasp that the rest of the country is withering. From 2001 to 2013, the median wealth of households in the middle class fell by 28 percent.
Not surprisingly, polls show ever-greater pessimism about the future and disenchantment with the political process, especially among voters without college degrees—the voters who feel the loss of civic solidarity most keenly and fear ending up on the wrong side of a growing economic divide. Middle-class families are justified in feeling abandoned by both political parties.
We need an acknowledgment of objective reality, as opposed to partisan loyalties. There are ways to support the middle class and promote economic security for all citizens that merit the support of lawmakers across the ideological spectrum. Chief among them is the enactment of policies that ease the economic burdens of starting and raising a family. Paid parental leave and child-care assistance, as well as increases in the child tax credit and earned income tax credit, could help some families attain the economic security needed to climb into the middle class—and could help other families at risk of sliding out of the middle class.
We also need to increase educational opportunities. According to the Pew study, 69 percent of all adults with no more than a high school education were considered middle-class in 1971, with only 17 percent in lower-income households. By last year, only 53 percent were in the middle-income group, with 36 percent in lower-income households. A study from Georgetown University’s Center on Education and the Workforce last year estimated that the number of jobs held by workers with a high school diploma or less declined by 6.3 million during the recession, and “there has been virtually no recovery of these jobs” since. We must recognize that post-secondary education is becoming essential for almost any job that can support raising a family, and we must control costs and provide tuition assistance so that this option is universally available.
Housing costs are also putting a squeeze on the middle class. The Harvard Joint Center for Housing Studies reported last month that, partly due to the foreclosure crisis, 37 percent of all households now rent rather than own, the highest level since the 1960s. Apartments are not being built fast enough to keep up with this new demand, and just over a quarter of these households pay more than half their income for rent. Unless we want a repeat of the foreclosure crisis, we should not treat owning a home as a prerequisite for membership in the middle class. That means reforming exclusionary zoning and other laws that hinder the creation of rental housing within a reasonable distance of secure jobs.
The Gospels give priority to caring for our most vulnerable fellow human beings (Matthew 25), but the erosion of the middle class and the attendant cleaving of American society endanger any consensus on how to promote the common good. The “tipping point” identified by the Pew study should be a call to action, not an admission of defeat.