The American upper class is the wealthiest layer of society in the United States and is often referred to as the rich. People of this class commonly have immense influence in the nation's political and economic institutions as well as public opinion. The American upper class is composed of members born into this class, called members of Old money; as well as those who have acquired their wealth and influence within their own generation, called the Nouveau riche.Inherited wealth may help explain why many Americans who have become rich may have had a "substantial head start". In September 2012, according to the Institute for Policy Studies, "over 60 percent" of the Forbes richest 400 Americans "grew up in substantial privilege". According to PolitiFact and others, in 2011 the top 400 wealthiest Americans "have more wealth than half of all Americans combined."
Many politicians, heirs to fortunes, top business executives, CEOs, successful venture capitalists, those born into high society, and some celebrities may be considered members of this class. Some prominent and high-rung professionals may also be included if they attain great influence and wealth. The main distinguishing feature of this class, which is estimated to constitute roughly 1% of the population, is the source of income. While the vast majority of people and households derive their income from wages or salaries, those in the upper class derive their income from investments and capital gains. Estimates for the size of this group commonly vary from 1% to 2%, while some surveys have indicated that as many as 6% of Americans identify as "upper class." Sociologist Leonard Beeghley sees wealth as the only significant distinguishing feature of this class and, therefore, refers to this group simply as "the rich."
"The members of the tiny capitalist class at the top of the hierarchy have an influence on economy and society far beyond their numbers. They make investment decisions that open or close employment opportunities for millions of others. They contribute money to political parties, and they often own media enterprises that allow them influence over the thinking of other classes... The capitalist class strives to perpetuate itself: Assets, lifestyles, values and social networks... are all passed from one generation to the next." -Dennis Gilbert, The American Class Structure, 1998
Sociologists such as W. Lloyd Warner, William Thompson and Joseph Hickey recognize prestige differences between members of the upper class. Established families, prominent professionals and politicians may be deemed to have more prestige than some entertainment celebrities who in turn may have more prestige than the members of local elites. Yet, contemporary sociologists argue that all members of the upper class share such great wealth, influence and assets as their main source of income as to be recognized as members of the same social class. As great financial fortune is the main distinguishing feature of this class, sociologist Leonard Beeghley at the University of Florida identifies all "rich" households, those with incomes in the top 1% or so, as upper class.
Charts comparing class structure in the United States between 1984 and 2014.
Sources: Department of Labor Statistics (2014). Gilbert, D. (2002) The American Class Structure: In An Age of Growing Inequality. Belmont, CA: Wadsworth; Thompson, W. & Hickey, J. (2005). Society in Focus. Boston, MA: Pearson, Allyn & Bacon; Beeghley, L. (2004). The Structure of Social Stratification in the United States. Boston, MA: Pearson, Allyn & Bacon. The upper middle class may also be referred to as "Professional class" Ehrenreich, B. (1989). The Inner Life of the Middle Class. NY, NY: Harper-Colins.
Functional theorists in sociology and economics assert that the existence of social classes is necessary in order to distribute persons so that only the most qualified are able to acquire positions of power, and so that all persons fulfill their occupational duties to the greatest extent of their ability. Notably, this view does not address wealth, which plays an important role in allocating status and power (see Affluence in the United States for more).
In order to make sure that important and complex tasks are handled by qualified and motivated personnel, society offers incentives such as income and prestige. The more scarce qualified applicants are and the more essential the given task is, the larger the incentive will be. Income and prestige which are often used to tell a person's social class, are merely the incentives given to that person for meeting all qualifications to complete an important task that is of high standing in society due to its functional value.
"It should be stressed... that a position does not bring power and prestige because it draws a high income. Rather, it draws a high income because it is functionally important and the available personnel is for one reason or another scarce. It is therefore superficial and erroneous to regard high income as the cause of a man's power and prestige, just as it is erroneous to think that a man's fever is the cause of his disease... The economic source of power and prestige is not income primarily, but the ownership of capital goods (including patents, good will, and professional reputation). Such ownership should be distinguished from the possession of consumers' goods, which is an index rather than a cause of social standing." -Kingsley Davis and Wilbert E. Moore, Principles of Stratification.
As mentioned above, income is one of the most prominent features of social class, but not necessarily one of its causes. In other words, income does not determine the status of an individual or household but rather reflects upon that status. Income and prestige are the incentives in order to fill all positions with the most qualified and motivated personnel possible.
"If... money and wealth [alone] determine class ranking... a cocaine dealer, a lottery winner, a rock star, and a member of the Rockefeller family-are all on the same rung of the social ladder... [yet most] Americans would be unwilling to accord equal rank to a lottery winner or rock star and a member of one of America's most distinguished families... wealth is not the only factor that determines a person's rank." - William Thompson, Joseph Hickey; Society in Focus, 2005.
Members of the upper class in American society are typically knowledgeable and have been educated in "elite" settings. Wealthy parents go above and beyond to ensure their children will also be a member of the upper class when they grow up. Upper class parents enroll their children in prestigious preschools and elementary schools leading to private middle schools and high schools, and finally elite, private colleges. Along with schools such as Ivy League colleges, upper class members have traditionally joined exclusive clubs or fraternities. Students at Yale University created the Skull and Bones social club. The Skull and Bones was a secret society that had members such as George H. W. Bush and John Kerry. These members obtained valuable social capital by joining the club.
One 2009 empirical analysis analyzed an estimated 15-26.5% of the individuals in the top 0.1% of adjusted gross income (AGI), including top executives, asset managers, law firm partners, professional athletes and celebrities, and highly compensated employees of investment banks. Among other results, the analysis found that individuals in the financial (Wall Street) sector comprise a greater percent of the top income earners in the United States than individuals from the non-financial sector, after adjusting for the relative sizes of the sectors.
A study by Larry Bartels found a positive correlation between Senate votes and opinions of high income people, conversely, low income people's opinions had a negative correlation with senate votes.
Households with net worths of $1 million or more may be identified as members of the upper-most socio-economic demographic, depending on the class model used. While most contemporary sociologists estimate that only 1% of households are members of the upper class, sociologist Leonard Beeghley asserts that all households with a net worth of $1 million or more are considered "rich." He divides "the rich" into two sub-groups: the rich and the super-rich. The rich constitute roughly 5% of U.S. households and their wealth is largely in the form of home equity. Other contemporary sociologists, such as Dennis Gilbert, argue that this group is not part of the upper class but rather part of the upper middle class, as its standard of living is largely derived from occupation-generated income and its affluence falls far short of that attained by the top percentile. The super-rich, according to Beeghley, are those able to live off their wealth without depending on occupation-derived income. This demographic constitutes roughly 0.9% of American households. Beeghley's definition of the super-rich is congruent with the definition of upper class employed by most other sociologists. The top .01 percent of the population, with an annual income of $9.5 million or more, received 5% of the income of the United States in 2007. These 15,000 families have been characterized as the "richest of the rich".
Top 5 states by HNWIs (more than $1 million, in 2009)
^"The study of attitudes is reasonably easy [...] it's concluded that for roughly 70% of the population - the lower 70% on the wealth/income scale - they have no influence on policy whatsoever. They're effectively disenfranchised. As you move up the wealth/income ladder, you get a little bit more influence on policy. When you get to the top, which is maybe a tenth of one percent, people essentially get what they want, i.e. they determine the policy. So the proper term for that is not democracy; it's plutocracy." - Noam Chomsky, "Chomsky: The U.S. Behaves Nothing Like a Democracy, But You'll Never Hear About It in Our 'Free Press'," transcript of a speech delivered at DW Global Media Forum, Bonn, Germany, AlterNet, August 15, 2013.