Are You Rich or Poor? Even the Experts Couldn’t Tell You.

During back-to-back appearances in California Saturday night, presidential candidates Barack Obama and John McCain were asked to address a simple issue:

Define “rich.”

Obama: If you make $250,000 a year or more, you are “doing well.”
McCain: “How about $5 million?”

That information alone was enough to spur hundreds of divisive blog posts. However, the presidential candidates’ cluelessness mirrors the world’s own. In a sense, both answers were innocent.

I looked into some of the data to see what global experts consider “rich” and “poor.” Despite varying opinions, it turns out that the two conditions are largely states of mind.

Slate has a thought-provoking selection of articles on the subject(ivity) of poverty and wealth. Here are some of their more interesting finds:

You’re Poor If…
-You’re a single adult under the age of 65 making $29.58/day or less in the United States. (US labor study)
-You’re part of a family of four (two adults, two children) that makes $18,244 or less annually.
-You make 60% of the median income of your nation (Eurostat/EU)
-You’re living off $1-2/day anywhere in the world. (World Bank)
-You can’t afford to supply yourself with basic clothing, food, and shelter.

Are You Suffering? Maybe.
One study found that poor people still spend money on weddings, funerals, festivals, alcohol, and tobacco. They also, when necessary, find ways to send their children to decent schools.

In Britain, people tend to identify with the working class, even when their high income belies that designation. According to a BBC article, “despite more people thinking they belong to it, the (working class) social group has actually shrunk in size.”

What Makes You Middle Class?
This one’s the clincher. Nobody can agree on what it means to be middle class. Income data appear to be as subjective as class sentiment. Here are a few expert opinions:

You’re Middle Class if…
-You earn between $30,000 and $75,000 a year.
-No, wait. Maybe it’s between $40,000 and $200,000 per year.
-Err. Ahem. Maybe you’re middle class if you can afford a catastrophic illness without sinking into poverty.
-No, no. You’re middle class if you can afford to retire.

Let’s Try That Again. You’re Middle Class if…
-You’re one of 90% of Americans who considers themselves middle class, regardless of income.

What Makes You Rich?

This one’s easier to nail down. Sort of.

You’re Rich if…

-$13.4 million dollars or more, if you’re part of one study.
-$200,000 or more, according to this blogger.
-You’re a US citizen, according to this list.

Conclusion: There is no conclusion.
Value systems are more important than income when it comes to definitions of rich and poor, at least in developed nations like the US. Here, you can look rich and be poor if you live off of heavy credit debt, and you can look poor but be rich if you choose to live simply and hoard money. Class identifications, it seems, override assets when it comes to defining your income status.

Indeed, some working class people make significantly more than so-called elites. For example, a plumber might make around $70,000 per year, while an adjunct professor could make $25,000/year. The professor, however, would be considered upper class by some, while the plumber is a member of the working class. In this case, and many others, values define class more than income—though nobody would instantly categorize either professors or plumbers as being rich.

Insinuations aside, Obama and McCain’s divergent answers on Saturday night reflected the much larger truth about being rich or poor: Nobody really knows which is which.

If, however, belonging to a class comforts you, this New York Times graphic claims to tell you where—and what—you are.

  • Lord

    It isn’t even apparent their answers are that different. Obama used income; McCain may have meant wealth. Using a 4% safe rate, $5M would provide $200K in income, actually lower than Obama.

  • Why even look at absolute incomes?
    A definition that would fit any country would be:
    – Rich is when you can afford luxuries on your *debit card* unthinkingly, any time of the week/month/ year.
    – Middle class is when you ‘indulge’ in the luxuries after some thought of your budget, probably in a certain time of the month/ year.
    – Poor is when you dont even care about the luxuries.

    Luxuries are things you buy/ take services from, on the basis of whim, and want and not because of need or as a special thought.
    If you can buy a Gold Omega because you want to, you are rich; if you plan the purchase and it will be something youve really really wanted, youre probably middle class; if you look at it as something unattainable and out of bounds, well, you are poor.

  • 2Dips,
    Correct me if I’m wrong, but being healthy, good looking and tough but not rich guy you can still have something that even the rich people really really wanted. There are many examples.
    How about spending a cristmas party in the space? How many rich people have the proper health condition to go out the space? and many more…