What’s middle class, anyway?

Ask around, the comments you get won’t likely differ much from those coming to the Advocate: either the economists are lying and we’re in a recession, or Canada is a beacon of economic hope for the world.

Ask around, the comments you get won’t likely differ much from those coming to the Advocate: either the economists are lying and we’re in a recession, or Canada is a beacon of economic hope for the world.

Families are either working harder with less each year or Alberta is once again leading the country in wage gains.

Recently, the mayor of Calgary and one alderman gave up the five per cent pay raises they were due this year, which are pegged to the average wage gain in Alberta. The survey showed average provincial wage gains were five per cent, but the civic leaders in Calgary didn’t believe the numbers.

Do you? How many people do you know who got a five per cent raise last year — or any time in recent memory?

The malaise in society is palpable. People seem disinclined to believe good economic news — or at least news that isn’t as bad as we think it should be.

Calgary’s city council might have asked to see the median wage gain instead. One suspects the midpoint in income change for families is somewhat less than five per cent. In this age of Occupy and the 99 per cent divide, one suspects the average wage gain is rather top-driven.

People have always griped that the rich are getting richer and the poor are getting poorer. That’s a refrain as old as any urban myth. But today, it certainly feels real.

Income disparity isn’t just an issue in the U.S. presidential race. Alberta has the most disparate income curve in Canada, and would probably vie for the lead in that category in North America.

“Middle class” just ain’t what it used to be. Just like the entire economy, the middle class is being economically polarized, with one group heading into the upper zone, and another group looking more and more like the working poor.

Trouble is, both groups have the same expectations about what their lives should be like.

The middle class is supposed to be a group of people with good education and rising prospects. They buy houses and fill them with consumer goods. They pay their debts of today with the higher incomes they’ll earn tomorrow.

Maybe it’s the perspective and the expectations, not the reality, that is wrong. What we regard as middle class is rather new in economic history.

In all the history of countries previous to the Second World War, incomes were always disparate, to things mildly. A much smaller portion of the populations of industrialized societies had “middle class expectations” the way we understand them today.

Nobody retired on a pension, so nobody expected to save for one. There was a lot less square footage of space per person in our homes.

Few expected to “get ahead” in life, in terms of the prosperity that we assume should be available for everyone today.

Big homes for all, more stuff in them, comfortable retirements, savings to invest — these are all fairly recent concepts in the short history of the middle class.

It may be possible that some people think Canada is in recession (when economists do not) because their middle class expectations are not being met, no matter how diligently or efficiently they work.

It may be possible that the divide of the 99 per cent is simply a swing toward a condition that has been the norm since the Industrial Revolution. Perhaps economies simply cannot support a middle class with today’s expectations.

If that’s true, it will take rather more than an Occupy movement to lower the 99 per cent dividing line.

Economists on a CBC Radio talk show recently agreed that they would rather live in the straitened middle class of Canada than in other places in the world where the economy is growing rapidly.

That’s a good observation. It would relieve people’s feelings about our economy, if we could adjust our expectations at least a little.

Greg Neiman is an Advocate editor.

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