This is a big debate in the HN world too, where tech workers in that top 10% think they are working class. The real breakdown here is that in todays day and age, there's hardly a middle class, there's the working class who struggles, lives basically paycheck to paycheck, and at the age of 45 has up to 40k in wealth to their name. Then there's that top 10% whose able to afford a million dollar home, take yearly vacations, send their kids to college, ect.

The things the upper middle class think should be a given to them because they are within a certain economic strata are actually just regular luxuries.

Yep, you see it a lot in San Francisco (I've noticed it creeps into my mind a lot more frequently than I'd like to admit).

The thing is, it's like the boiling a frog in water analogy. You get desensitized to it. I tend to work with salespeople, so there's a tendency to get flashier things than a lot of my programming friends, but it manifests in things like always having the latest iPhone (or it's Android equivalent), travelling internationally a couple times a year, going for brunch whenever you feel like it, being able to save a good $10-15k yearly without really trying. Maybe hitting Tahoe a few times in the winter. Going to Soulcycle or Equinox to work out during the week. But you still can't buy a house in San Francisco. So you don't feel rich, but compared to the average American you're taking home a multiple of what they're making. It shocked me to find out the average household income is about $60k annually.

We all live in a bubble. San Francisco is a bubble. Dayton Ohio is a bubble as well. And when you live in a city with a ton of rich people (and a sizeable population probably in the bottom 10%) it gets pretty easy to forget about the other 80% who live somewhere in the middle of it all, in Concord, or Pleasanton or whatever they call it in the East Bay.

"But you still can't buy a house in San Francisco."

Are you in a dual income family, and have you considered buying areas like the Excelsior, Ingleside heights (excluding Ingleside terrace), Oceanview/Merced Heights, Outer Mission, Portola, Silver Terrace, or other such neighborhoods?

I don't mean to dismiss your question, these are still expensive neighborhoods, probably between 800k-1.2mil for something decent. This is tough for two incomes, as the dual income thing means you're also stuck with high childcare costs, which will probably be ~25k per kid in San Francisco (I'm talking about the kind that allows you to go to work from 8am-6pm - and even then you will have to recuse yourself from meetings to be at daycare by 6pm, officially surrendering your membership in the young people are just smarter and can focus on what's important club in Silicon Valley companies[1).

I do think this is in reach of the group you just described, though. 250k+ family income isn't unusual for two tech workers or other professionals in SF (a programmer and dental hygienist pair, for example, should exceed this).

[1] https://venturebeat.com/2007/03/26/start-up-advice-for-entre...

I agree 100%. I meant to sum up the prevailing attitude on housing out here.

It’s relative on how you define wealth really - ability to provide stability in the form of a mortgage, or amount of money you make.

I feel like in SF or any big expensive city owning a home is not something for the middle or upper middle class - there’s a point that no matter how many brunches or vacations you can take, you can’t trade them for a house except in an area where you’ll be basically going down in economic and social class (live out in Tracy or something, have a 2 hour one way commute, far fewer vacations etc). The trade off for that “stability” isn’t one that a lot of people currently renting think is a good deal. IMO the best way to do it is keep on renting while putting as much money in investments and retirement funds as one can, with the idea of retiring somewhere else, or only buying if you get a windfall.

But I’m terms of lifestyle, those in that 9.9% have a far richer one than the rest, but they don’t have the long term security of owning their own home.

Owning a home is overrated, it owns you.

The problem is, renting often ends up owning you too. I'm no stranger to the anxiety of leaky pipes, dry rot, flooded garages, water damage, crazy people you can't easily more away from. On the other hand, I know people who have had to move a few times now because their rent keeps getting jacked up. Single family houses, as well as apartments in many Bay Area cities, aren't rent controlled, so you never know when you're going to be looking at a huge rent increase.

Choose your poison.

Depends how big the home is.

Relative to your income.

My home was about $120k. It’s easily affordable on a tech industry salary. The median household income in my county is under $30k...

Ahh, so you mean the debt owns you, not the house per se.

I'm not jacob019, who originally made the comment, but as I understand it, the point was not the debt. The point was the maintenance. When the basement floods, it's my problem, not the landlords. When the attic fan fails (I was surprised that attics had fans), it's my problem. When the driveway concrete starts to buckle, it's my problem.

In that sense, the house owns you, not the other way around.

this.

That’s what I thought you meant at first, hence my size comment.

Is this just a general comment about mortgages? As it stands, my mortgage is significantly less than most people's as a proportion of my income.

>Yep, you see it a lot in San Francisco

The median household income across San Francisco and San Mateo counties is $115k. People who make close to that are entirely justified in calling themselves middle class. Spending half your take-home on a crappy $2500 apartment doesn't make you rich just because the apartment is in SF.

Homes in Pleasanton are expensive... not sure what you are on about..

Roughly 40% of households have an income between 35k and 100k. This makes your statement that "there is hardly a middle class" absurdly wrong.

This is nothing specifically against you or your comment, but it highlights the problem with how we talk about these things. A single 25 year old making $75k in the suburbs of Youngstown, Ohio is in no way comparable to a family of 4 making $75k living in the San Francisco. We really should frame the numbers in relation to the per capita poverty line for that city/region. For example, middle class should be something approximating 2x-5x the per capita poverty line rather than any specific dollar amount.

I like that idea. Have you seen someone do this before? Would be interesting to see some numbers.

The broader point I'm getting at is that the middle class historically didn't struggle in the way they do now. They used to be able to afford homes, vacations, college, and now that is only available to the upper middle class.

Homes today are roughly twice the size they were in the 1970s [1]. Despite that, home ownership rates are higher than they were in the '70s [2]. More people today have college educations in the U.S. than any time in U.S. history [3]. I'm not fond of the rhetoric about the poor middle class. There are issues we need to solve w/r/t poor economic mobility. We should be focusing our attention more on solving those problems, and less on complaining about things that aren't true.

[1] http://www.aei.org/publication/todays-new-homes-are-1000-squ...

[2] https://en.wikipedia.org/wiki/Home-ownership_in_the_United_S...

[3] https://www.statista.com/statistics/184272/educational-attai...

The economy is a "forward-oriented enterprise." What matters is not so much where we are but where we are going. To that end it's important to understand that homeownership rates are falling fast [1], birth rate is falling [2] and "80s babies" (ie the Millenials) are much, much poorer than their parents were in their 20s and 30s.

If you're an investor (and everybody's an investor whether they like it or not) the question you should be asking is what things will be like in ten years.

That said the article (like pretty much all economics that comes out of The Atlantic) is pretty silly. The dire condition of the American middle class is completely the fault of the US government. In the last 30 years (while China has achieved world historic growth) the US has dumped trillions into wholly unnecessary wars and giveaways to international investors. The $20 trillion dollars the US government has wasted is the greatest malinvestment in the history of the world. All the money that should've been spent on vital innovations and critical investments and infrastructure was used to blow up brown people and inflate asset prices. 2008 was just the beginning; the consequences of this extraordinary malinvestment will take decades to ripple through the global economy. The 9.9% or any other arbitrary percent of Americans are only to blame to the extent that they haven't overthrown their government and executed a few politicians. Over and over electorate have failed to correct the system and so politicians like John McCain -- who helped push America into the greatest crime of the 21st century -- are widely lauded instead of arrested.

[1] https://www.ft.com/content/51771766-7c7c-11e7-9108-edda0bcbc...

[2] https://www.vox.com/science-and-health/2018/5/22/17376536/fe...

[3] https://www.stlouisfed.org/~/media/Files/PDFs/HFS/essays/HFS...

Simply untrue. Do not change the definition of middle class. A single-wide prefab of real lumber for a family of three costs a year of wage or two for a high school graduate. Resourceful individuals can develop land cooperatives. Vacations and college aren't strictly necessary for many, nor particularly unattainable. A road trip anywhere in the USA or continental Europe is nearly free, and a four-year degree at a State U in eight years will barely touch the discretionary income of the sort of individual who has decided to pursue that objective.

The idea of a "middle-class struggle" is confused with changing standards and lifestyles of the middle class. Certainly the regular use of jet airplanes, hotel accommodations, and full-service dining may be out of reach for some, but an urban-agrarian lifestyle with the use of a motorcar and modern conveniences such as electricity and indoor plumbing is cheaper and more accessible than ever.

While I agree with you, people compare themselves to their neighbors not their ancestors so in that sense the goal posts have moved. The bar for "middle" class is higher than it used to be.

Important to note that 'historically' here probably refers to the 4 or 5 decades following the second world war, which may well turn out to have been a historical anomaly in the grand scheme of things.

Agreed that homes and college are getting insanely expensive. But as a counterpoint, a higher % of the population own homes and go to college than in decades past (though certainly accruing higher debt than was needed before).

In a given area, someone making 35k and someone making 100k have very different options at their disposal.

Huh? That's entirely incorrect. There's definitely a middle class that isn't working paycheck to paycheck but can't afford million dollar homes, vacas and college for their kids.

There's also a part of that middle class who can afford vacations and college for their kids, but not million dollar homes. Even if that group is likely bigger outside of the US (since hey, college in European countries like the UK is damn cheap by comparison), it still exists over there in the US too. Neither of those things necessarily require a millionaire income.

To me the point is that "other middle class" you mention, call it lower middle class, is shrinking, falling into the lower class. Because of loss of decent paying factory jobs, retail shrinking, etc. If you are an adult today without special education, it's really hard to have a decent lifestyle. Most of my friends are programmers or teachers, and they most all of them have decent jobs. The teachers are increasingly in that lower middle class category. Software engineers are more fortunate.

> Software engineers are more fortunate.

We are, I earn significantly more than my partner who has a degree and I don't have a degree.

It's one of the last fields that without a degree you can still earn a good living if you can break into it somehow (in my case it was side gigs/contracting to crappy full time position to none-crappy full time position to decent full time position).

Though I'm in the UK, I gather the degree requirement is a harder line in the US, also worth noting that by and large university education has had no correlation with programmer ability (in business settings) in my experience, I've met good/bad with degree/without degree.

Interestingly the one correlation I have observed is how fascinating people find the field when they are children, young geeks become older geeks.

On an unrelated note, this is why I think the programs that encourage young girls to get into computing/programming are the ones with the best likely RoI in terms of re-balancing the field.

I think it used to be easier in the US to be a dev without a degree, but it's hard to get all the background to pass interviews without serious education, things like time complexity and their of computation.

You can easily learn that stuff yourself if you care to; the hardest thing is getting interviews when you don't have the work history yet.

If you are still working you are not part of the richest class.

Measuring income per year misses the richest group of all. Those who would look down on anyone working.

"Every morning when I get up, I look at a list of the richest Americans. If I'm not on it, then I go to work." - Michael Orban

Even the rich need to work to retain their wealth.

In fact, the class of people the GP is talking about do not.

>yearly vacation >kids being able to go to college

People must be insane thinking this is some kind of luxury for rich people, not basic human needs.

I find HN fairly right wing economically & willing to dismiss that a large portion of the country isn't so well off right now, and has been steadily declining since the 90's.

78% currently live paycheck to paycheck, with this number rising year after year [0]. The endless consumerism that this type of unchecked capitalism needs to survive looks to have a pretty bleak future if we keep going down this path.

[0] https://www.cnbc.com/2017/08/24/most-americans-live-paycheck...

They’re not working class, they’re the professional class, but they’re definitely not ‘wealthy’ in the sense that they don’t primarily earn income through invested capital rather than labor.

That said, anyone with a reasonably long career at the upper end of the professional class can make that transition by investing wisely.

Yup! Asking someone "How much money makes a person rich?" is like asking someone "How many drinks makes you an alcoholic?". The answer is typically "Someone who drinks more than I do."

Actually, there is a qualitative difference in play. It is reached at millions USD in (relatively) liquid assets or highly concentrated political power.

It is the potential to do almost anything w here only another big player or a whole society can blunt it and not necessarily effectively.

It is the difference between playing the rules and making the rules.

If you can live entirely from investments you're rich.

Exactly this. I make well into six figures, but only recently. I’ve got a bunch of student loan debt to pay off, I don’t own a house. If I got laid off tomorrow, my family would have serious financial problems within a few months of living off of savings.

I’m doing well, but I’m by no means rich. Now give me another ten years and it’s a different story.

I've made six figures going on three years now. I came from nothing. I was an emancipated minor at 15, made every mistake I possibly could from there to 35(now). I'm climbing out from under it quickly in some respects. My teeth are getting fixed, I'm paying off debt, etc. I know for a fact that I'm one bad lift and twist moving a couch or peculiar mental/physical incident from being homeless.

When I fret to my partner, she says "Honey, you're being to hard on yourself, we are doing great!" But when I look at the stakes and the people I know; The only ones insulated have established families. Having established family even has it's own curse in this day and age. Insulated, sure, but kids that are too insulated via trust fund can get stuck in this weird developmental purgatory that even though they have and won't want, it's hard to find meaning or even give a shit to look for it and take on the risk for what it's worth if they weren't groomed. I've seen lack of meaning take lives.

In the next year I might break loose because I have some ownership in something interesting, but I'm acutely aware of how much it costs to transcend being the wretched of the earth. The treadmill we are on as a human race isn't sustainable. Something I think the article points out succinctly is that with greater inequality we all lose. His grandmother bet it all on the dot com boom and went to work at Wendy's. Anything that isn't an ivy league education is indentured servitude.

I'm lucky to have technology and because I have it, I guess all I can see is potentially a technological equalizer in the near future (at least I hope we can find it near), but we are all being fleeced no matter how you shake it. Globally we are in a race condition similar to a drug addict who didn't realize they were that far gone getting fired from their job. Yeah, the apartment and the girlfriend are up next. But, we have plenty of lies to stack up before then to mask like it's the status quo. This problem is going to take a good think to get solved and we'll need to get high and tight to deal with the stress.

We can still pawn grandpa's coin collection to get a fix this weekend. We'll be back on top before anyone notices.

So all retired people are rich?

Let me guess, you can't entirely live off your investments? ;)

Not sure I agree though. So someone who makes $1M per year from their work, but has no investments isn't rich?

Isn't this a strawman?

Clearly someone who makes $1M could live of their investments.

They could once they acquire enough assets.

By your definition, everyone who retires and lives off their investments is rich as well.

I would say so. 23% of married retired couples and 43% of single retirees subsist on their social security; 50% or so have pensions, and some rely on their children. It's the wealthiest minority who have sufficient investments to live off of.

> 50% or so have pensions

A pension should be considered equivalent to the assets that would produce the same returns.

Except you can't borrow against it, or liquidate it in case of an emergency/opportunity. And it means nothing to your heirs.

Accountants have ways of accounting for pension/annuity returns. Their accounting tricks should be used in these cases.

> I'm sure those 9.9% would be very surprised they belong to the top 10%

Someone with over $1 million in assets is going to be surprised they're in the top 10% of the country? I don't buy it.

> You could strip out the hypocrisy like so: "I am not at the top, so I am still against inequality, but I am comfortable, but since I AM NOT AT THE TOP, YOU CANNOT BLAME ME, so blame the richest"

My read of the article was almost the exact opposite, namely that the author was trying to call attention to the fact that the "top 9.9%" is in fact very much to blame, as evidenced by his concluding remarks :

"It’s going to take something from each of us, too, and perhaps especially from those who happen to be the momentary winners of this cycle in the game. We need to peel our eyes away from the mirror of our own success and think about what we can do in our everyday lives for the people who aren’t our neighbors."

> but you know, at least I don't complain because when I compare it to the rest of the world, being in the lower 50% or 60% or 30% in a modern and developed country is still a pretty good life.

On the one hand, it's nice that you have a sense of perspective and can appreciate that you live a more comfortable life than most of the world's population.

On the other, there's a fine line between a stiff upper lip and stoic complacency. There will always be a greater evil somewhere in the world. Just because Mogadishu is more dangerous than my neighborhood doesn't mean I'm cool with people getting robbed outside my house.

Put more plainly : you have the right to ignore issues in your local community, but you should not try to shame others into silence simply because they're not starving.

I see what you're saying. The next tier down from the rich are more culpable (and well-off) than they realize. I get that that is the authors point, and I agree that it's a good one and one worth making. What I'm saying, is that saying "the 9.9%" have the majority of the wealth (50-60%) is a little disingenuous, because while wealth goes up exponentially, at that point you start running out of money at the high end.

If I said that 70% of the wealth is in the 9.99% and the remaining .01% only have 20% (or whatever it is), that would seem a little odd right? Or 9.999% have 75% and .001% only have 15%? Making cutoffs like this feels like the author is mishandling the numbers in order to make his point. Because there really is a pretty big difference between $1m (90th percentile) in net-worth and $6m (99th). $1m in net-worth quite comfortable but not "rich" by even a very liberal definition of the term in most cities (remember most of that is going to be locked up in a primary residence).

And in the end, yes, it is important to recognize our wealth and privilege and the civic responsibility that comes with it. I just don't like it when numbers are mis-represented, whether the underlying point is valid or not.

"$1m in net-worth quite comfortable but not "rich" by even a very liberal definition of the term in most cities (remember most of that is going to be locked up in a primary residence)."

Selling the $1M house nets about $800k after capital gains. 5% investment interest on that nets about $40k/year without touching the principal.

It's definitely possible for a family of two to live on this amount fairly comfortably in a quite decent apartment in a quite decent neighborhood away from the coasts. I know because I was, and making debt service payments on top of it.

Get a part time job as a package handler at UPS or FedEx - for the exercise, of course - and you're sitting pretty.

A middle-income lifestyle without having to work meets the cutoff for my definition of rich.

But can't you see it's just part of the plan of the really wealthy to distract attention to themselves? "Don't blame us; blame your neighbor who has a bit more than you do".

There's a human tendency to want to blame other humans for everything that happens including weather events.