Questions about Obama's speech and position?

[Anonymous]

$250K is rich, whether you live in DC or Alabama. I live in the NYC metropolitan area and we have a combined household income of $140K. We just got pre-approved for a $400K mortgage. We are doing well. Put another $110K on that (and, yes, I realize that is gross, not net) and I'd make no bones calling ourselves rich. Are there people far, far richer than that? Yes. But it doesn't mean that being able to buy a house in probably 90% of neighborhoods, owning two cars, and sending kids to private school is middle class.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:The fact that someone can afford to live in DC and send their kids to private school--a true luxury--doe indicate you have some degree of wealth. Those are both luxuries a good part of the country cannot afford.

And you do understand that these are things that have a residual effect for the economy? It pays for the taxes of teachers, admin, janitors etc. This money isn't being thrown away.

Of course, but what's your point? Everybody to some degree contributes to these things, via property, sales, and/or income tax. People in the 250K plus don't have a market on supporting the janitors. It sounds like you are getting close to advocating trickle down economics (though I could be misreading), one of the biggest failures ever in economic theory.

My point is that when people call private school a luxury they act as if its a frivolous good with no societal benefit. However you slice and ice it $250k is not RICH and they aren't billionaires and they don't ride in corporate jets.

I agree - I find it intellectually dishonest for the President saying he just want millionaires and billionaires to pay their fair share (translation - more) when in fact the bar is so much lower than that. A two income family of four in Bethesda earning 300K gross may not even have a net worth of a million dollars (particularly when upside down on a mortgage), much less that much in income.

Whether it is a luxury or not begs the point - call it like it is, don't look us in the face and make it a class thing about hedge fund managers and private jets!

[Anonymous]

Anonymous wrote:I actually think he is talking about millionaires and billionaires. He's not talking about the Bush tax cuts-- he's talking about the loophole that lets hedge fund managers (who earn tens of millions a year) to pay capital gain tax rates (the highest rate on long term capital gain is 15%, which is less than half of the usual top rate for salary), and he's talking about preferential tax deductions for personal jets.

Also it makes no sense to say that someone nets 100k out of a family company but would be taxed at the 250k level.

If you say so. I have not seen his plan in writing.

And if we are going to let the Bush tax cuts expire - let them all. Every tax bracket was reduced, to selectively increase just some brackets and call it "expiration of the Bush tax cuts" is just a lie.

[Anonymous]

Anonymous wrote:OK take a deep breath. Let's get a few things clear. IF you live in Alabama the likelyhood you'll sniff $250k is so much lower than in say DC, NY, SF, or LA. These places are also very high cost of living areas so that 250k doesn't go very far. I actually think $500k is a much fairer amount to start a new tax bracket given where we are in America with regards to cost of living adjustments.

A family with 2 kids in DC and private school or college (not some cheap suburb) doesn't feel rich, because they arent.

Fine. Sounds good. So let's compromise, and say that the House GOP will raise taxes on income above $500k. What do you think the odds are of that happening are? If you guessed, "fucking zero" give yourself a cookie.

[Anonymous]

Anonymous wrote:

Anonymous wrote:A. Nobody says it will be absolutely painless for those with over 250K to pay more tax (on the taxable income over 250K) than under present law. The claim is just that with all the pain going around, they can bear a bit of it.
[I note that my last sentence is ambiguous, depending on which clause you link "just" to; I stand by either meaning.]

B. In any case, there could be negotiation of the threshold 250K, if that would get agreement.

But would you agree that the president's assertion that we need to tax billionaires and fatcats more and then really having the new rate start at $250k political theater? I honestly believe that if he had come in at $500k he would have been able to get this passed when the Dems still controlled the house. The problem with $250k is that while it captures the typical DC family that I described it also hits a lot of really small businesses where the actual owners probably only net $100k out of the firm. I think even Mankiw did a blog posting and said he didn't think the doctor making $400k should be taxed at the same rate of the CEO making $15m. My personal belief is that taking 40% from a family making $250k has a much more disastrous effect than a family making $1mm.

I get what your saying, but a family making $250k won't be taxed at 40% because their taxable income is below 250k. Even if a family makes $300k, they are unlikely to have much over 250k taxable, maybe a total of 275k, which only 25k is above the 250k start point. So its only 40% on that 25k, not 40% of the entire 250k - so it will be $10k on that instead of just 7k - a whopping 3k more on a family that makes 300k. The rest of the 250k falls mostly into the 28% braket, and small amounts in the lower tax brackets.
Anyways, someone making 10M would be paying more like 3.6+M in taxes instead of 2.5M in taxes. So no, you can't really say they are being taxed "the same".

[Anonymous]

Anonymous wrote:I get what your saying, but a family making $250k won't be taxed at 40% because their taxable income is below 250k. Even if a family makes $300k, they are unlikely to have much over 250k taxable, maybe a total of 275k, which only 25k is above the 250k start point. So its only 40% on that 25k, not 40% of the entire 250k - so it will be $10k on that instead of just 7k - a whopping 3k more on a family that makes 300k. The rest of the 250k falls mostly into the 28% braket, and small amounts in the lower tax brackets.
Anyways, someone making 10M would be paying more like 3.6+M in taxes instead of 2.5M in taxes. So no, you can't really say they are being taxed "the same".

To be a bit more precise, it will be 39.6%, or $9,900, vs 35%, or $8,750. So the 3k estimated above will actually be a little over 1k. That's worth throwing us into default over????

[Anonymous]

Anonymous wrote:

Anonymous wrote:I get what your saying, but a family making $250k won't be taxed at 40% because their taxable income is below 250k. Even if a family makes $300k, they are unlikely to have much over 250k taxable, maybe a total of 275k, which only 25k is above the 250k start point. So its only 40% on that 25k, not 40% of the entire 250k - so it will be $10k on that instead of just 7k - a whopping 3k more on a family that makes 300k. The rest of the 250k falls mostly into the 28% braket, and small amounts in the lower tax brackets.
Anyways, someone making 10M would be paying more like 3.6+M in taxes instead of 2.5M in taxes. So no, you can't really say they are being taxed "the same".

To be a bit more precise, it will be 39.6%, or $9,900, vs 35%, or $8,750. So the 3k estimated above will actually be a little over 1k. That's worth throwing us into default over????

Woh, woh, woh buddy, you are going to confuse everyone with these facts! Most people don't even realize how tax brackets work! They assume once you cross into a new bracket your entire salary is taxed at that rate. Financial literacy in this country is woeful and leads to many of the problems we currently face. If people actually understood how the tax system worked, they'd realize how idiotic much of the hemming and hawing is. But alas...

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:A. Nobody says it will be absolutely painless for those with over 250K to pay more tax (on the taxable income over 250K) than under present law. The claim is just that with all the pain going around, they can bear a bit of it.
[I note that my last sentence is ambiguous, depending on which clause you link "just" to; I stand by either meaning.]

B. In any case, there could be negotiation of the threshold 250K, if that would get agreement.

But would you agree that the president's assertion that we need to tax billionaires and fatcats more and then really having the new rate start at $250k political theater? I honestly believe that if he had come in at $500k he would have been able to get this passed when the Dems still controlled the house. The problem with $250k is that while it captures the typical DC family that I described it also hits a lot of really small businesses where the actual owners probably only net $100k out of the firm. I think even Mankiw did a blog posting and said he didn't think the doctor making $400k should be taxed at the same rate of the CEO making $15m. My personal belief is that taking 40% from a family making $250k has a much more disastrous effect than a family making $1mm.

I get what your saying, but a family making $250k won't be taxed at 40% because their taxable income is below 250k. Even if a family makes $300k, they are unlikely to have much over 250k taxable, maybe a total of 275k, which only 25k is above the 250k start point. So its only 40% on that 25k, not 40% of the entire 250k - so it will be $10k on that instead of just 7k - a whopping 3k more on a family that makes 300k. The rest of the 250k falls mostly into the 28% braket, and small amounts in the lower tax brackets.
Anyways, someone making 10M would be paying more like 3.6+M in taxes instead of 2.5M in taxes. So no, you can't really say they are being taxed "the same".

I'm continually stunned at the number of people out there that vote on economics issues, but have no clue whatsoever about the particulars. Are there really people of voting age in America who don't understand how marginal tax rates work? It's no wonder that the GOP so effectively demogogues on this horseshit every year.

It's incredibly hard to run a campaign of facts against a campaign of smoke, mirrors, and resentment in an age of widespread ignorance.

[Anonymous]

Talk about smoke and mirrors, the president who harps on fat cats and billionaires yet they are a tiny portion of the people who will actually be affected by this. Why can't Obama just be honest? Hedge fund managers? You're talking about a few thousand people at most. Please.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get what your saying, but a family making $250k won't be taxed at 40% because their taxable income is below 250k. Even if a family makes $300k, they are unlikely to have much over 250k taxable, maybe a total of 275k, which only 25k is above the 250k start point. So its only 40% on that 25k, not 40% of the entire 250k - so it will be $10k on that instead of just 7k - a whopping 3k more on a family that makes 300k. The rest of the 250k falls mostly into the 28% braket, and small amounts in the lower tax brackets.
Anyways, someone making 10M would be paying more like 3.6+M in taxes instead of 2.5M in taxes. So no, you can't really say they are being taxed "the same".

To be a bit more precise, it will be 39.6%, or $9,900, vs 35%, or $8,750. So the 3k estimated above will actually be a little over 1k. That's worth throwing us into default over????

Woh, woh, woh buddy, you are going to confuse everyone with these facts! Most people don't even realize how tax brackets work! They assume once you cross into a new bracket your entire salary is taxed at that rate. Financial literacy in this country is woeful and leads to many of the problems we currently face. If people actually understood how the tax system worked, they'd realize how idiotic much of the hemming and hawing is. But alas...

You aren't kidding!

[Anonymous]

Anonymous wrote:

Anonymous wrote:I actually think he is talking about millionaires and billionaires. He's not talking about the Bush tax cuts-- he's talking about the loophole that lets hedge fund managers (who earn tens of millions a year) to pay capital gain tax rates (the highest rate on long term capital gain is 15%, which is less than half of the usual top rate for salary), and he's talking about preferential tax deductions for personal jets.

Also it makes no sense to say that someone nets 100k out of a family company but would be taxed at the 250k level.

If you say so. I have not seen his plan in writing.

And if we are going to let the Bush tax cuts expire - let them all. Every tax bracket was reduced, to selectively increase just some brackets and call it "expiration of the Bush tax cuts" is just a lie.

Not sure who was the recipient of these tax cuts anyway. If you pay the AMT the tax cuts didn't do squat for you.

[Anonymous]

Anonymous wrote:

Anonymous wrote:

Anonymous wrote:I get what your saying, but a family making $250k won't be taxed at 40% because their taxable income is below 250k. Even if a family makes $300k, they are unlikely to have much over 250k taxable, maybe a total of 275k, which only 25k is above the 250k start point. So its only 40% on that 25k, not 40% of the entire 250k - so it will be $10k on that instead of just 7k - a whopping 3k more on a family that makes 300k. The rest of the 250k falls mostly into the 28% braket, and small amounts in the lower tax brackets.
Anyways, someone making 10M would be paying more like 3.6+M in taxes instead of 2.5M in taxes. So no, you can't really say they are being taxed "the same".

To be a bit more precise, it will be 39.6%, or $9,900, vs 35%, or $8,750. So the 3k estimated above will actually be a little over 1k. That's worth throwing us into default over????

Woh, woh, woh buddy, you are going to confuse everyone with these facts! Most people don't even realize how tax brackets work! They assume once you cross into a new bracket your entire salary is taxed at that rate. Financial literacy in this country is woeful and leads to many of the problems we currently face. If people actually understood how the tax system worked, they'd realize how idiotic much of the hemming and hawing is. But alas...

And this is where our education system continues to fail us. Seem like we should be worrying more about requiring basic finance literacy than whether students take foreign language or arts. Not that I would support eliminating these requirements.... just saying.

[Anonymous]

Anonymous wrote:Talk about smoke and mirrors, the president who harps on fat cats and billionaires yet they are a tiny portion of the people who will actually be affected by this. Why can't Obama just be honest? Hedge fund managers? You're talking about a few thousand people at most. Please.

Speaking of disingenuousness: it's not a matter of how many people are affected. It's a matter of how *much* they're affected by it. Just as it's political posturing for the benefit of uninformed yahoos to talk about earmarks and "balancing the budget" in the same breath, it's equally ridiculous to talk about how we can't balance the budget on the backs of "only a few thousand people". Of course not. You balance it on the backs of 1% of the US population. The one's who own 38% of the nation's wealth.

Here's the breakdown of wealth:

Top 1% own 38.1%
Top 96-99% own 21.3%
Top 90-95% own 11.5%
And it gets much uglier as you proceed downward. Bottom 40% of population has 0.2% of all wealth

Meanwhile, here's the compensation trend over 1990-2005:



So, yes, you tax the very wealthy. Just as they do in every other developed nation in the world.

[Anonymous]

Anonymous wrote:Talk about smoke and mirrors, the president who harps on fat cats and billionaires yet they are a tiny portion of the people who will actually be affected by this. Why can't Obama just be honest? Hedge fund managers? You're talking about a few thousand people at most. Please.

The top 25 hedge fund managers took home an *average* of $1Bn last years. That's one thousand times a million dollars. So we make a 90% bracket. Everything over 10 million dollars is subject to that rate. Reimplement the estate tax as we had during the Golden Age of post-war US. Stop being such craven toadies who can't surrender fast enough in the class war the ultra-wealthy have been waging on the middle-class for the last 50 years.

[Anonymous]

An excellent graph that outlines the numbers:



Stop your whining and pay the operating expenses for your goddamned country. George Washington would slap you across the face.