It’s the drum beat of conventional journalism. The rich are getting richer. Everyone else is getting poorer. To assure us this is so, we’re shown a picture of yet another mega-yacht.
But is that true?
A good deal of walking around evidence suggests we multitudes have plenty to spend. Not everyone, to be sure. But restaurants are crowded. Sports and entertainment venues continue to rack up enormous revenue — despite mind-bending ticket prices. Airports are still teeming with travelers, video meeting alternatives notwithstanding.
Crowds like this don’t happen if only the top 1 percent are gaining while everyone else is losing. The economy won’t run on private jets alone.
An examination of our income statistics tells us the empty glass view isn’t true. Here’s some evidence. In January, the American Enterprise Institute published a paper. Written by Stephen J. Rose and Scott Winship, it provides the numbers.
The title does more than hint: “The Middle Class Is Shrinking Because of a Booming Upper Middle Class.”
As ideas go, this hasn’t had wide circulation. If it has, a lot of people are pretending they never saw it.
Almost Everyone Can Be Middle Class, Somehow
It turns out there are many definitions of “middle class.” Researchers have found, in fact, that 90 percent of all Americans could be considered “middle class” by at least one of a dozen common definitions.
So Rose and Winship decided to measure classes another way. They defined five divisions, as you’ll see below. The classes were separated by dividing lines of constant purchasing power. If a household enjoyed a large enough increase in real purchasing power, it could move from poor or near poor to lower middle. Another household could move from core middle to upper middle, etc.
A rising tide of purchasing power, unlike water, doesn’t lift all boats equally. Some boats rise; some don’t. But if most boats are rising, that’s a good thing.
That’s what Rose and Winship found. Measuring changes in the size of classes between 1979 and 2024, they found the lower income groups were shrinking. The higher income groups were increasing in size. The higher income groups increased so much that the core middle class was shrinking.
Here are the changes in percent of all households between those years:
—Poor and near poor decreased from 29.7 percent to 18.7 percent of all families.
—Lower middle class decreased from 24.1 percent to 15.8 percent.
—Core middle class decreased from 35.5 percent to 30.8 percent.
—Upper middle class soared from 10.4 percent to 31.1 percent.
—Rich people ballooned from 0.3 percent to 3.7 percent.
Stare at those figures for a few minutes. Small wonder wealth and affluence are more visible! There’s a lot more of it.
The rich went from a trace element, 0.3 percent, to 3.7 percent. That’s a huge and visible change. The upper middle class tripled in size. At 31.1 percent of all households, it’s now slightly larger than the 30.8 percent of the core middle class!
The Poor Are Still With Us
But we still have plenty of households that are poor, near poor or part of the threatened lower middle class.
Need I say that fear and anxiety are probably greater today because what you can lose access to is massively more visible? Whether it’s an uninsured illness, a chronic illness or a job loss, what you can lose is clear and palpable.
Let me provide an extreme, but personal, example of wealth visibility. When I was a little boy in the late 1940s, my mother and I shared a rented room in a rooming house. Few had TV. We had a radio. The closest thing to a rich person I ever saw was a boy in my grade at school. He regularly made $5 deposits to the regular Savings Bond drive. That seemed showy. And impossible. Everyone else in the class, including me, gawked. I still remember his name.
Today, the rich are visually inescapable. Virtually all households have a TV set. But now, the metric is TV sets per household. The rich are a constant subject in all forms of media. We are well informed about where we stand and the power of the very rich.
Tra-La-La and The Fate of Affluence
The tra-la-la view here is that everything is hunky-dory because more people are doing better than ever before (if only they had the right perspective). I’ll admit to having a foot in this camp. We forget our good fortune too quickly. We’re eager to let gratitude be displaced by worry.
But there’s another question. It’s never addressed by the Abundance and Affluence crowd. More people enjoying affluence and abundance has a way of changing, almost always for the worse, the experience. It’s also quite impossible for every single human to enjoy the experience of, say, his or her own mega-yacht.
Yes, I know. You don’t want one. Neither do I. But I assure you that more people want one than can possibly have one. And that’s just the start for impossible dreams of affluence and abundance. It applies, as you’ll soon see, to McDonald’s Big Macs and Starbucks’ Caramel Macchiatos, too.
Related columns:
Scott Burns, “Seeking the New Rules of Travel,” 8/01/2026: https://scottburns.com/seeking-the-new-rules-of-travel/
Scott Burns, “The Life of Riley Gets Tough. Again,” 8/07/2026 https://scottburns.com/the-life-of-riley-gets-tough-again/
Scott Burns, “The Incredible Disappearing Luxury Carrot,” 4/9/2022: https://scottburns.com/the-painful-cost-of-luxury-inflation/
Sources and References:
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Photo: Scott Burns, 10/23/2021: Herrington Harbor South Marina, Maryland, in early evening perfect calm
(c) Scott Burns, 2026
Instead of using 1979 as a starting date, it would be instructive to see the data from 1999 or 2009 until now.
It is an interesting paper that describes rising incomes and the changing shape of incomes. However, no mention of the changing shape of basic necessities. I would like to see the same argument tempered by the consumer prices over the years: amounts needed for rent/home, food, medical expenses, transportation, post high school education. Perhaps the rising CPI exceeds income gains and affect different classes differently. Perhaps a lower income worker could afford to send two children to college back then versus now. (I don’t know, but I would like to see that analysis.)