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American Middle Class - 5/2/14

A recent analysis conducted by the group that maintains the Luxembourg Income Study Database and by the Upshot, a website covering policy and politics, indicates that America’s middle class, long the world’s most affluent, has lost that distinction.  While the wealthiest Americans still outpace many of their global peers, the lower and middle income tiers in other nations have enjoyed more rapid income gains that their American counterparts. 

The numbers are based on surveys conducted over the past 35 years.  Although economic growth in the US remains as strong or stronger than in many other nations, a shrinking percentage of Americans is benefiting from that growth. 

Median income in Canada pulled into a tie with median US income by 2010 and has likely surpassed it since.  Median incomes in Western European nations still fall short of those in the U.S., but Britain, the Netherlands and Sweden have significantly closed that gap over the past 10 years.  A family at the 20th percentile of income distribution in the US makes significantly less money than similarly situated families in Canada, Norway, and Finland.  That was not true 35 years ago.

Anirban Basu, Chariman Chief Executive Officer of Sage Policy Group (SPG), is one of the Mid-Atlantic region's leading economic consultants. Prior to founding SPG he was Chairman and CEO of Optimal Solutions Group, a company he co-founded and which continues to operate. Anirban has also served as Director of Applied Economics and Senior Economist for RESI, where he used his extensive knowledge of the Mid-Atlantic region to support numerous clients in their strategic decision-making processes. Clients have included the Maryland Department of Transportation, St. Paul Companies, Baltimore Symphony Orchestra Players Committee and the Martin O'Malley mayoral campaign.