Middle Class Hits 50 Year Low on President Obama’s Watch

AP Photo/Gregory Bull
AP Photo/Gregory Bull

President Barack Obama in his State of the Union speech said, “The verdict is clear, middle class economics works.” Obama said lots of words about how the U.S. economy has improved, but he avoided the “numbers” regarding how or if that improvement had reached the middle class. If the president had used the “numbers,” he would have to explain why real middle class paychecks hit a 50 year low on his watch.

American history is filled with stories about upward mobility. The Midwest and West opened land that could be exploited, and the massive industrialization in the late 19th and early 20th centuries opened opportunities. According to Stratfor, the systemic expectation of upward mobility is part of our culture.

In the 1960s, the middle class family could be supported by a single earner — normally the husband, with the wife typically working as homemaker taking care of about 3 children. The middle class dad could purchase a modest tract house in the suburbs, buy one late model car, and own an older one. He usually could enjoy a driving vacation somewhere and, with care, some savings. Although there were challenges, this was a good life for most Americans.

Over the last 50 years, the middle class earnings per hour grew steadily from $2.56 an hour to $20.68 today. But adjusted for inflation, the middle class wage was $19.12 under President Johnson in 1964; peaked at $22.31 under President Nixon; bottomed under $18 under President Clinton; and is currently $20.68 under President Obama.

But during that same 50 year period, the average number of hours worked per week dropped from a peak of 38.8 under President Johnson to a 50 year low of 33.9 hours per week under President Obama. Adjusted for inflation and the 12.6% fewer hours worked per week, the real middle class hourly wage has fallen by 10% under President Obama to $17.25 an hour.

That means the average middle class American is making $36,454.60 a year. Take off 10% for taxes and the average middle class worker has to live on only $2,734.09 a month. It is also important to remember that half of all Americans earn less than this “average” middle class worker.

It is almost impossible to maintain a 1960s middle class life style near any American metropolitan city. Most families today have two car payments that equal about $700, plus food, clothing, and utilities costs of about $1,200. Given that the average mortgage payment is $1,400, the $834.09 left for the middle class wage earner today is not enough to live what is still thought of as a middle class lifestyle.

In Barack Obama’s first address to a joint session of Congress in 2009, he only mentioned the middle class once. But after raising taxes, socializing health care, and adding about $8 trillion to the U.S. national debt, the president was seven times more interested in mentioning the middle class tonight.

Obama paraded out his newest campaign tagline when he said, “Tonight, we turn the page.” But after six years of rhetoric and deficit spending, Barack Obama’s policies have led to the worst middle class wages in 50 years.


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