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VALUES DEFINE MIDDLE CLASS, GINGRICH SAYS

SHARE VALUES DEFINE MIDDLE CLASS, GINGRICH SAYS

Middle-class Americans should be defined by their work ethic and core values, not by how much money they take home, says incoming House Speaker Newt Gingrich.

"I think it's a state of mind, and this is where frankly some of my liberal friends just don't get it," the Georgia Republican said Tuesday on CNN's "Talk Back Live."Defining who belongs to the middle class has become a hot political issue as the Clinton administration and the Republican leadership in Congress argue over who would be eligible for a middle-class tax cut both sides support.

President Clinton, in his tax-cut plan unveiled last week, spoke of providing a tax credit for the children of households earning up to $75,000.

The "Contract With America" agenda promoted by Gingrich would give tax credits for children in families earning up to $200,000.

According to the most recent data available from the IRS, 93 percent of the returns it received reported income of under $75,000. Fewer than 1 percent reported income of $200,000 or more.

Gingrich defined the middle class as "that group of Americans who work for a living, who want to save, who believe that they want their children to have a better future, who are prepared to postpone immediate gratification to try to give their kids a better future, who believe in studying and doing their homework."

"It's a psychological, not an economic figure, and I think the minute you start putting numbers in there it gets very weird," he said.