SIZE OF MIDDLE
CLASS AND POVERTY LEVEL
Unfortunately, there is no single definition of "middle
class" or "poverty level" that economists agree upon. All
attempts to define them have their problems.
The definition of "middle class" here is defined as those
people with incomes between 33 percent less than the national median and
50 percent more than the national median.
The definition of "poverty level" here is defined as those
making less than half of the national median.
The obvious objection to these definitions is that different nations
have different medians. The U.S. has the highest median in the world, so
those under its poverty level might actually be doing better than the poor
or even the middle class in other countries.
Although true, defenders of the American status quo frequently overestimate
this effect. The poor in America are probably better off than the lower
middle class in Third World nations. But when we are comparing the richest
nations in the world, all of which have relatively high medians, this observation
loses its force.
Specifically, the average U.S. income (by purchasing power) is 39 percent
higher than Finland's, the lowest rich nation on our list. But U.S. poverty
is 229 percent higher than Norway's, the lowest rich nation on that list;
child poverty is 367 percent higher. (Compared to second-place Canada,
the U.S. has 36 and 45 percent more poverty, respectively.) As you can
see, American poverty is still greater in absolute terms than in other
More inarguably, these statistics reveal the greater inequality of
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