A $400,000 annual income is ~$33,000 a month. It is ~$7500 every week. And it is $1100 per day.

[RadiationTherapy]

Those numbers are huge. The implications of such an income in terms of security, influence, and power are tremendous. The fact that there are incomes that are orders of magnitude larger than $400k per year does not - to me - diminish the fact that $400k a year is a Big Fucking Deal.

[hobbit709]

1. I don't get $1100 a MONTH from SS.

[RadiationTherapy]

2. My blind dad: $1000/month. My disabled cancer-surviving super-brother: $875

Thanks, Uncle Sugar!!

[hobbit709]

6. It makes me want to take any of these whiners by the throat, slap them into last week

and throw them into the nearest alligator pit when they whine about how tough it is for them.

[randys1]

3. According to tens of millions of Americans who make less than $4000 or $5000 a month, the problem is

the rich dont have enough, the rest of us have too much.

Otherwise Scott Walker, Rick Scott, etal (list the hundreds of statewide or nationwide republicans in power here) would not be in office.

Not ONE of them.

[Orrex]

5. Quite a few on DU are quick to insist that $250K per year isn't that much.

Funny how the wealthy always seem to have hordes of advocates, but the impoverished must fend for themselves...

[randys1]

7. Well it isnt if you live in San Francisco or NYC, maybe....

But that isnt what is important, what is important is reversing the entire system.

It is disgusting that you can afford to live in NYC and I cant (if that were our situations financially)

Or that you can buy (as the koch bros will do if teaparty takes power) Yellowstone and Waikiki Beach and turn it into your own private play area where nobody but you and your friends can go.

Capitalism has become a system now where the people with the money can guarantee they will never run out and guarantee we will NEVER have any unless we hit the lotto or invent something that almost nobody every will or does.

[WestCoastLib]

10. There are plenty of places where it isn't

As the post above me stated, if you live & work in places like NY or SF, it can cost upward of 5-6,000 per month to rent an apartment in the city.

Don't forget that Cost of Living is adjusted to meet the needs of the people that are working there (indirectly and directly). So, while 250K may been seen as an outrageous amount of money to make in a rural town in which rents are in the 800-$1200 range, in a city in which common salaries get to be as high as you are looking at, everybody from building owners, to coffee shop owners, to grocery stores, to utilities, simply charges more.

[hobbit709]

11. And median income in NYC according to the Census Bureau is $58,000

[stevenleser]

29. Which doesnt work well with a median apartment price of $3000/mo. However...

http://newyork.craigslist.org/search/aap

There are apartments to be had for much cheaper. Key is, they are ever further from the center of the city meaning your commute is worse, and the more you head out from the center, the fewer mass transit options there are.

In Brooklyn and Queens in particular, you can see from this below map there are large areas where it is not close to a subway stop, meaning if you are commuting to manhattan for work, you will need to take a bus and then at least one long subway ride just to get into manhattan and then perhaps another subway or two to get to your job. That puts your commute time at 90 minutes each way minimum for many of these folks.

[B Calm]

41. +1000 People with higher incomes have trouble with facts!

[fishwax]

47. nah, even in NYC 250,000 is a lot

most families in NYC don't make anywhere near that. And the city is plenty liveable on 250k a year. Yes, rent is expensive, and yes the space will be smaller per dollar than elsewhere, but that's the tradeoff of living in the city. And at 250k/year, 5k per month is still lower than 25% of one's salary, so it isn't an outrageous expense, relatively speaking. Most families who make much less (and even in NYC that is most families) pay much more of a share of their income for rent.

[Gormy Cuss]

55. Ditto for San Francisco.

You can't live anywhere you want but there are plenty of options available for households with that income. You may not LIKE the options, but there are options like not living in the city but near enough to commute.

[Hoyt]

12. It's enough to withstand a a tax increase for the cause. Although, don't expect that to

raise enough to make a big difference in most of our lives, assuming it actually gets redistributed to those who really need it.

$250,000 is about average for a doctor. If it's a joint return, there are a number of professional couples making $250K a year. And, most of them work hard for it. But, according to the IRS, only about 3% of tax returns -- out of 140,000,000 -- are for incomes over $200,000. So $250K would even be less.

Point is, taxes alone on folks above that income are not going to produce enough tax revenue to do all the things we want -- education, health care, better safety nets, etc. It's definitely a start, but it's going to take other things to make a significant improvement.

[GeorgeGist]

18. Surprisingly they use to.

[hifiguy]

30. Well, those were the days when corporate taxes

provided around 30% of government revenue instead of the 5-7% they provide today.

When a corporation like, say, GE, can make billions in profit and get a billion-dollar tax refund on top of it, something is more FUBAR than can be described.

[Igel]

92. No, they didn't.

Taxes as a percentage of GDP haven't changed all that much.

Our memories are distorted. We remember some social service programs that were high visibility and are now reduced, or we see that some things that aren't as well funded aren't (but some of those had state funding). Medicaid and Medicare were much smaller, education and some other programs were smaller. The ACA is supposed to "save" money and keeps coming in under projections, but the savings are against projections and constitute an increase in absolute spending. All those little annoying details matter, and matter a lot. In short, while the total collected as a percent of GDP hasn't increased much, the demands made on that amount are vastly higher. Since there's not enough to go around, everybody's frustrated.

The rise in the '90s in the following graph was because of the stock market, mostly; the slump in in 2009 was recession, and the reason for the slow rebound had a lot to do with "stimulus", both Bush and Obama era.
https://research.stlouisfed.org/fred2/series/FYFRGDA188S

The real point in this graph is simple, and could be shown as well with household income tax instead of total receipts: the high tax rates are marginal, and don't affect all income; a lot of income when there are really high marginal rates becomes sheltered. We had large private trusts established in the '20s through the '50s because of the high tax rates; now, not so much. The effect was the same: to reduce the personal income tax rate to about the same, regardless of the marginal tax rate. The Alternative Minimum Tax was intended to avoid this effect, but all it did was force accountants and the wealthy to be more creative when it came to protecting their assets.

Oddly, when the tax rates went down receipts only dropped for a couple of years. There's a certain level of taxation that people accept as reasonable; if it goes too low, they stop sheltering their income. If it goes too high, they shelter their income in more clever ways. That number is around 18-20%. It takes 2-3 years to adjust tax strategies, so increased marginal rates do result in increased revenues ... for a few years.

This has been dubbed "Hauser's law". Whatever. It's still a fairly accurate portrayal of how things washed out, whatever the changes. It's been pointed out that this masks a decline in corporate taxes and an increase in SS taxes. Nonetheless, they're all federal income taxes--some are earmarked a priori and some aren't, and where the tax is paid may vary but the amount paid doesn't vary much.

State revenue's increased. You can go to http://www.usgovernmentrevenue.com/revenue_history and look at the nifty graphs there (watch out, they include projections for the next 5 years, and they're about as reliable as a 3-legged horse in the Preakness). This is not a US gov website, however.

[Warren Stupidity]

17. Funny how this argument starts sliding down the income scale searching for victims.

Let's try this: Quite a few on DU are quick to insist that $100K per year isn't that much.

Anyone else want to bid?

The goal is to get the peasants fighting each other, calling each other rich bastards, while the plutocrats sit back and enjoy the show.

[Orrex]

21. I could live very comfortably on a peasant's $100K salary

If, in your view, the difference between a $100K lifestyle and a $250K lifestyle is equivalent to the difference between a $250K lifestyle and a $400K lifestyle, then the slippery slope that you're proposing might conceivably make sense, but I doubt it.

Barring catastrophic medical expenses, the person who can't scrape by on $250K per year doesn't deserve $250K per year, whether peasant or plutocrat.

[haikugal]

128. I wouldn't know how to act on that much money! nt

[BainsBane]

32. $100 k is the upper 20 percent

Last edited Tue Jul 14, 2015, 01:24 AM - Edit history (1)

My problem with the construct of the 99 percent is it masks profound class differences. It can serve as a way for the upper-middle class to impose its own interests on the poor. The difference in life experience between the lower 10 percent and that 250k, which is upper 2-3 percent, is HUGE, greater than that between 250k and the 400-500k that puts someone in the 1 percent.

My own income is close to the national median. The difference in my lifestyle now compared to when I was in the lower 5-10 percent is ENORMOUS. The 99 percent are not all the same, not even close.

[Orrex]

38. ^^That

[lumberjack_jeff]

50. If $100k is middle class, then so is $25,000. Equal number of households above and below.

https://en.wikipedia.org/wiki/Household_income_in_the_United_States

It's entirely subjective - which demographic groups are we trying to help? If your answer is everyone under $25,000, then 80% of the households above that are available to provide that help. If your answer is everyone under $100k then only 20% of households are available to finance it.

Households making $100k are not peasants, and given that they're the top quintile of incomes, I'd argue they aren't middle class. They're the people who enjoy the american dream.

[daleanime]

70. The resources hoarded by the .1%.....

would go a long ways towards helping more then just the bottom 20%.

[Igel]

93. You're shifting from income to wealth.

There's a very real difference. Wealth is not renewable and it's not a constant flow. You tax it, it's reduced for good. Running a country on the liquidation of wealth is, ultimately, foolishness. It's been tried; it's failed each and every time, because treating assets as revenue just draws down savings and assets. After 10 years or less, you're down to zero and then what? You have a population used to that revenue who, historically, would wind up pretty much back where they were and that's politically unacceptable. The only thing you think you've handled is inequality, but people still resent those who were wealthier and tend not to believe that their assets are gone; you've fed people a steady diet of vengeance and resentment and they're not happy when there's nothing to resent, so they keep on resenting, but now resent what's been taken away.

At that point things seriously go to pieces.

[daleanime]

115. What shifting? That's simply identifying the problem....

although it's rather silly how you look at taxes like they are some kind of black hole, sucking in "wealth" that never returns.

If the tax money was never spend, then that might possibly be true, but that just the point. It gets spend on needed services and then it's back in the economy creating jobs. Rather then sitting off shore creating a 'wealthier' single person, let's get more of it put to work for all.

But, we are not going to agree, are we? So have a lovely evening.

[Warren Stupidity]

76. Any household with income more than $57,658 is in the top 40%.

I'd argue, using your argument, that they aren't middle income either.

See how this works?

[lumberjack_jeff]

83. Yes. That's exactly how it works. You have your opinion and I have mine.

Politically and mathematically, it's important to not alienate more voters than necessary.

But the biggest problem is that, because households are tracked by income and not net worth, we treat the oil field welder making $120k and the trust fund "artist" collecting $120k as the same thing.

[Depaysement]

58. + 1

Spot on. An excellent post.

[ohnoyoudidnt]

134. DING!

I have no doubt people making 20K a year would love to be 200k or even 400k, but those are NOT the people fucking shit up. No one making less than 400K is dictating terms of the TPP.

[BainsBane]

25. That's insane to me

That is about the upper 3 percent. I find it amazing when people who make that much rail about the 1 percent because they aren't that far from it. The median household income is around 50K a year. That is for an entire household. 100k a year is upper 20 percent. $150k a year is upper 10 percent, and $195 is upper 5 percent. The 1 percent start between $400-500k a year.


ETA: Here's a chart


http://blogs.marketwatch.com/encore/2014/10/02/incomes-are-much-lower-than-you-think/

[lumberjack_jeff]

51. +1 for math. n/t

[Depaysement]

62. "they aren't that far from it."

I guess to know them is to hate them.

[BainsBane]

64. Meaning?

Do you know what the income level is for 1 percent? Tell me why 2-3 percent is so different from 1 percent, and how the poor have sooo much in common with those struggling to make ends meet on $250k a year? Clearly, I have no idea what it means to suffer under the weight of all that money.

[Depaysement]

73. Ok, you didn't get it

My bad. It was an observation that the 3% are so close to the 1% that they hate them. They are often their "faithful servants" so they that means they eat their shit.

But did you really need to go on the attack? I sometimes disagree with you but from your posts, I actually think you are quite intelligent and interesting.

[BainsBane]

81. Sorry for the misunderstanding

And thank you for your kind words.

[Depaysement]

94. No apology needed

The words weren't kind, just true.

[Thinkingabout]

77. Good chart. I see a lot of complaining about the 1% and even if they paid a flat tax rate

It would not be able to run most if the programs many would like to see in place. The number who has high incomes is small. Yes I am thinking a flat tax would at least get some paying more in taxes but it sure isn't enough to pay off the national debt.

[krawhitham]

130. +1

[philosslayer]

45. If you make $250k per year you are well off

You are hardly wealthy. Especially if you have a couple of kids in college. I can speak from personal experience on this.

[MattBaggins]

52. No you are wealthy at 250K

[philosslayer]

82. Then what is your definition of "wealthy"?

I have to get up and work every day. I drive an 11 year old car. I don't have a big house. My assets aren't such that I can stop working.

Wealthy means you've got your "fuck you" money. Well off means you make a good wage, but you're still a wage slave. I'm a wage slave.

[ohnoyoudidnt]

133. 250k a year doesn't mean "fuck you" money.

OMHO, "Fuck You" money means you don't have to work another day in your life and can live a very well until you die. If I gave you $250K right now, I doubt you could live the rest of your life in good comfort without having to do any work whatsoever. A million or two in the bank is fuck you money. Of course, that would still require making sure it is properly invested.

[B Calm]

147. If I was making $400,000 per yr, it would take me 3.5 years to save enough fuck you money

to retire very comfortable. I would then invest into a safe income fund and draw maybe 5% or 6% income and sit back and still watch my money grow.

[lumberjack_jeff]

53. The fact that you're distributing it to your kids is immaterial. It's still wealthy. n/t

[Major Nikon]

88. To me, wealthy means you have wealth

There's no shortage of people who make that much and leveraged up to their eyeballs.

The flip side is I also know people who make less that I would consider wealthy because they have saved enough to retire early and live comfortably.

[Adrahil]

71. I'm scraping the top 5%. I'll give my useless opinion....

I am wealthy, but not truly "rich." I live in a nice house. I drive nice (if aging) cars. I do not live in the lap of luxury, however. I still have to consider purchases, plan carefully for retirement and the kid's college.

The main luxury I indulge in is a nice vacation every other year. The other main luxury is that I'm not one disaster away from bankruptcy. If the car breaks down, I can fix it. If anyone needs dental work, or braces, I can write a check.

Having grown up working class and seeing my parents struggle to figure out how to repair the car and pay bills, I do understand what a luxury that is. My wife grew up upper middle class and admits she sometimes takes that for granted.

[Xithras]

69. Whether or not $250k is a lot of money depends on a lot of things.

- What are the costs to earn that income? In many fields, you may have to spend $100k a year to make $200k. Ongoing educational expenses, professional memberships, facilities overhead, insurance costs, etc., can quickly whittle $250k down to a much smaller pool of spendable cash. The costs can come from all sorts of unpredictable sources too. I once knew a guy who wore suits to work every day and never wore one that cost under a grand. Why? Because his clients were all rich guys who wouldn't take you seriously if you showed up in a cheap suit. He made a couple hundred grand a year, but HAD to put on all the pomp of the wealthy just to keep his business up and that money coming in.

- How long is that income good for? This is really where the balance of wealth vs. income comes into play. There are a LOT of fields where you can make a LOT of money relatively quickly, but not for a long period of time. It's a game of math. Who is wealthier? The remote oilfield worker who pulls in $300k because of danger pay, but can only do it for a half dozen years before his career is done? Or the office worker who makes $50k steadily over a 25 year career?

- Where does that person live? This REALLY DOES matter. I used to live in San Francisco. I make over $100k a year today and live pretty well about an hour east of the Bay Area, but I could barely afford to live in the city on that same income today. My skills are portable enough that I chose to take them to a cheaper area, but not everyone has that luxury. $100k a year is a small fortune in Omaha, but barely puts you above poverty level in Manhattan.


This is why debates over money and class should be limited to wealth, and not income. Income is relative, temporary and fleeting, and can shift with the economic climate, your health, or even the misbehavior of your coworkers. One bad day can end your job and take your income with it. One bad week on Wall Street can wipe out the incomes of thousands, or even tens of thousands, of Americans. Wealth, on the other hand, is accumulated capital and exists whether or not you have a job. Wealth is power. Wealth is the true dividing line between the classes.

[Igel]

91. There are lots of advocates for the poor.

But, just like the rich, most people still have to fend for themselves.

[a kennedy]

105. and it was so hot today they opened shelters for the homeless and when more people came

to get out of the heat.....the folks that came in a couple of hours earlier, were told they had to get out. Our city doesn't have a place for our homeless families to get out of the heat, and for that matter to get out of the cold in Winter. What the hell is wrong with this city that can let this happen?

[tymorial]

110. It all depends on your mortage and your debt

I don't make nearly that much but depending on where you live, you may not be able find a home for under half a mil and we're not talking mansions here.

[Orrex]

124. I simply don't believe that, absent strong supporting evidence

Because sure as shit there'll be a house within a few miles that costs a fraction of that ludicrous sum. Further, even if the house is half a million, the $400K/year salary could pay it off in four years and still leave $150K per year for living.

[tymorial]

141. I wasn't responding to you.

[Orrex]

142. Oh. Well. Um.

Yeah!

[tymorial]

143. lol

my responded didn't make it in. just my title sorry about that.

It really does depend on where you live. I live outside Boston and the home I rent lists for 650k. This is a simple raised ranch. My wife and I know the land lord and he has given us a deal. We don't make anywhere near 250k a year though we do okay. My wife could probably find a job elsewhere but she is in the worst industry for women... construction. She has been with her company for 9 years now and she is just now starting to get somewhere in regards to her career. Sure we could move and find cheap real estate to buy a house but she would have a hard time finding a job that gives her the respect and salary she deserves. I am a consultant so I can work anywhere. She makes more than I so we stay for her. This house was paid off a long time ago and we know the landlord so we get this place at a steal. He could easily rent this place out for a couple grand more a year. Even still, with the cost of living around here, oil, healthcare costs related to fertility treatments... it is all about what your bills are and where you live. I spent a month in New Orleans a couple of months ago for business. Our client had an apartment that we rented for the month with furnishing. The same place here would go for far far more. Even the groceries were cheaper. its all about where you live.

[laundry_queen]

114. I always forget

how many rich people are on DU until one of these types of thread pops up, then they all come out whining about how hard they work and how what they make isn't that much.

~signed, a single mom of 4 with a degree who makes a bit over 1/10th that figure in your title.

[Orrex]

123. You should get more training and repurpose yourself and look outside your comfort zone

Any of those sound familiar?

In my entire life I've never heard a single word of financial/career advice that didn't boil down to "well, you should simply have more money."

[laundry_queen]

132. OMG

LOL, I'm sorry I have to laugh because i know what you are saying, but if they knew how far outside my comfort zone I had to go to get my degree and job....My husband left me and I had to pick up, move, become a full time student (With a bunch of teens and twenty-somethings) in a program where we spent a lot of time public speaking and doing presentations...I moved 3 times while going to school, had to live with my emotionally abusive parents, then when I finally got my own house, and graduated (with distinction) I got a job which I thought would be just something to do until I got a better job (got this job thanks to a friend) and at that precise moment the local economy went belly up. I guess I should be thankful I have any job at all, hey?

Yeah, at 40 I don't think I'll be doing that again. I'll stuff my 4 kids and I in a studio apt first. (ETA...I? Myself? erg. Maybe I need an English degree.)

[raccoon]

137. Right on. nt

[Orrex]

4. I could probably make it through the weekend on that paltry sum.

[closeupready]

8. Yeah, sounds like a lot, but what's left after nannies are paid,

gardeners, dog walkers, country club dues, and marina fees? Huh? So there you go, it really isn't much at all. We are all one paycheck away from .... from .... DESTITUTION!

[MADem]

9. Many people are thrilled to get along on one tenth that amount.

[jwirr]

13. I get $9828 a year including food stamps. Like to see the one who gets that $400,000 try to live on

that.

[SamKnause]

14. $1,100.00 per day.

Last edited Tue Jul 14, 2015, 12:58 AM - Edit history (1)

I live (barely survive) on $1,082.00 per month. (SSDI)

People, like me on disability are living high on the hog.

If I received $2,000.00 per month my financial problems

would disappear.

That is about what I made at my highest paying job.

That is after all taxes and deductions.

It is a real shock to have your income cut in half.

[RadiationTherapy]

15. My father and brother both survived life-threatening illnesses and are disabled.

Their paltry disability payments shoved them to the margins of society long ago. It is painful to watch and is financially difficult for those of us who love them. I hope you are ok and I hope for a better future than the wealthsplaining status-quo'ers are promising.

[SamKnause]

16. I live moment to moment.

I don't see my situation improving.

I see major austerity policies on the horizon.

Thank you for caring.

I am sorry that your father and brother are in the same boat.

No one should have to live like this.

[RadiationTherapy]

26. My brother and I turned to art.

I know not everyone has the time or resources, but it has meant a lot to us.

[hifiguy]

34. Eat the rich!

The poor are tough and stringy.

[JoePhilly]

19. And so we should do what exactly?

[RadiationTherapy]

22. I'm just doing math and offering a perspective.

I hope this math and perspective may lend some insight.

[Curmudgeoness]

24. For a start,

we should be taxing higher incomes and high profit businesses at much higher rates.

Before you choke on that, as so many people do, let me explain why I think this works for the ordinary, low to middle income people. In the 1970's, I worked in accounting for a company that was doing very well. The tax rates were so high for profits over a certain point that the bosses chose to give large bonuses at the end of the year to all employees. As my boss said, he would pay taxes that were almost as much as the profits over a threshold, so he could lower the profit and have very devoted employees at the same time. It was a win/win, and it was made possible only because the tax rate was so high on excessive profits.

[JoePhilly]

31. So what rates do you propose and at what income levels?

The OP is about salary ... so that's where we should start.

Obama let the Bush tax cuts expire for everyone making 400k, or more. And that was rather important I think.

And so ... 400k is a lot of money ... I'd love to make that much.

I'm wondering what the proposal is.

[hifiguy]

36. We could look back to the highly prosperous ike Age,

when the top marginal rate was 91%. Adjusted for inflation, that seems to be a fine place to start, along with closing the obscene loopholes.

http://federal-tax-rates.insidegov.com/d/a/Dwight-D.-Eisenhower

[JoePhilly]

44. That site doesn't really seem to help much.

What I'm looking for is a graph starting at zero, and going up to the very top end that shows the progression of salary and wages.

Or is ~400k the "top" in this discussion? I mean, doesn't the "top" need to move?

Its 33% up to 400k, and then 91% past that? Or is it 50% at 100k, 70% at 200k, 85% at 300k, and 90% at 400k and above?

I'm also curious about this ... today some one makes 400k, and they pay a tax rate of 39%. Their income after tax is about 240,000. And then tomorrow, they still make 400k, but now its taxed at 90%. Their total income after tax is 40k. Which is an immediate hit of 200k.

How's that going to work logistically, not only at 400k and above, but also above and below that?

Depending on how you do this, the only people who really get hit are people who actually need their salary. The super rich don't really need a salary. Their money is coming mainly via investments that even under Ike were taxed at a lower rate. They'll just shift their investments around.

I agree we need the wealthy to pay more ... but I'd also like to see some models.

[Curmudgeoness]

72. There is a problem with your calculations

where you say "some one makes 400k, and they pay a tax rate of 39%. Their income after tax is about 240,000. And then tomorrow, they still make 400k, but now its taxed at 90%. Their total income after tax is 40k."

That has never been how the tax brackets work. That 90% rate would not kick in until the income hit $400,000, and would apply only to the amount over that.

You are correct that people who are very wealthy can shift their income around to take advantage of tax breaks, but that has always happened. What you need to do is try to leave fewer loopholes. But I will say that investment income is not taxes high enough now, since people who are making a million dollars in investments are paying less than someone earning a salary of $50,000. I do know that there is advantage to encouraging investment, but to ask people who are struggling to pay more than millionaires doesn't seem right either.....maybe a graduated tax for investments as well over certain limits.

[Igel]

100. They're not.

Take my family. Our gross income is a bit upwards of $100k/year.

Our tax bracket is something like 33%. We don't pay that much. We pay less than 6%, by the time you take into account our 1 kid and personal exemptions/deductions. We don't itemize for mortgage; we don't deduct medical expenses. Our "loopholes" are all on form 1040EZ.

In other words, we paid less than $6k last year.

Now, take somebody who has a 35% capital gains tax on their cool million dollars income. Because of deductions and various other things, they may get that down to 5%. They'd have to be clever about it--who knows what I could get our taxes down to by employing all the legal tax avoidance strategies available to me.

That 5% of $1 000 000 is going to be $50k.

If I pitch in FICA, which is typically done, they still pay more, but their percentage doesn't increase while mine does.

The point: They pay less, because they have a lower percentage. That made the news, and when people remember back, all they remember is "they pay less." We usually deal with $, not %, so we remember it applying to $. Most such arguments flip back and forth between % and $; it's hard to keep the numbers straight and remember them actually.

But they rich pretty much always pay more because they're shelling out more $--it's the rate, not the amount, that varies, and the rates for capital gains are set to achieve government policy. Those who relate things in % know you'll remember wrong; they want you to remember a lie. It's useful for their purposes.

It's all beside the point, anyway. What you want to look at is total employee compensation, not income, and at that point you need to start considering ACA subsidies as cash income. (Most civilized countries count cash subsidies and disbursements as going towards adjusted gross income calculations anyway, but even then compensation still matters for those who get it.)

[RadiationTherapy]

37. There is no proposal. I am just doing math and offering a perspective.

I think it helps to unpack the meanings of the income disparity conversation to divide out annual salaries or to convert "billions" into "thousands of millions." I am a student of communication and media; I can't help it.

[Curmudgeoness]

74. My proposal would go something like this...

although it is a rather simplified proposal, since I don't have all the numbers to make sure that we are getting enough total tax to run the government.

Ten tax brackets, going up at each 10% of the population in a category.

Lowest 10% of income for the population has 0 income tax.
Next 10% at 5% tax rate.
Next 10% at 10% tax rate.
Etc.
That would put the top 10% at 50% tax rate.

This would also be able to change with changes in income for everyone. The lowest 10% is a fluid number, changing over time with how much the population is making. A benefit to it that makes me giggle is that is gives the wealthy a reason to advocate for higher wages, since that would change the top 10% income.

[JoePhilly]

138. Finally, an interesting proposal!!

I'm not sure the numbers really work, but I like the general idea.

I've made a similar argument for social security ... not only do you remove the cap, you raise the floor. So, the first X% is not taxed for social security, but built into the benefits, so even if you never pay in, you still get the basic benefit.

I figure if you don't get to participate fully in the American dream, you should get the largest breaks. Those who are getting more from our country, owe more.

[Curmudgeoness]

145. Another thing that would do a lot to reduce the deficit

is to clamp down on people who are not paying their taxes or are paying less than they should by lying. I know from times past that when the IRS ramps up audits, people do not fudge their taxes nearly as much as they do when the chance of an audit is next to nil. For the past several years, there have been so few auditors that they are not able to audit many returns, and sadly, they are not the best and brightest. Professional CPA's are able to baffle and confuse them....I have seen this done over and over again. So we really need to have more auditors and get a high caliber of accountants doing that. Instead, they keep cutting the numbers.

And don't get me started with those ads I hear from companies that are supposed to deal with the IRS for you and reduce your tax bill that you never paid when it was due.

[One_Life_To_Give]

20. Neuro_Surgeon Income

A Neuro-Surgeon in Boston or New York could expect that salary or more once established. There are some people who are worth that much and then there are others.

[RadiationTherapy]

23. Right. I cannot speak to "worth," but I can imagine circumstances when

I find this salary "appropriate," but that would be a long chat.

[CrispyQ]

27. This vid id kind of long - 6.5 minutes - but worth checking out.

It shows how delusional Americans are about how they think wealth is distributed, versus how it really is. Go to about 3:24 for that info.

[RadiationTherapy]

28. Thanks. I will watch the entire video at home tonight.

[yeoman6987]

33. The president deserves every penny of it

[RadiationTherapy]

35. The president of my small, public university makes $400k/year.

They also get to live in a house for free, get to use a car anytime for anything, and have the best insurance possible.

Maybe it's Maybelline.

[yeoman6987]

39. I don't begrudge anyone making a salary that they

applied for. What I would like to see is hands off SS and pensions of those already vested or getting it. Salaries should increase but nobody should have their salaries decreased...that is the wrong way to do it.

[RadiationTherapy]

42. Maybe people "apply" for such jobs.

Maybe it is a club you have to belong to before you apply.

Maybe it's Maybelline.

[hifiguy]

46. It is absolutely a club

and we ain't in it and never will be, as Carlin told us repeatedly.

[JanMichael]

99. You are correct. You can spend approximately 20 years in one area of work.

People then know you and trust you and ultimately you benefit. Sometimes you would be the "best" candidate even though others may be approximately equal. They simply know you and trust you. That doesn't make it right.

The higher up the ladder we go the more that this is pronounced. The 1% will deal almost exclusively with the members of the 1% and maybe risk a little on someone from the top 2% or gawd forbid the top 5% or even more risky a smart low wealth family product that exceeds most all expectations.

People are draw to other people that share what they perceive as similar qualities.

That's why I am a crazy Marxist. Sadly even we do the same damned thing.

[panader0]

61. If anyone earns their money, it's our President.

[LittleBlue]

40. So what? It's a free country

Make all the money you want. The real issue is whether that income is taxed fairly.

[RadiationTherapy]

43. There is no "what?" I am just doing math and offering a perspective.

[Rex]

48. Well I guess math and perspective offend those that like to live and breath the political.

Facts do tend to have a liberal slant and that seems to make for the knee jerk reactions you are getting. Sad that simple facts make some trigger into an automatic defensive posture.

I guess that is more of the problem.

[Liberal_in_LA]

49. yes. who is saying it isn't?

[pnwmom]

54. What's the background on this? Why are we discussing whether $400K is a lot? nt

[RadiationTherapy]

57. I am not discussing it since I have already made my conclusion on the matter.

I just did a little math and offered a perspective. It triggered thoughts in others. Dialogue ensued. But there is no "why" to answer.

[pnwmom]

63. So it's not connected to some current political story? Okay, just wondering. n/t

[RadiationTherapy]

65. I suppose I was inspired to write based on a post I saw

that attempted to deflect criticism of the wealthy away from those who make around $400k/a year (top 1%) and toward those who make 10, 100, 1000x more than that. I wanted to break that number down to see if "the 1%" is a useful term for criticizing wealth.

[pnwmom]

66. I was wondering if a candidate was making a tax proposal that I hadn't

read about yet.

So thanks for explaining!

[RadiationTherapy]

67. Ah, yes. Tis the season!

I am glad I took a little time to reply.

[doc03]

56. I don't think $400,000 is all that much money especially in certain

areas. What I think is wrong is a CEO or some hedge fund trader making 100s of millions a year.

[RadiationTherapy]

60. In what areas and circumstances is $1100 a day of income not "all that much money?"

I addressed your second point in the op.

[doc03]

68. Well first of all they don't take home $1100 a day, after income taxes more like

$600 to $700 or even less depending on state tax. In this area you would be pretty comfortable. But how about San Francisco, New York, Washington DC, Alaska or Hawaii to list a few places? It is nothing in many places to pay $12000 or more a year tax on a
nice home. I don't have any problem with someone that (makes) $400,000 from hard work. We have an oil and gas boom here now, form what I hear many of those workers are in that income level. They work 14 hours or so a day 6 and 7 days a week in all kinds weather and they are away from their home living in a hotel. But when you get $100,000,000 for trading stocks or screwing over people that is different.

[RadiationTherapy]

75. I am aware that I was speaking in terms of gross income.

Last edited Mon Jul 13, 2015, 06:47 PM - Edit history (1)

As far as the rest, we would need to establish some meaning for subjective terms like "hard work" and "screwing people over" and we would have to dissect the meaning and value of "trading stocks" before determining if it qualifies as "hard" or "valuable" - maybe trading is hard and valuable. I wouldn't know.

[snooper2]

89. hours per week

[Igel]

107. You're not going to get a good definition for "hard work."

I teach. I think I work hard. Lots of constant low-level stress and dealing with students. I get summers mostly off. Then again, during the school year I often put in 60+ hour weeks and have parents and kids in my face.

A mech eng friend thinks he works hard. He's in an office, has the occasional meeting, and interacts with people seldom. But he's been working on a project and one part is his baby and has been for a couple of years. It has to put up with 25k psi, be corrosion resistant, easy to manufacture, easily replaceable, no more than a certain weight, and meet a variety of other design specs that keep changing as other parts it has to interact with change.

Then again, the family across the street thinks their father works hard, 8-9 hours a day 5 days a week fixing HVAC units.

And their kid thinks he works hard, working in a convenience store for 8 hours a day, on his feet, always having to deal with customers. Another friend worked hard, 40-50 hours a week landscaping--lots of shoveling, digging, operating equipment.

My father thought he worked hard, 40 hours a week as a supervisor at a steel mill--lots of papers, schedules, keeping things on schedule, shift work, in a place that was 120 in the summer and 30 in the winter.

Most working stiffs think white collar work isn't hard; they can't do it, however, and didn't spend 4-10 years training for it. They see they're making less per hours and miss that that "4-10 years training" time is lost revenue.

Good luck figuring out how psychological, financial, physical stress and exertion all fit together.

[doc03]

118. I agree with all your points, if a person does physical labor or deals with a lot

of stress or if they trained 4-10 years $400,000 may not be so much. But how on earth can anyone be worth
$100,000,000? The President has about the most thankless stressful job on earth and makes around $400,000 doesn't he?
I worked 40 years in a steel mill and made $65000 my last year and probably the kid at McDonald's making minimum wage worked harder than I did. Life isn't always fair.

[doc03]

116. Hey I could possibly justify $1100 a day if you work hard being physically

or mentally. But $1100 a minute like some CEOs or hedge fund trader how can anyone be worth that much?

[yeoman6987]

87. Taxes would cut it down to about 50 bucks.

[Agschmid]

90. In Mass. (Specifically Boston) it's not.

[Codeine]

95. Median household income in Boston is $53,601. nt

[Agschmid]

96. Yes I'm aware, try to buy a house anywhere near here on that.

400k doesn't get you much.

[Codeine]

98. 400 g's a year will cover quite the mortgage payment.

At the old "30% of income goes to mortgage" rule that's about ten grand a month.

That's huge.

[RadiationTherapy]

101. You decide to splurge and go $16k a month for a mortgage.

That leaves just $17k a month left over!

[Codeine]

102. We'll have to cut the cleaning woman down to five days a week

instead of seven. And we may need to keep the new Benz for two years rather than one.

Like living in a goddamned trailer park!

[RadiationTherapy]

106. Then the cleaning lady has to get a part time job to keep her own home.

She succeeds for almost three years, but dislocates her hip slipping off of the bus one snowy night. She can't work for 6 weeks and is never physically the same after her injury. After an extended, humiliating collections process, she loses her home anyways.

[JanMichael]

104. Most knee jerk anti-tax people are shitty at math.

They do not differentiate between net and gross and what the PPP would be in specific areas.

$400,000 in gross income, with benefits (health insurance, re-insurance (yes that exists), matched pension and death benefits etcetera) I would hope or they are idiots, get's most people without a coke or gambling problem into the nicest places in most places in the World. $5,000 a month in rent alone gets you pretty swanky places just about everywhere. $10,000 is even better and $120,000 a year which is 40% of $300,000 net. Bummer life and $180,000 to spend on all sorts of legal and illegal activities. Not.

[Agschmid]

109. It doesnt feel that way sometimes...

http://www.trulia.com/home_prices/Massachusetts/

[Codeine]

112. A $1.5 million dollar mortgage probably involves a payment of around seven grand a month.

Well within our ten thousand dollar budget.

Face it; the statement that $400,000 a year isn't much in *insert expensive American city here* is absurd on its face, and frankly a bit insulting to just about anyone who reads it. I could raise eight families on that sort of income.

[Agschmid]

113. Well I certainly don't make it, so its NBD.

[panader0]

59. I make $9648 a year from SS

I supplement that a bit by doing construction, but after 45 years, it's getting more difficult.
So all together around $15,000 a year. My girlfriend pays the electric and cable, I pay propane, taxes, and cut
all the firewood for heat. My (self built) house and land are paid for. So, I'm okay-I can afford beer (thank dog).
But my real wealth is my children-two girls almost out of college, two sons in the Coast Guard.
Everyone is healthy and happy--that is wealth to me.
I saved enough to go to my youngest son's "graduation" from CG boot camp on the 24th.
Tax the rich more. End the cap on Social Security:

From wiki:

In 2010, the Social Security Wage Base was $106,800 and the Social Security tax rate was 6.20% paid by the employee and 6.20% paid by the employer.[1] A person with $10,000 of gross income had $620.00 withheld as Social Security tax from his check and the employer sent an additional $620.00. A person with $110,000 of gross income in 2010 incurred Social Security tax of $6,621.60 (resulting in an effective rate of approximately 6% - the rate was lower because the income was more than the 2010 "wage base", see below), with $6,621.60 paid by the employer. A person who earned a million dollars in wages paid the same $6,621.60 in Social Security tax (resulting in an effective rate of approximately 0.66%), with similar employer matching. In the cases of the $110k and $1m earners, each paid the same amount into the social security system, and both will take the same out of the social security system.

[Warren Stupidity]

78. The L curve

Picture your annual income as a stack of $100 bills.
Do you make $25,000? Your stack of $100 bills is 1 inch high.
Do you make $100,000? Your stack of $100 bills is 4 inches high.
Do you make $1 million? Your stack of $100 bills is 3.3 feet high.
Do you make $1 billion? Your stack of $100 bills is over ½ mile high!

The U.S. Income distribution is not a “Bell Curve”…it is an “L-Curve”!

On the scale of the football field graph shown here the bottom 99% of the population
measure their incomes in inches. The top 1% measure their incomes as stacks of $100 bills
feet or even miles high! The total wealth of the few people in the vertical spike equals the
total wealth of the rest of the population combined.

The L-Curve raises many questions. Why does the wealth (which we all help produce) go
so disproportionately to the few at the top? Why, in a prosperous economy, is there so much
poverty? Why has the lion’s share of the growth in recent economic booms, gone almost
exclusively to those in the vertical spike while wages have stagnated?

Politically speaking, the L-Curve raises even more questions. Concentration of wealth
produces concentration of power that is fundamentally incompatible with democracy. Why
does our government give tax cuts to those on the vertical spike that result in cuts in services
for the rest of us?

The horizontal spike has the votes, but the vertical spike has the
influence! They own the media. Your TV set is their pipeline into your brain! They set the
agenda and the terms of debate. Furthermore, by the time you enter the voting booth all the
“serious” candidates have been filtered and pre-selected by their ability to raise funds from
those on the vertical spike. Those who can’t attract big money are marginalized.

The only way to make the government for the people is to make it of the people and by
the people. That means we, the people, must wake up. We must wake up our
neighbors! We must learn to talk to each other directly. We must bypass the media
culture and rebuild true community. Democracy does not start in the voting booth. It
starts by building a movement at the grass roots level that values people over profits.

For more on the L-Curve and its implications, see: www.lcurve.org

by the way wealth distribution is even more skewed than income distribution.

[Agony]

79. making $400k as president of a union or a civil justice organization or a food bank

is as much a problem for a just society as the epidemic of obscene CEO compensation. It is the same stripping of money out of the pockets of ordinary people.

[seveneyes]

80. How much for a two week trip to Greece for a family of seven?

More than a trip to Cranson, USA I'm thinking ...

[TheKentuckian]

84. I will probably forever recall the cries of deadbeat for those worried about a 10% tithe

to the insurance cartel but when it came time to talk about taxes the 250k and up crowd was crying and wringing hands about a 3.5% increase because the poor, poor dears on the coasts would suffer mightily and that number needed to be (and was) pushed up.

Folks were on here demanding poor people's expenditures and demanding people turn off their internet and phones to pay the insurance cartel and then a few months later had the fucking nerve crying hardship for the affluent for a much smaller tax increase.

When asked how the person serving them there Starbucks gets by, they didn't have a fuck to give with a pallet of ca$h in a whorehouse.

We now have a "middle class" that stretches from less than 16 all the way to 400k but like 42% of people make less than 15 bucks an hour. Yeah, fucking right.

It doesn't take a genius to figure out why discussion of economics causes conniptions and charges of any kind of "ism" some can reach for, reality is they will have to come off some stacks not just Dimon and Gates.

[Igel]

111. Some of what's lost is household versus individual income.

My income is about median household income. My wife's is a little above median. We're both college grads. In fact, my wife took a $40k/year salary cut because she didn't like her job and could afford to do what she wanted.

Together we're nuzzling the 20th percentile from the bottom.

My neighbors make relatively low individual wages. They don't have college degrees. Most are married--those who divorce typically are forced to sell. Married couples' household income is a bit above median household income; many have kids who also work, and that is also part of their household income. That brings them to a couple of thousand dollars above household median for the US.

Still, our household income is significantly higher than neighborhood household income. And that's how American society has patterned in the last 20 years, like it or not.

Throughout the '60s and '70s and '80s as higher-income jobs faded we moved to a two-income household model. Typically one higher-wage male + one lower-wage female earner.

In the '90s society started to split, as fewer college grads married those who didn't attend college. The middle class has, to some extent, been "gutted" because of this. During the 2000s, last decade, more of the decrease in the middle class happened because they moved to the upper class than to the lower class.

42% of people making <$15/hr is a fairly meaningless number when we're talking household income. That's the trouble with this entire thread: gross vs adjusted, compensation versus wages, marginal versus effective, household vs individual, SF or NYC versus Podunk, IA. Nothing meaningful can be said because there are no meaningful comparisons to be had.

[TheKentuckian]

126. How is what people actually make meaningless?

Median household seems to be the number used to hide the reality of most people's wages to me.

Two people scratching up the best they can on optimistically 12.50 or so each is closer to reality.

Hell, no small amount of these median earners are two people with some overtime to make it and at the end of the day, don't have a pot to piss in even if you can churn out some solid sounding numbers to minds tuned to like 20 years ago money.

[RadiationTherapy]

139. Wow, your post makes me feel positively diplomatic!

I appreciate this righteous rant.

[Recursion]

85. That cuts both ways. Explain $28K to a person in Lagos or Kolkata

That's just as crazily huge to him as $400K is to you and me.

[TheKentuckian]

119. So what? We are comparing people in the same general economy. How much is rent in Lagos?

[Recursion]

120. How much is rent in Manhattan?

Lagos in particular has a booming real estate market with rents approaching US levels per square foot (people just live 4 to what we would call a 1 bedroom).

[RadiationTherapy]

127. Well, if they are lucky enough to find a place in Mahattan for $17k per month

they may be able to squeak by on the remaining $16k per month.

[TheKentuckian]

140. Well, you better get over there and help them get on track and stop trying to drag working Americans

down.

[DFW]

86. My younger daughter makes close to that

But she lives and works in Germany, where the effective 50+% rate kicks in at about a quarter of that. She essentially works for the German government from Jan. 1 to late July, at which point, she starts working for herself.

[daredtowork]

97. Thank you for bringing influence and social capital into the discussion

Now compare people on welfare in the San Francisco Bay Area being strangled on only $336/month which goes directly to a landlord lest they spend the money on alcohol and drugs. They have to find the housing that will take $336/month themselves (no help) in a market where new one bedrooms are going for around $3000/month. Thus, the supposed "hand out" which the GOP is always complaining about is actually a SET UP for homelessness unless you were lucky enough to have family or friends in the area who will give you some sort of really special deal for rent on a temporary basis.

The fact that rightwing idiots constantly kvetch about such a tiny amount of money drives me up a tree. A lot MORE money needs to be poured into the system to stabilize people and seriously assist them in getting back on their feet. This situation just puts them into an unbearable amount of stress and drives them into homelessness.

[RadiationTherapy]

103. Yes, I am personally moving my definition of wealth away from notions of luxury.

I see wealth a sense of security as well as the ability to influence policy and, of course, wield force.

And, yes, far far more money needs to go into social safety.

[Taitertots]

108. Influence? Power? $400,000 doesn't even get you a seat at the table.

$40,000,000 buys power, influence, security. It's knowing your grandkids will never have to work a day in their life.

[B Calm]

117. Well $400,000 will always allow your grandchildren to fly first class.

[elias7]

125. Uh, no.

[B Calm]

136. Uh, yes. . $400,000.00 per year!

[ohnoyoudidnt]

131. So what?

Should two doctors not have the right to fly their grandchildren first class? The Kochs and Jamie Diamond types are the ones we should be worried about. A family with an income of 400k, not so much.

[daredtowork]

121. Mention that the next time Congress is recommending to cap SSI at $733/month

If $400,000 can't get you a seat at the table what are you granting disabled people with 8796/yr? Microscopic crumbs from the table? Licked off your boot heel? I'm sure it will be because "we" (who are earning $400,000/yr) can't afford it.

[zappaman]

122. Math!

[ohnoyoudidnt]

129. What am I missing? Is this related to another issue being discussed here?

400k a year is a lot of money, but it is not the kind of income that buys politicians . It is the kind of money some doctors, lawyers, business executives, business owners, and professional couples make for a family income. These are not the people that are the enemies of the lower classes. They are people who worked their asses off and with some luck did well for themselves. 400k is a big deal, but the multi-millionaires and billionaires that are far more influential to politicians and a
are the ones we need to be concerned about,

[AOR]

135. The fact that those who reside in the professional class...

worked their asses off is irrelevant. What's relevant is that the majority (certainly not all) have a complete lack of solidarity with those beneath their imagined "social status of winner" in "the game" of Capitalism. When it comes to the struggles between Capital and Labor...the complicity with the priorities of the ruling class is what is precisely relevant. As you might discover on deeper examination... there is no shortage of lifetime social scabs that inhabit the web swamps who like to wave their capitalist "winner" status around like a sword. That is what you are missing.

[RadiationTherapy]

144. A person who makes $30k a month is not anywhere near the world of $30-$120K per year

and I get so tired of the wealthsplainers trying to pretend they are middle class or working class merely because they have a job instead of inherited wealth or wall street good luck. By pretending they are not in the wealth class, they often resort to insulting advice about how to move or how to save money or how to cut internet and phone service or how to retrain for the "new economy." There is no new economy. There is neo-feudalism and the New American Aristocracy, but there is hardly a functioning economy anymore. We live in a Hoardocracy.

[AOR]

146. Well said and agree completely...

In the US only about 10 percent of the population make over $75,000 a year. It's from that point that the capitalist race to the bottom begins. I don't know the exact breakdown, but the vast majority of the other 90 percent earn far less than that 75 grand, while millions of others exist right at or below the poverty level, and millions more are born into and live in abject poverty. This doesn't even begin to tell the story of the destruction and poverty that global capitalism has unleashed around the globe.

Only about 10 percent of the population has any real security, can make house, car, insurance payments without taken on large amounts of debt, don't worry about food and can invest in the capitalist Wall Street scheme. It is within that world of the 10 percent that all "economic planning" takes place and those doing the planning rarely consider their "lessers" when making those plans. Some might put on a righteous facade about how the care about income inequality and disparity, but in the end, the bottom line is preserving their own status and self-interests above all else. They are for the "middle class" of course, the ten percent middle class they reside in and not the "middle class" that works to eat and lives paycheck to paycheck one job loss, personal calamity, or health issue away from losing the crumbs they've been tossed to keep the capitalist death machine rolling along. Fuck them, their portfolios, their upscale "feel good charity", and their bootlicking for the ruling class elite. The majority of them will risk NOTHING for working class solidarity, better conditions for the poor and elderly, or anything else that has any impact on social conditions and inequality in this country or anywhere else.