One of the favorite Dem complaints about GOP President G.W. Bush is that under his watch the rich got richer, while the fortunes of the middle class tanked and the poor got even poorer and less medically insured (hence the perceived need for the Kerry twist on Hillarycare-style government-supplied medicine).
In a column for this week’s Newsweek, however, economist Robert J. Samuelson points out that the reason the statistics look that way isn’t because the middle class is getting poorer–in fact it’s been getting markedly more prosperous over the past decade or so. And yes, there’s been a statistical drop over the last decade in the U.S. median household income–but as Samuelson points out, it correlates strongly with the huge influx during the same period of immigrants, especially from dirt-poor Hispanic countries, who are willing to take the lowest-paying jobs. By contrast, the number of poor whites and poor blacks has actually shrunk dramatically since 1990. In a word, America is becoming poorer, Samuelson says, because the poor are flocking to America.
Samuelson writes:
“The census bureau’s annual figures on family incomes and poverty were bound to become familiar factoids in the Bush-Kerry combat. The numbers seem to confirm what many people feel: the middle class is squeezed; poverty’s worsening. In 2003 the median household income dropped for the fourth consecutive year, to $43,318; the official poverty rate rose for the third year, to 12.5 percent of the population; and the number of people without health insurance increased for the third year to 45 million, or 16 percent of the population. But the debate you’re hearing is not the real deal….
“The Census statistics are both better and worse than advertised. They’re better because the middle class isn’t vanishing. Many middle-class families achieved large income gains in the 1990s and–despite the recession and halting recovery–have kept those gains. They’re worse because the increase in poverty in recent decades stems mainly from immigration….
“Mostly, the middle class is getting richer. Consider: in 2003, 44 percent of U.S. households had before-tax incomes exceeding $50,000; about 15 percent had incomes of more than $100,000 (they’re also included in the 44 percent). In 1990 the comparable figures were 40 percent and 10 percent. In 1980 they were 35 percent and 6 percent. All comparisons are adjusted for inflation.”
Although households are a little worse off income-wise today than they were in 1999, at the peak of the high-tech boom, Samuelson concedes. they are also smaller on average than they’ve ever been, as the number of the four-person households that we think of as typical (Mom, Dad, two kids) inexorably shrinks and the number of two-person and single-person households inexorably grows. The slight downtick since 1999 may be no downtick at all in terms of individual income, and at any rate it’s on the mend with a post-recession growing economy.
Samuelson continues:
“Now look at poverty. For 2003, the Census Bureau estimated that 35.9 million Americans had incomes below the poverty line; that was about $12,000 for a two-person household and $19,000 for a four-person household. Since 2000, poverty has risen among most racial and ethnic groups. Again, that’s the recession and its after-math. But over longer periods, Hispanics account for most of the increase in poverty. Compared with 1990, there were actually 700,000 fewer non-Hispanic whites in poverty last year. Among blacks, the drop since 1990 is between 700,000 and 1 million, and the poverty rate–though still appallingly high–has declined from 32 percent to 24 percent. (The poverty rate measures the percentage of a group that is in poverty.) Meanwhile, the number of poor Hispanics is up by 3 million since 1990. The health-insurance story is similar. Last year 13 million Hispanics lacked insurance. They’re 60 percent of the rise since 1990.”
Politicians don’t like to look at these numbers, Samuelson says, because that involves tackling the thorny issues of immigration and prejudice against Hispanics (not all of whom are poor, as Samuelson notes). That’s why we don’t hear much about them.
But it’s good to know, when someone brings up the Dem canards about the “disappearing middle class” or the “health-insurance crisis,” that these phenomena have nothing to do with GOP fiscal and tax policies.