Kerby Anderson

The American middle class is disappearing. The editors of the Wall Street Journal believe that is good news since more Americans are earning their way into higher income brackets.

That isn’t the way the decline of the middle class is being portrayed by pundits and politicians. “President Trump’s supporters use this fear of household economic decline to justify his tariffs and industrial policies. Liberals treat it as an excuse for raising taxes, redistributing income, and adding cradle-to-grave entitlements.”

The editors point to recent research by economists at the American Enterprise Institute. They conclude that Americans are enjoying a higher standard of living than any society in history.

The economists set a marker for different income groups based on multiples of the federal poverty level. Based on this, they say Americans have made steady progress out of the core middle class and into the upper middle class. They conclude: “For the first time in American history, more families in 2024 were above the core middle class threshold (35 percent) than below it (34 percent).”

At the same time, many Americans are struggling to make ends meet. The economists cite, “badly distorted markets that raise costs for housing, healthcare and higher education.” American businesses and industry face high levels of government regulation, while others benefit from government subsidies that distort markets. The Wall Street Journal editors lament: “Too bad few in politics or the media understand the role government plays in reducing competition in these industries.”

During this campaign season, we will hear a great deal about affordability and the decline of the middle class. This study reminds us that many Americans have benefitted. The Americans who are doing worse would do better if government would stop distorting markets.