Self-made American myth #2: Who makes $250K?

By sara robinson

Progressives have suspected for years that working- and middle-class Americans vote for the GOP because they have a deeply unrealistic idea about their real chances of becoming wealthy. We’ve joked that working stiffs vote for tax cuts and other goodies for the rich because they seriously believe that they’re going to be rich themselves someday, and want to make sure those advantages will be there for them, come the day.
To date, this has been just a guess on our part — but a recent study now proves that this guess was right on the money. The Myth of the Self-Made American is being bolstered by a delusionally optimistic view of just how many people actually make it to the top 3 percent income level. It’s a delusion that affects almost everyone, but particularly those who vote Republican.
Ryan Enos at yougov.com explains the results of a YouGov/Polimetrix poll conducted a few weeks before the recent election. As he explains their findings:
The hot button issue with the tax cuts is whether to renew the cuts for families earning more than $250,000 a year. The wrangling among politicians over this issue seems to mostly involve whether or not earning that amount of money qualifies somebody as wealthy.
What’s amazing about the magic number of $250,000 is that, based on responses to a recent YouGov/Polimetrix poll, by and large, Americans have a very distorted view of how many people make that much money.
Any idea what proportion of American families make more than $250,000 a year? Or, to potentially make it easier, any idea what proportion of families in your state make more than $250,000 a year?
Don’t feel bad if you don’t know—most people don’t. The actual number, nationwide is somewhere less than 3% of families earn more than $250,000 a year. What did the survey respondents say when asked this question? The average response was close to 17%!—meaning your typical survey respondent thinks that almost 1 in 5 families in America earn that kind of money, when the answer is closer to 1 in 50!
Enos goes on to point out that there are only a few states where the actual number of $250K earners even cracks 8 percdnt — Maryland, Massachusetts, New Jersey, New York, and Virginia. But when the question was put to people in those states, they weren’t even half right, because their answers tilted upward, to about 21 percent.
Furthermore: the more money you make, and the more education you have, the more accurate your guess becomes. People making over $150K guessed an average of about 11 percent; those making under $30K thought it was more like 21 percent. College graduates guessed 12 percent; people with graduate degrees were closer, but not by much.
And only 15 percent of the survey participants answered 3 percent or under –though one-third of those answered “zero,” meaning they thought nobody in the country makes more than $250K a year. Deduct this disconnected 5 percent, and you’re left with just 10 percent of Americans who have a realistic sense of just how rare a $250K income is in this country.
While Republicans and Democrats gave about the same answers, the study also found that the more distorted peoples’ views were, the lower their opinion of President Obama was, and the more likely they were to vote Republican last November 2. The bottom line, says Enos is this: “A person that says 20 percent of people make $250,000 is more likely to vote Republican than a person that says 5 percent of people make $250,000.”
The irony, writes Enos, is that “people making less money actually believe that there are more wealthy people out there than wealthy people do.”
This distortion explains a good deal about why middle- and working-class people vote for the GOP. A quarter of a million dollars sounds like an attainable income to most people — they know at least a few people around town whom they imagine have already made it — and they honestly think that with the right break or a little work, they might get there someday, too. It could happen.
Combine this with the common misunderstanding about how marginal tax rates work (hint: it’s only the income over $250K that’s taxed at the higher rate, not the whole year’s take), and it’s not hard to see why so many people making the average household income of $53K are incensed by the idea of increasing the marginal tax rate on the top 3 percent — and why they think Obama is attacking them personally by suggesting such a horrible thing. They’ve bought into a myth about their chances of moving up the economic ladder that’s at vast odds with the actual facts.
Some critics think Obama picked the wrong number, and that proposing at top tax rate that kicks in at $500K or a cool million would have avoided this problem. The average voter might have had a harder time imagining these numbers as being attainable. Maybe so. But maybe not: given how strong the myth of the self-made American is, and how many falsehoods you have to take on faith to believe it, we may be dealing with a level of delusion that’s impervious to even really huge numbers, the kind that define only the top 0.5 percent of Americans.
We are living in a fact-free world now. Stories are all that matter. And in hard times, people tend to cling harder to their dreams — especially the dream that no matter how bad things are now, someday they’re going to rise above all this and triumph. Telling them the truth under these conditions is hard, and perhaps even cruel.
But one of the hallmarks of countries that are falling into chaos is that people come to believe more and more absurd things. Truth gives way to truthiness; facts aren’t given the same weight as feelings. The huge disconnect between people’s perceived prospects and their actual prospects shows just what a masterful job conservatives have done. They’ve convinced people to believe that their potential for mobility is as good or better than it ever was — even as they’ve stolen the usual routes to a better life (education, home ownership, public investment, and so on) right out from under them.
This post originally appeared at the Campaign for America’s Future.