Friday, April 24, 2009
Going All Political on Your Ass
So you may have guessed that the last two posts were actually written by my ghost blogger ;) I have been so busy with work (yay!) and going here that I haven't had much of a chance to write lately. So today I'm going to open up the floor for discussion. Topic: higher tax rates for the "rich." It is currently under debate in Washington as to whether or not families with combined incomes of over 250K per year should receive a tax hike of, I believe, about another 5%. I ask because #1 I hope to be one of those families some day and #2 because I currently make a pretty decent living (nowhere near $250K a year but a lot more than the median income in the US) and I already pay over 30% of my paycheck in various taxes. The tax hike is intended to affect those families who are considered to be in the top 5% of earners in the US, but, personally, I feel that $250K a year (of a combined family income) doesn't really make you rich. When I think of rich, I think of people making more like $25 million a year. I might make what seems to be a good deal of money, but I only take home 70% of what I make. I have five children to support with daycare, health insurance and college to save for. I also have ageing in-laws with health problems and no savings to speak of. I will likely have to begin supporting them some time in the near future. I've not fully formed an opinion on this matter myself yet because I am of two minds, and I am really curious to hear what the people I care for most have to say on the subject. Okay, I'm getting verklempt, discuss amongst yourselves...
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5 comments:
Does it change your mind if the family making $250K is two people and a child with no other dependents? I think that the way the tax burden is currently structured places a lot of it on the shoulders of the (dwindling) middle class. What is fair? According to Alexis, in the Netherlands once you make a certain salary you are taxed at something like 50%! BUT. They have centralized health care and no homeless people. So there you go. It is all about society's values. Here in the US we are all about worrying about ourselves, not the rest of our population. Whether or not you think that's right or wrong is up for debate, there are certainly downsides to every situation. But I do strongly believe that, at least with our current system of taxation, all people should be taxed proportionate to their income. And that you definitely shouldn't get a break because you make MORE than others.
Considering the amount of debt that individual Americans have, 250K doesn't seem like a lot, but in all actuality, less than 2% of Americans are actually earning 250K a year...small business owners included.
(Myself included) I think educated Americans who earn a comfortable salary have a hard time relating to the majority of society that has zero or less disposable income.
We tend to look up at those making more than us (the CEO, the PhD, Oprah...)with out considering those working for us or working to support us. (ie the guy at the gas station, the girl at the grocery store, waitresses etc) They might have fancy shoes and a cute car, but I almost guarantee you they don't have disposable income.
Hmm, getting taxed more for making more creates a disincentive to make money doesn't it? If my marginal tax rate is 50-60%, why would work that extra hour to make anymore money? Whereas if I'm taxed at a lower level, I might work more and end up paying more in taxes, but keeping more money on the marginal dollar I make.
A number like $250k sounds pretty low. If it were closer to $400k or so, I'd feel better about it. Those people in the $250k-$400k do A LOT for our economy including starting businesses.
So I'm not happy about a tax increase on two relatively successful people who are married. At only (yeah, "only") $125k a year per person, that's a big bump in taxes and I can't say it's justified.
Who lost the most money recently? Those making a combined income of over or under$100k? Without a doubt, it's those who make MORE than $100k a year because they were in the stock market. So to now screw them with teh tax burden, that sucks. Cut government spending now that the banking crisis is over (mostly).
Even at the 100K range, you're talking about less than 15% of the population.
I agree it's not the best idea to tax that 15 % (we're assuming the 'poor' rich are marrying the 'poor' rich.) It's incredibly likely that most someones making a 6 figure salary has an advanced degree of some sort. That's 60-100K in student loan debt on top of probably a 300K mortgage, 35K car (to be modest) etc etc.
At the same time, Obama was pretty clear he planned on taxing the "rich" when he was running. People might have been too taken by his smile to have actually heard him say it many times, very clearly.
Assuming gov. cuts spending (which they already are) the first things to go are always education and Government jobs.
That leaves Nikki out of a job ; ) staying at home trying to educate 5 kids....not so much fun.
I say if your gross income has 6 figures and your lover is also so lucky, count your blessings, start donating like crazy and start dumping your money into an IRA, so you don't have to pay taxes on it.
I would only add that people with money can hire good accountants. Also here in the NL I would definitely say the high income taxes influence people in their work performance - but also spending. So it works both ways. I would say if the money was well used (bike paths!) it seems worth it.
that is of course a whole other can of worms!!
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