NCPA - National Center for Policy Analysis

Critics Challenge Report That Middle Class Missed Out On 1990s Boom

August 31, 2001

An analysis that purports to show that the economic boom of the late 1990s passed by the middle class in New York, Connecticut, California and Washington, D.C., is being met by skepticism among economists. "I would challenge anybody to find a middle-class family in this region whose economic condition has declined," Stephen Kagann, chief economist to New York Gov. George E. Pataki (R), states flatly.

The study, conducted for the New York Times by Queens College sociology professor Andrew A. Beveridge, found that the gap between rich and poor inched wider throughout the country during the 1990s. Beveridge compared income data from the 1990 census with data from an experimental Census Bureau survey done in 2000.

Here are some of the controversial findings from the report:

  • In New York State, the poor have treaded water, the well-off made gains and the middle class experienced an income squeeze.
  • In New York, average family income of the richest fifth rose 13.6 times the average of the poorest fifth.
  • Nationally, average family income of the top fifth of earners rose to 10.9 times that of the poorest fifth -- up from 10.4 times in 1990.
  • Average income of Washington, D.C., families in the wealthiest fifth of the population, adjusted for inflation, grew to 24 times the average in the bottom fifth -- up from 18 times.

But Kagann points out that many middle-class people left New York during the recession of the early 1990s, while many immigrants moved in. He says that by itself would bring the median down and "it would simply be untrue" that a middle-class person was less well off than in 1990.

California officials also expressed skepticism over the Beveridge conclusions.

Source: Janny Scott, "Boom of 1990s Missed Many in Middle Class, Data Suggests," New York Times, August 31, 2001.

 

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