Economix Blog: Who Counts as ‘Rich’?

We’ve written plenty of times about how little Americans know about the distribution of income in the United States, and how many rich people don’t realize they’re rich, at least relative to the rest of the country.

CATHERINE RAMPELL

Dollars to doughnuts.

Now Gallup has surveyed Americans to ask what they believe the cutoff for being “rich” should be. The median response was that a person would need to make at least $150,000 to be considered rich. Here’s a breakdown of the responses:

(The national poll was based on telephone interviews, using landlines and cellphones, with about 500 adults and has a margin of sampling error of plus or minus five percentage points.)

 
According to the Tax Policy Center’s calculations on income distribution, a household earning cash income of $150,000 would fall somewhere between the 89th and 90th percentiles. In other words, the typical American believes anyone in about the top tenth of the income distribution counts as “rich.”

President Obama and others, on the other hand, have set the cutoff around $250,000 when discussing “raising taxes on the rich.” Households earning cash income of $250,000 are somewhere between the 96th and 97th percentiles.

As you might expect, answers to Gallup’s survey question on the threshold for being “rich” varied tremendously by demographics and geography. For example, men cited a higher bar than women did — $150,000 versus $100,000, respectively:

 
Note that respondents with children under 18 said they would require $200,000 before considering themselves rich, whereas the childless were satisfied with a $100,000 benchmark. (That reminds me of this xkcd cartoon.)

As you might expect, those who live in urban areas — like New York City, where the cost of living is very high — or in suburbs had higher standards for being “rich” than did Americans who live in towns or rural settings.

Readers, I’m curious: What’s your definition for who counts as “rich”?

Article source: http://feeds.nytimes.com/click.phdo?i=c4f1f90f969c36613bcec8c441403062