Realty Times – The Joys of Homeownership

Realty Times – The Joys of Homeownership.

America’s Most And Least Reputable Big Companies

Sales Leadership

America’s Most And Least Reputable Big Companies

Jacquelyn Smith, 04.05.11, 12:01 AM EDT  Forbes List

“Amazon is the most reputable company in the U.S. in 2011 because consumers believe that it stands for more than what it sells,” says Anthony Johndrow, managing partner at Reputation Institute. “Its enterprise-wide story engages consumers in more than just delivering innovative products and services, a trustworthy and ethical customer experience or strong financial performance. The whole really is greater than the sum of the parts with Amazon, and this holistic perception creates a meaningful connection between Amazon and consumers, resulting in an excellent reputation score.”

The industrial products firm 3M ( MMM news people ), another newcomer to the top 10, holds the No. 4 spot with a pulse score of 81. The St. Paul-based company is constantly innovating and acquiring businesses to stay ahead of the curve. A year of strong financial performance raised its profile and enhanced its reputation as a company.

“The people of 3M have always understood the compelling nature of character and integrity as the defining elements of our reputation,” George W. Buckley, 3M’s chief executive, told Reputation Institute. “This reputational foundation is the critical element in building the trust of our customers in 3M as we work towards their success, as well as our own. Technology and integrity are the combined glue that holds 3M together.”

In Pictures: America’s 10 Most Reputable Companies

In Pictures: America’s 10 Least Reputable Companies

After dropping out of the top 10 last year, FedEx ( FDX news people ) returns in the No. 7 spot, with a pulse score of 79.63. Why? With its legendary founder, Fred Smith, still pushing the envelope as he leads the way on vehicle energy efficiency standards, FedEx’s excellent reputation starts at the top. The logistics services company invests in telling its enterprise-wide story rather than focusing exclusively on products and services, and that allows consumers to applaud what it stands for, not just what it sells.

Last year’s winner, Johnson & Johnson ( JNJ news people ) (No. 3), has made the top 10 for the past six years. Food makers Kellogg‘s ( K news people ) (No. 5) and Sara Lee ( SLE news people ) (No. 8) and tech giant Google ( GOOG news people ) (No. 9) all dropped two spots from 2010–but stayed near the top nonetheless.

Overall, consumer products, industrial products, food manufacturing, computer and general retail companies scored highest. At the other end of the spectrum, telecommunications, energy and diversified financial companies earned the weakest scores.

“The next segment gives a reason to pause. Let’s consider the” why” before we look at “how” this can be turned around. Sometimes a glaring ” F” on the report card is the wake up call needed to inspire change. Both success and failure leaves clues. The companies at the top of the list are  not there by accident, neither are the ones at the bottom. Will you and your company position yourselves to be at the top  of your segment?

Number 34 , 35 and 62 are in very competitive segments and yet they maintain a ranking far superior to their peers between the 100 – 150 positions.”

Decide to Compete at YOUR highest level!, Dixon Judd, CEO of Performance Resource Group.

The least reputable company on the list this year: Freddie Mac ( FRE news people ). In dead last, the home mortgage financier earned a pulse score of 29.47. AIG ( AIG news people ) did only slightly better with 33.94 points, and Fannie Mae ( FNM news people ) proved the third least reputable company, with a score of 34.70. In the No. 4 spot, Goldman Sachs ( GS news people ) dropped 9.6 points to 37.14. But it’s not all bad for financials. A few in the sector saw significant reputation gains this year. US Bancorp ( USB news people ) and JPMorgan Chase ( JPM news people ) saw their scores increase by 4.79 and 4.11 points, respectively. Citigroup ( C news people ) (+9.11) and Morgan Stanley ( MS news people ) (+8.04) had some of the biggest jumps on the list.

2011 Rank Company Stock Ticker RepTrak Pulse 2011 RepTrak Pulse 2010 Change vs. 2010 Industry
1 AMZN 82.7 76.94 5.76 Retail – General
2 Kraft Foods KFT 81.4 84.84 -3.45 Food – Manufacturing
3 Johnson & Johnson JNJ 81.32 85.82 -4.49 Consumer Products
4 3M MMM 81 77.15 3.85 Industrial Products
5 Kellogg’s K 80.87 82.78 -1.91 Food – Manufacturing
6 UPS UPS 80.46 78.93 1.53 Transport & Logistics
7 FedEx FDX 79.63 77.59 2.04 Transport & Logistics
8 Sara Lee SLE 79.53 80.04 -0.51 Food – Manufacturing
9 Google GOOG 79.25 79.31 -0.06 Information & Media
10 Walt Disney Company DIS 79.02 82.11 -3.09 Information & Media
11 Texas Instruments TXN 78.46 75.79 2.68 Computer
12 Caterpillar CAT 77.95 78.07 -0.12 Industrial Products
13 Kohl’s KSS 77.91 71.43 6.48 Retail – General
14 Whirlpool WHR 77.51 76.81 0.69 Consumer Products
15 General Mills GIS 77.44 78.46 -1.03 Food – Manufacturing
16 HJ Heinz HNZ 77.29 77.46 -0.17 Food – Manufacturing
17 Berkshire Hathaway BRK.A 77.24 73.92 3.32 Financial – Diversified
18 Eastman Kodak EK 76.85 77.73 -0.88 Consumer Products
19 Staples SPLS 76.5 77.7 -1.2 Retail – General
20 Procter & Gamble PG 76.45 74.26 2.18 Consumer Products
21 Lowe’s Home Improvement LOW 76.35 76.64 -0.28 Retail – General
22 Intel INTC 76.34 76.88 -0.54 Computer
23 Target TGT 76.17 73.49 2.68 Retail – General
24 Home Depot HD 76.11 74.29 1.83 Retail – General
25 Coca-Cola KO 75.85 76.86 -1.01 Beverage
26 Macy’s M 75.69 70.43 5.27 Retail – General
27 JC Penney JCP 75.34 76.28 -0.94 Retail – General
28 PepsiCo PEP 75.09 81.2 -6.1 Beverage
29 Colgate-Palmolive CL 74.4 77.99 -3.59 Consumer Products
30 CVS Caremark CVS 74.31 71.44 2.87 Retail – General
31 Xerox XRX 74.31 75.99 -1.68 Industrial Products
32 Kimberly-Clark KMB 74.14 73.25 0.89 Consumer Products
33 Baxter International BAX 74.04 68.98 5.05 Services
34 Southwest Airlines LUV 74.02 73.38 0.64 Airlines & Aerospace
35 Marriott International MAR 74.02 76.29 -2.27 Services
36 Kroger KR 73.86 73.35 0.51 Retail – Food
37 Avon Products AVP 73.67 73.2 0.47 Consumer Products
38 Goodyear GT 73.62 74.24 -0.62 Automotive
39 Office Depot ODP 73.58 73.06 0.52 Retail – General
40 Hewlett-Packard HPQ 73.58 76.92 -3.34 Computer
41 Nike NKE 73.45 74.11 -0.66 Consumer Products
42 Cisco Systems CSCO 73.22 71.1 2.12 Computer
43 Costco Wholesale COST 73.21 72.98 0.23 Retail – General
44 IBM IBM 73.12 76.77 -3.65 Computer
45 BJ’s Wholesale Club BJ 73.04 73.63 -0.59 Retail – General
46 Apple AAPL 72.89 78.36 -5.47 Computer
47 Microsoft MSFT 72.73 79.28 -6.55 Computer
48 State Farm Insurance 72.7 65.1 7.6 Financial – Insurance
49 Oracle ORCL 72.66 70.04 2.61 Computer
50 Tyson Foods TSN 72.51 72.66 -0.15 Food – Manufacturing
51 Honeywell International HON 72.27 66.82 5.45 Industrial Products
52 Deere & Co. DE 72.2 73.58 -1.39 Industrial Products
53 Walgreens WAG 72.14 73.33 -1.19 Retail – General
54 Dean Foods DF 72.11 78.79 -6.68 Food – Manufacturing
55 Motorola MSI 71.74 75.5 -3.76 Electrical & Electronics
56 Alcoa AA 71.51 69.93 1.58 Raw Materials
57 Ford F 71.47 64.3 7.18 Automotive
58 Medtronic MDT 71.35 72.57 -1.22 Services
59 Hess HES 71.04 68.38 2.65 Energy
60 TJX Companies TJX 70.75 66.6 4.15 Retail – General
61 Southern Company SO 70.28 72.95 -2.67 Utilities
62 Prudential PRU 70.25 67.88 2.37 Financial – Insurance
63 Boeing BA 69.65 71.16 -1.51 Airlines & Aerospace
64 Time Warner TWX 69.44 54.46 14.98 Information & Media
65 General Electric GE 69.29 76.55 -7.26 Conglomerate
66 Bristol-Myers Squibb BMY 69.27 66.91 2.36 Pharmaceuticals
67 New York Life Insurance 69.23 63.72 5.51 Financial – Insurance
68 Safeway SWY 69.15 70.77 -1.62 Retail – Food
69 Nordstrom JWN 69.06 69.28 -0.22 Retail – General
70 Gap GPS 68.91 69.47 -0.57 Retail – General
71 Dell DELL 68.71 75.66 -6.95 Computer
72 DuPont DFT 68.37 70.61 -2.25 Chemicals
73 Supervalu SVU 68.04 63.24 4.8 Retail – Food
74 Chubb CB 68 69.39 -1.39 Financial – Insurance
75 Constellation Energy CEG 67.68 66.2 1.47 Utilities
76 Travelers TRV 67.51 67.31 0.2 Financial – Insurance
77 Eli Lilly LLY 67.44 68.28 -0.84 Pharmaceuticals
78 Best Buy BBY 67.43 72.58 -5.15 Retail – General
79 Hartford Financial Services HIG 67.42 65.17 2.26 Financial – Diversified
80 ConAgra Foods CAG 67.27 71.26 -4 Food – Manufacturing
81 eBay EBAY 67.16 71.19 -4.03 Retail – General
82 BB&T BBT 66.94 66.29 0.65 Financial – Bank
83 Pfizer PFE 66.69 69.67 -2.99 Pharmaceuticals
84 Amgen AMGN 66.65 70.48 -3.83 Pharmaceuticals
85 Abbott Laboratories ABT 66.58 71.82 -5.24 Pharmaceuticals
86 Liberty Mutual Insurance 66.26 63.57 2.69 Financial – Insurance
87 Progressive PGR 66.19 67.67 -1.48 Financial – Insurance
88 Sears Holdings SHLD 66.13 63.91 2.23 Retail – General
89 Allstate ALL 66.02 64.35 1.67 Financial – Insurance
90 Bank of New York Mellon BK 65.66 60.17 5.5 Financial – Bank
91 Nationwide NFS 65.56 66.84 -1.28 Financial – Insurance
92 Continental Airlines UAL 65.46 60.29 5.17 Airlines & Aerospace
93 Rite Aid RAD 65.31 76.04 -10.73 Retail – General
94 MetLife MET 65.25 65.15 0.1 Financial – Insurance
95 Starbucks Coffee SBUX 65.05 68.2 -3.15 Retail – Food
96 American Express AXP 64.93 62.12 2.81 Financial – Diversified
97 FPL Group (now NextEra Energy) FPL (now NEE) 64.89 64.73 0.16 Utilities
98 SunTrust Banks STI 64.85 68.1 -3.25 Financial – Bank
99 Reynolds American RAI 64.83 . . Tobacco
100 CBS Broadcasting CBS 64.82 68.25 -3.43 Information & Media
101 UAL – United Airlines UAL 64.76 59.95 4.81 Airlines & Aerospace
102 Delta Air Lines DAL 63.85 62.79 1.06 Airlines & Aerospace
103 Merck MRK 63.81 65.24 -1.43 Pharmaceuticals
104 Wal-Mart WMT 63.73 61.72 2.01 Retail – General
105 Aflac AFL 63.33 65.15 -1.82 Financial – Insurance
106 UnitedHealth UNH 63.3 56.06 7.23 Services
107 US Airways LCC 63.26 63.27 -0.01 Airlines & Aerospace
108 Verizon Communications VZ 63.08 65.93 -2.85 Telecommunications
109 Duke Energy DUK 63.06 . . Utilities
110 General Motors GM 62.95 52.26 10.69 Automotive
111 AMR – American Airlines AMR 62.91 63.9 -1 Airlines & Aerospace
112 Unum Group UNM 62.54 . . Financial – Insurance
113 Xcel Energy XEL 62.52 . . Utilities
114 WellPoint WLP 62.52 62.76 -0.24 Services
115 McDonald’s MCD 62.47 72.41 -9.93 Retail – Food
116 Viacom VIA 61.86 60.74 1.13 Information & Media
117 Aetna AET 61.75 66.09 -4.34 Services
118 Altria MO 61.64 57.41 4.24 Tobacco
119 Sunoco SUN 61.36 63.81 -2.45 Energy
120 Humana HUM 61.08 64.11 -3.03 Services
121 Dow Chemical DOW 61.05 63.88 -2.83 Chemicals
122 AutoNation AN 61.01 61.39 -0.38 Retail – General
123 Morgan Stanley MS 60.51 52.48 8.04 Financial – Diversified
124 Chevron CVX 60.43 58.03 2.39 Energy
125 US Bancorp USB 60.31 55.52 4.79 Financial – Bank
126 Sprint Nextel S 60.15 60.06 0.09 Telecommunications
127 JPMorgan Chase JPM 59.89 55.78 4.11 Financial – Diversified
128 ConocoPhillips COP 59.86 61 -1.14 Energy
129 Archer Daniels Midland ADM 59.77 64.53 -4.75 Food – Manufacturing
130 Exelon EXC 59.67 61.05 -1.39 Utilities
131 Marathon Oil MRO 59.61 64.63 -5.02 Energy
132 CIGNA CI 59.34 60.55 -1.21 Services
133 AT&T T 59.33 67.25 -7.92 Telecommunications
134 Assurant AIZ 59.1 . . Financial – Insurance
135 Valero Energy VLO 58.57 60.57 -2 Energy
136 DISH Network DISH 58.39 58.82 -0.43 Information & Media
137 Wells Fargo WFC 57.82 56.9 0.92 Financial – Bank
138 DirecTV DTV 57.63 55.36 2.26 Information & Media
139 Qwest Communications Q 56.14 . . Telecommunications
140 News Corporation NWSA 55.47 56.16 -0.69 Information & Media
141 Bank of America BAC 53.4 51.62 1.79 Financial – Bank
142 Comcast CMCSA 51.62 52.09 -0.48 Information & Media
143 Capital One Financial COF 50.52 52.72 -2.2 Financial – Diversified
144 Citigroup C 49.46 40.35 9.11 Financial – Diversified
145 ExxonMobil XOM 44.99 48.02 -3.03 Energy
146 Halliburton HAL 37.62 31.43 6.19 Construction & Engineering
147 Goldman Sachs GS 37.14 46.75 -9.6 Financial – Diversified
148 Fannie Mae (Federal National Mortgage Association ) FNMA 34.7 38.22 -3.52 Financial – Diversified
149 AIG – American International Group AIG 33.94 27.06 6.88 Financial – Insurance
150 Freddie Mac (Federal Home Loan Mortgage Corporation) FMCC 29.47 33.11

Change management,embrace it and SUCCEED !

Change management is a structured approach to shifting/transitioning individuals, teams, and organizations from a current state to a desired future state. It is an organizational process aimed at empowering employees to accept and embrace changes in their current business environment.

Examples of Organizational Change


  1. Missionary changes – Laser specific Mission.
  2. Strategic changes – The “HOW” to get there .
  3. Operational changes (including Structural changes) - Proper Market Alignment.
  4. Technological changes - To bring Your value to the forefront.
  5. Changing the attitudes and behaviors of personnel - Making sure the right people are in the right positions.

As a multidisciplinary practice that has evolved as a result of scholarly research, Organizational Change Management should begin with a systematic diagnosis of the current situation in order to determine both the need for change and the capability to change. The objectives, content, and process of change should all be specified as part of a Change Management plan.

Change Management processes may include creative marketing to enable communication between change audiences, but also deep social understanding about leadership’s styles and group dynamics. As a visible track on transformation projects, Organizational Change Management aligns groups’ expectations, communicates, integrates teams and manages people training. It makes use of performance metrics, such as financial results, operational efficiency, leadership commitment, communication effectiveness, and the perceived need for change to design appropriate strategies, in order to avoid change failures or solve troubled change projects.

Successful change management is more likely to occur if the following are included:

  1. Benefits management and realization to define measurable stakeholder aims, create a business case for their achievement (which should be continuously updated), and monitor assumptions, risks, dependencies, costs, return on investment, dis-benefits and cultural issues affecting the progress of the associated work.
  2. Effective Communications that informs various stakeholders of the reasons for the change (why?), the benefits of successful implementation (what is in it for us, and you) as well as the details of the change (when? where? who is involved? how much will it cost? etc.).
  3. Devise an effective education, training and/or skills upgrading scheme for the organization.
  4. Counter resistance from the employees of companies and align them to overall strategic direction of the organization.
  5. Provide personal coaching (if required) to alleviate any change related fears.
  6. Monitoring of the implementation and fine-tuning as required.
  7. Hiring Dixon Judd early on will provide the “Best Case” for your company.

Management consulting

From Wikipedia, the free encyclopedia

Management consulting indicates both the industry and practice of helping organizations improve their performance primarily through the analysis of existing business problems and development of plans for improvement.

Organizations hire the services of management consultants for a number of reasons, including gaining external (and presumably objective) advice and access to the consultants’ specialized expertise
Because of their exposure to and relationships with numerous organizations, consulting firms are also said to be aware of industry “best practices“, although the transferability of such practices from one organization to another may be problematic depending on the situation under consideration[citation needed].

Consultancies may also provide organizational change management assistance, development of coaching skills, technology implementation, strategy development, or operational improvement services. Management consultants generally bring their own, proprietary methodologies or frameworks to guide the identification of problems, and to serve as the basis for recommendations for more effective or efficient ways of performing business tasks.

How does Your company rank compared to Your top competitors?

If you have ever asked yourself or wondered then you are not alone.We measure many facets of our business with precision BUT when it comes to knowing exactly how our company compares to an ever increasing number of hungry competitors we too often have to guess.

The Fortune 500 and even 100 Companies would never leave this to chance, there is far too much at stake. Performance Resource Group’s CEO, Dixon Judd states” It used to be one of the first questions a potential client company would ask me,“How do we stand in our value proposition in the market place?”

Now there is a solution. Having a “Competitive Market Analysis ”  of our top 25 competitors gives our company a strategic advantage that the competition is left to second guess about. This saves us thousands of dollars of precious capital and allows us to focus on tangible improvements as we grow.

Dixon Judd has become the respected resource that companies turn to in obtaining this vital data.

For an in depth consultation to see just how your company is prepared to meet the ever increasing competition; Contact Dixon Judd at

Competitive Market Analysis

Topic: Business Planning

No matter how much you think you know about your competition, no matter how much experience you have in your chosen field, without a clear understanding of the market for your business you might as well be driving blind. Big companies spend tens of thousands of dollars to conduct competitive market analysis .


Competitive market analysis is important at every step of your business’s development.  Whether you’re trying to choose a businesswrite a business plan, or grow your business, research is absolutely vital to making informed decisions.  The key things you need to learn about your market and your competition include:


  • Who are the major competitors in the market?
  • What’s their current share of the market you’ve identified?
  • Have there been any significant changes in the market share each competitor has had over the past five to ten months (i.e. who’s moving up and who’s moving down)?
  • Which of your competitors address which segments and which of them are strongest in those segments?
  • What are your competitors’ strategies for reaching your target market, as well as any segments on which they focus?

Now that you know the types of questions for which you’re seeking answers (and there are many more, but these should get you started), here are some pointers for how to get those answers without spending a fortune:


Check out the competition in person

The simplest place to start is by visiting other businesses in the same line of work as yours. See what works and what doesn’t work. If possible, talk to the staff and the customers. Find out what people like about your competition, and what they’d like to see done better, and take lots of notes!  You might just find the perfect business angle or differentiator by learning what your competitors aren’t doing right or what their customers wish they were doing.


Research competition online

The internet opens up a vast resource for competitive market analysis – search for your type of business, your competitors’ names, your product or service, and just about anything else you can think of related to your business. Peruse your competitors’ websites to get a feel for what they are doing and what their prices are. Many of their sites may also have a newsroom section with recent press releases and news stories, which could tip you off to recent trends and developments in your industry.


Join a trade association

You may already be considering joining your industry’s trade association, and we’ve got one more reason for you to take the plunge: Trade associations generate a lot of data on their own industries. Check with your association to see if they offer access to such data as one of the benefits of paying your annual membership fee.


Consider purchasing reports from the pros

Once you’ve identified all the information you can obtain for free, you may want to consider paying a few hundred dollars for a more specific research report. Professional companies such as  Performance Resource Group,Forrester Research, Gartner Dataquest,, Hoover’s, and Dun & Bradstreet, can compile very useful information that meets your specific needs.


Our Bottom Line

The more information you have about your industry and competitors, the easier it will be for you to make smart decisions to build your business. Do the legwork yourself and save some cash by:


  • Observing the competition in action
  • Exhausting free online research options
  • Accessing government research
  • Obtaining research from your industry’s trade association
  • Visiting a local library or university
  • Purchasing reports from market research pros

And remember, competitive market analysis will benefit you throughout the life of your business, so these are tips you can use again and again.

The Five Hallmarks of Highly Respected Achievers

I’ve been working on a research project for a few weeks that involves identifying the characteristics that describe highly driven, achievement-oriented people who are also among the most well-respected in any organization. The intersection between drive and respect is an important one, because we all know people who are highly driven but think nothing of running others over along the way. And, we know examples of people who are respected but stagnant.

What follows is a taste of things to come, but here are a few initial thoughts on what makes respected achievers different.

1. Tempered Tenacity

Respected achievers are incredibly tenacious. They do not allow obstacles to stop them, at least not for long, chiefly because they’ve trained their thinking to immediately seek out other ways of reaching a goal. To a tenaciously driven person, there is never just one way to get there, and no one will convince them otherwise.  However, the sort of achiever we’re talking about also keeps the well-being of others in mind, and if one of those alternate routes will result in unnecessarily harming someone else, then that route isn’t an option, period. To the respected achiever, it doesn’t have to be, because they know there are other ways to get where they want to go even if it takes longer to get there.

2. Consistent Commitment



Another hallmark of respected achievers is that they do what they say they’ll do. They don’t spin out an elaborate vision, get others to buy into it, and then run off to the next big idea because it has sparked their interest more than the first. While nurturing multiple visions is fine (assuming they are manageable), the respected achiever sets a high standard for her/himself that what they commit to do on a project, they fully intend to do and will make every reasonable effort to make it happen. Granted, failure or unforeseen circumstances are always a possibility, but those are the exceptions. The respected achievers’ standard of following through is consistently maintained whether or not adversity materializes, and others know that when they collaborate with a respected achiever it won’t be a waste of their time.

3. Soulful Pragmatism

Respected achievers are typically pragmatists – they focus on what works. If one approach isn’t panning out, they either figure out how to tweak it in subtle or significant ways, or they abandon it altogether and adopt a different approach. Their focus is on outcomes. But, implementing a pragmatic approach without being mindful of how changes will affect others isn’t commendable, it’s cruel. Respected achievers know this, so they balance an outcome-focus with a situational awareness of the adjustments required by others, and they work with them to make those adjustments. Again, this may build a little more time into the process, but respected achievers don’t value outcomes above peoples’ lives if there is any possibility of creating a mutually beneficial arrangement. And if there is not, they take it as a personal goal to help others transition into roles that will benefit them.

4. Strategic Resolution

Just like anyone else, respected achievers can become negative when things aren’t going well, and just like all of us, they may vent now and again about how crappy a situation is.  What they do not do, however, is drop anchor in that negative place and allow their negativity to feed itself and eventually seep into the perspectives of those around them. Instead, they experience the pain, recognize that whatever caused it (business or personal) is now part of their repertoire of experience, and then they resolve to strategically move on.  In this case, strategy refers to a guiding set of action steps to push forward – and, it also refers to decisions about what not to do.  Strategy is choice, and resolving into a strategic mindset to pull out of a negative place requires making hard choices. Respected achievers are seen by others as those willing to make those choices, and that carries tremendous weight in any organization.

5. Responsibility Ownership 

One less-than-admirable trait of many driven people is that they’re good at figuring out how to avoid taking responsibility for what went wrong. If that means throwing someone under the proverbial bus, so be it. Better him than me. But the respected achiever sees things differently in a couple of ways. First, if something went wrong due to a mistake made by the team, the respected achiever owns responsibility whether or not other team members do the same. Why? Because teams are essentially organizations structured to accomplish specific goals, and if those goals aren’t reached, then the team (not any one person) owns the blame, because the team (not any one person) was given the responsibility to succeed. Respected achievers own their role on the team instead of trying to explain why their responsibility should be less than that of the others’.  Second, respected achievers are intuitively reciprocal people – they treat others in the manner they wish to be treated. Their embodiment of the “Golden Rule” is not situational; it’s a consistently applied maxim that guides their behavior.David DiSalvo

Is $250,000 really middle class?

How is it that a quarter-million dollars of income has come to represent the dividing line between the middle class and the wealthy?

By MSN Money partner 4 hours ago

This post comes from Alicia Munnell at partner site SmartMoney.


SmartMoney logoIt seems as though no one reads the Census Bureau’s annual publication “Income, Poverty, and Health Insurance Coverage in the United States” for anything but the number of people in poverty. The parts I find most interesting are those pertaining to the level and distribution of income. The numbers go to the heart of conversations about the “middle class” and the “rich.”


Couple stood outside of villa © Image Source, Image Source, Getty ImagesBoth President Barack Obama and Gov. Mitt Romney have adopted household income of $250,000 as a meaningful demarcation point for defining the middle class. In the case of the president, he proposes to retain the Bush tax cuts for households with less than $250,000 and eliminate the tax cuts for those above that threshold. Romney, in a recent ABC interview, offered the same definition of the middle class: “Middle income is $200,000 to $250,000 and less.”


Where does this concept of $250,000 as the appropriate cutoff come from? According to the data in the Census Bureau report shown in Table 1 below, which presents the thresholds for being in different parts of the income distribution, the median household in 2011 had an income of $50,054. A household with an income of $143,611 was at the 90th percentile point, or in the top 10th of the income distribution. A household with an income of $186,000 was at the 95th percentile, or in the top 5%. The table does not even show households with $250,000, but they must be in the top 97th or 98th percentile.


Table 1. Household Income at Selected Percentiles, 2011

Percentile Dollar limit
10th $12,000
20th $20,262
50th (median) $50,054
80th $101,582
90th $143,611
95th $186,000

Source: U.S. Census Bureau, “Income, Poverty, and Health Insurance Coverage in the United States: 2011.” Table A-2.


The thresholds must be interpreted with caution, because households include old and young, urban and rural, coastal and midland, and small and large. But it is very hard to understand how anyone could think of $250,000 as the middle. It seems as if both candidates have a mental picture of the very rich and everyone else.

The “very-rich-vs.-everyone-else” framework may come from data on the share of income earned by various households. Here the census data show that those in the top quintile – the highest-earning 20% – earn more than the bottom four quintiles combined (see Table 2). That is, the top 20% receives more income than the bottom 80%.


Table 2. Shares of Household Income by Quintile, 2011

Quintile Share
Lowest quintile 3.2
Second quintile 8.4
Third quintile 14.3
Fourth quintile 23.0
Highest quintile 51.1

Source: U.S. Census Bureau, “Income, Poverty, and Health Insurance Coverage in the United States: 2011.” Table A-2.


And a recent study by economist Emmanuel Saez shows that within the top quintile the distribution is also very skewed, so that the top 1% receives about 20% of total income.


Thus, while the $250,000 threshold makes no sense in describing the middle class, it seems like a relevant divide for defining where the money is. Nevertheless, dividing the nation’s households into the “wealthy” and “the middle class” doesn’t seem like a useful exercise. It pits the majority of Americans against the top 1% or 2%.


It suggests that the majority of Americans should not be called upon to solve the nation’s fiscal problems. It violates the notion that we are all in this together. Yes, the rich can contribute more, but we can all contribute something.


More on SmartMoney/MarketWatch and MSN Money: