| Author | Message | ||
     Jules |
It's the same in the UK, I was a little surprised to hear how low the threshold to be in the top 10% of earners was here too - oddly enough we are one of those "nurse and IT professional" families. 40% of my salary is taken off me in income tax plus another ~10% in "national insurance" (state healthcare benefits) and then there's local taxes (council tax as it is called here). For a takehome salary of $110k I actually pay around $60k in tax a year. "Rich" is a sliding scale - to someone in a $20k a year job I am sure someone on $100k seems rich (they're not). Our top taxation bracket is 90%, that's 90% of what you earn taken from you at source bu the govt...that's why so many people on high incomes leave the country (I know I would!) | ||
| Forerunner |
Hey Jules, How's that VAT working out for ya? Nels | ||
| Court |
>>>Our top taxation bracket is 90%, that's 90% of what you earn taken from you at source bu the govt... Thanks for the Beatles. | ||
| Freight_dog |
Actually Jdugger, the rich in the US are the LEAST heavily taxed of all developed nations. Furthermore, the 50% you speak of don't pay zero taxes; sales tax, state and local taxes etc. are all regressive (flat taxes). The only reason 10% pay most of the taxes is due to the income inequality designed into our economy. The fact that only $140k puts you in the top 10% tells me there is something wrong. | ||
| Dannybuell |
Jdugger - please cite your sources. Kevin Phillips a former Republican Party strategist has written a few books; "Wealth and Democracy: A Political History of the American Rich" has all kinds of U.S. government stats you might find interesting. This book clearly supports the arguments I have made on the growing gap between rich and poor. Executive salaries used to be 40 times the lowest wage in a company, now it is 400+ times.... | ||
| Dannybuell |
Freight_dog - +1 | ||
| Jdugger |
My data comes from the IRS. They publish the taxation and income tables every year. If you get the *facts*, they are indeed shocking. I'm not talking about some ideological BS about social justice or fairness or whatever term has been selected lately. But, just plain, good ol' fashioned, FACT. I'll make you guys a deal... The same one I make every one that brings this nonsense up. You clearly have a good grip on how things should be. I'm up for it, let's give it a try: YOU PAY FOR IT, K? (Message edited by jdugger on December 26, 2010) | ||
| Freight_dog |
Jdugger, the fact is, you are taxed at 10% on your first $16,750, just like the kid earning $6.00/hr at McDonalds. You are taxed at 15% on what you earn above $16,750 to $68,000 just like the lunch lady at your kids school. You are taxed at 25% for what you earn from $68,000 to $137,300, just like me and you are taxed at 28% for what you earn above that up to $209,250. The fact is that you do not pay one penny in higher taxes than anyone earning less than you, you just have more plentiful income to pay taxes on! 35% Over $373,650 | ||
| Jdugger |
Freight, I understand very well how a progressive tax rate works. It still doesn't change that almost the entirety of everything is paid by a tiny few. I don't earn in the top tax bracket. No where near it. I do, however, live within my means. And, I don't begrudge those that earn more or feel that it's unfair they do. | ||
| Dannybuell |
These wage earner arguments, no discussion of upper income loopholes. upper incomes have risen steeply. since ronald reagan told us that 'trickle down economics' meant letting the rich get richer so it would eventually trickle down to everyone else. History has proven that argument to be wrong. To hear these arguments 20 and 30 years later from the neo-cons proves that there are people who still believe what they are told. These Richy Riches are NOT wage earners, their income is based entirely on growing their wealth. Trickle down economic theory helped the Richy Riches of the world, it had nothing to do with wage earners. It didn't work back then and it doesn't work now. WTF! If a government is going to give someone a break maybe the wage earner, jobless, homeless...? Helping a Richy Rich is like escorting a policeman through the crosswalk, he really doesn't need the help. | ||
| Jules |
Hey Jules, How's that VAT working out for ya? Nels LOL - I thnk I'm going to quit my job in the New Year and go self employed again, I can halve my tax bill by paying myself minimum wage and then just paying corporation tax on dividends instead of income tax. I can also avoid VAT on a lot of stuff by paying for it through the company and then claiming the VAT back. They changed the rules on purchasing motorcycles, they are now in the same category as farm machinery rather than vehicles so I can depreciate them fully in the first year, that'll reduce the cost of (as an example) a new Blade from £10k to £5k as it's purchased with the gross income (pre-tax) and the VAT can be reclaimed and then 100% depreciation in year one means I can buy it from my own company at month 13 for peanuts and sell it for a (non-taxable) profit. Lat time I was self emplyed (working as a consultant at AOL) I was bringing in $16k a month but only paying about $3k in tax... that's a much more attractive prospect. I don't want to evade my responsibilities but I am fed up with paying so much tax on my income and then tax on everything else I buy too.. | ||
| Freight_dog |
That is right Jdugger, if you put all the wealth in the hands of a few they will be the only ones who CAN pay taxes. Look at it as being one of the fortunate few who can pay taxes. Remember, the other 90% aren't poor out of choice, the "reverse Robin Hood" policies of the right since Reagan made them poor. Between destabilizing the economy with record low taxes and financial deregulation and Union busting, they have made long term employment a memory. They want to see that 90% over a barrel to make it easier to squeeze them into lower wages. The beauty of it is that talk radio and Faux News has you blaming the victim for the rape! | ||
| Gsxrguy |
there is a BIG difference between the top 10% and top 1% | ||
| Dannybuell |
Freight_dog - Yes, nice rape argument! The religious right are proud to be the sheep and bear the scars to prove it! Gsxrguy - Good point! With a modest amount of prudence the top 1% will have endless generations of wealth. The top 10% will pass on many generations of wealth. They just changed the estate tax to 10 million each person so 20 million husband and wife. What would you do if you had 20 million dollars? At 2x your families current standard of living, how many generations of your family could 20 million dollars pay forward to? Would your children and your grand children work, play, or become civic leaders in pursuit of greater social service? The Simpsons cartoon show children would likely go on two distinct paths. Lisa would be civic minded and Bart would 'party on'. If I had 5 million I know that there would be an 1190 next to my challenger, next to my awd cadillac sedan in a nice big house with a free standing shop and apartment upstairs. I guess that makes me Bart Simpson. The 1% and 10% folks drop their pocket change onto Democratic politicians as insurance and Republican politicians, conservative 'faux news', conservative talk radio, any conservative media that embraces patriotism and perpetuates the mythology that maintains their special way of life. Trickle down? Yes trickle down your leg after the dog is done with you. | ||
| Court |
Interesting range of opinions. | ||
| Jdugger |
> there is a BIG difference between the top 10% and top 1% It's presently about $200k per year. Top 1% are something like $340k or something like that, top 10% are $130k or so. I might be off a few tens of thousands, but I'm not off significantly more than that. The data comes from the IRS, and you can find it on Wikipedia, too, under household income distribution. I love the name calling, the analogies, and the victim blaming. The Richy Rich... laughable. Danny, I'm going to let you in on a little secret, one that's served me well: It's not the government's job to cut ANYONE a deal... that's YOUR responsibility. And, what upper income loopholes do you speak of? Isn't the tax law the same for all? I'd like to see you cite some examples of where because one is wealthy they get a special privilege under the law others don't. The only one I can think of off hand is a restriction around something called a "qualified investor" which is designed to prevent capital investments in risky startup ventures and other businesses by unsophisticated investors in situations of limited disclosure. Freight -- perhaps you would like to explain how Regan -- a president some 20 years ago -- is STILL holding you down? You don't think that the cost of labor here vs. elsewhere had anything to do with the legitimate competitive business decision to move low-skilled manufacturing elsewhere, do you? Really, what did you *expect* to happen? How would you have prevented this? Do you understand the macroeconomic reality of isolating America's labor market? And, America isn't exactly a low tax haven. For one, it has the second highest corporate tax rate in the world. If you were a corporation, would you leave profits in a low tax district, or repatriate them and pay a whopping tax on them here in the US? I'm asking basic business questions here. You are a CEO. Your job is a successful firm that grows and creates value for your shareholders. What decisions would *you* make in a competitive marketplace? At the end of the day, there are those that will find a way to make themselves happy. They will have reasonable lives, some will have incredible ones, but all that are determined will do just fine. And, there are those that will howl about unfair it is, while mostly not doing much to improve their own situations. I'm firmly in the middle class. So many in this country make so much more than I do, and pay so much more of the tax bill, too. Because of the progressive nature of the income tax, they pay a larger share of their income as a percentage than I do, too. I don't really think it's fair, but I'm sure glad they do. I don't begrudge them or think it's unfair they make or have more money or resources. I don't even begrudge the inherited ones -- lucky though they clearly are. If I wanted to, I could make more myself. I just don't think it's worth the effort... so here I am, happy in the middle ground. Alas, it's sad so many others can't just see it to let things be and let people be people, making their own choices. | ||
| Gsxrguy |
Most super high earners don't get their pay directly from their employers, but instead as dividends from the shares of stock they own or are issued as compensation. dividend tax rates are 5% or 15% (Message edited by gsxrguy on December 27, 2010) | ||
| Dannybuell |
I agree the top 1% of household income is 350K. The top 1% of national wealth have several hundreds of millions to billions, The top 10% of national wealth are tens to hundreds of millions of dollars. From Wall Street Journal http://blogs.wsj.com/wealth/2010/04/30/top-1-incre ased-their-share-of-wealth-in-financial-crisis/ "According to his analysis, the top 1% held 34.6% of all national wealth in 2007. By Dec. 31, 2009, they held 35.6%. Meanwhile, share of national wealth held by the bottom 90% fell to 25% from 27%. " The rich are getting richer the poor are getting poorer. "Danny, I'm going to let you in on a little secret, one that's served me well: It's not the government's job to cut ANYONE a deal... that's YOUR responsibility." I support that idea, Now tell it to the thousands upon thousands of lobbyists-agents buying economic policy for their RR clients. LOL 3x. RR getting loopholes? Capital gains taxes would be a good start. US highest corporate tax rates? try again http://en.wikipedia.org/wiki/Tax_rates_around_the_ world Determination and opportunity. 180 degrees off, Taxes are NOT progressive for Richy Rich they are more regressive than they have been in 60 years. Why do you think it is more important to defend the rich when I have mentioned homelessness several times? Tell that guy at your high school class reunion who isn't making it to be more determined. The guy that struggled in school will struggle in life. You can have all the determination in the world and still be unable to compete with jobs going overseas. Kids today won't get an engineering education knowing their economic competition is in India. That is dumbing down America, maybe not today... | ||
| Court |
That statement is inaccurate. While the dividend would be taxed at 15% (the same at the Long Term Capital Gains rate and ASSUMING it is a qualified dividend) the value of the stock (mine is roughly $50 per share) is taxed as ordinary income. The good thing about a thread like this is that it makes the information in the "synthetic vs. petroleum oil" threads look accurate and credible. | ||
| Freight_dog |
It's true Court, there is a lot more disinformation out there than facts and policy/political philosophy arguments are mostly rhetoric and hearsay. That being said, my Reagan reference was alluding to the fact that he began the current policies of low taxes, corporate deregulation and union busting that still plague our economy and effectively are causing the destruction of the middle class. I have no solution to offer regarding outsourcing other than to see international wages rise to our standard. That would also solve the illegal immigration question, but like I said, I have no long term solution other than pressuring foreign governments to encourage organized labor. Of course, that is against the best interest of our corporate oligarchy, so will never happen. I also wanted to say I am impressed that this discussion has remained more civil than these debates usually do and for that I am grateful. | ||
| Hootowl |
"For one, it has the second highest corporate tax rate in the world" No longer. We're number one. Japan is reducing its tax on corporate profits. That puts us in first place. Yay! | ||
| Jdugger |
> "According to his analysis, the top 1% held 34.6% of all national wealth in 2007. > By Dec. 31, 2009, they held 35.6%. Meanwhile, share of national wealth held by the > bottom 90% fell to 25% from 27%. " The rich are getting richer the poor are getting poorer. Danny, That's assets, not income. Now, I agree there's a strong correlation, but if this is your core issue the income tax won't fix it. The wealthy would make long term, asset "freezing" positions to protect the wealth while not exposing it to income tax. Essentially, they quit earning money. We see this today, as you properly cite, in tax structures to optimize gains out of long term capital investment positions instead of regular income. It's a standard tax strategy employed not only by the wealthy, but even ordinary income Americans who invest post-tax in the stock market, or have options or stock plans at work. (Ever heard of an 83b election?) This is an interesting point, because it's exactly this kind of tax policy/social engineering meddling that in a way lead to this mess. As a country, we decided a long time ago a long term investment was more valuable than a short term one, so we decided to provide an incentive for doing just that in the tax code. The drawback is, it ties up capital, and it encourages gaming the system for tax liability advantage. One of the things Obama's commission on taxation proposed was to get rid of a lot of these little complexities in the tax code and replace more of them with regular, though at a lower percentage, income tax. It would encourage some additional liquidity, I believe, and ultimately I think it's a lot more fair to everyone. It should also slightly bias overall tax liability in a progressive fashion compared to the present configuration. Now, what I think you are looking for is some kind of asset tax, where essentially all assets are taxed, as opposed to income. It's an interesting idea -- I don't know that it's every been tried outside of local tax concepts like property tax. It would discourage saving to some extent, I believe, and probably encourage off-shoring assets or doing additional tax avoidance schemes like private placement life insurance, which because of the costs and scales involved, really truly are only available to the wealthy. > RR getting loopholes? Capital gains taxes would be a good start. It's not a loophole. It's tax law available to anyone. LTCG works for stocks held long enough, for example, whether one share or one-hundred-thousand shares. > US highest corporate tax rates? try again http://en.wikipedia.org/wiki/Tax_rates_around_the_ world Look again. The chart is very clear. We are #2. > 180 degrees off, Taxes are NOT progressive for Richy Rich they are more > regressive than they have been in 60 years. The definition of a regressive tax is one that gets relatively less expensive as income rises. A progressive tax is one that gets relatively more expensive as income rises. Like almost all income tax systems in the world, the United States has a progressive income tax. This is not up for debate. Now, you can argue we are far less progressive today than we were during Kennedy's presidency, for example, when the highest tax bracket was something like 90%. But, that's really a different argument. > Why do you think it is more important to defend the rich when I have > mentioned homelessness several times? I don't defend the rich. I believe your understanding and facts are quite wrong. > I have no solution to offer regarding outsourcing other than to see > international wages rise to our standard. I believe you are 100% correct. Of course, pressure on governments like China to float their currency fairly will also help to a small degree accelerate this standard, so I think that's a good idea, like you do. > Of course, that is against the best interest of our corporate oligarchy, so will never happen. Honestly, I'm not sure about this one. At least from the IT industry perspective I'm happy to report it's a ROYAL PAIN IN THE ASS to outsource and make it work effectively. And, often it crashes and burns in a spectacular ball of fire. At my employer, all R&D is done in California and in New England, at premium wages, and it's still way cheaper than outsourcing. From my perspective, outsourcing only works for highly commodity skills and labor. If it's specialized at all, or requires significant teamwork to make it work, outsourcing blows. > I also wanted to say I am impressed that this discussion has remained more civil > than these debates usually do and for that I am grateful. Of course. We agree to disagree, not be a$$holes and name callers. And, anyway, how else will I get you to come around  | ||
| Kenm123t |
The Union busting you speak of was caused by the Air traffic controllers union. They did not understand leadership or power. No President will be black mailed by any one or Union. The air traffic controllers decided they could hold air travelers hostage. Negotions broke down they ATC union we will show you. The Pres said NO Ill show you. Rule one know your limitations and dont piss off the Boss no matter how much you think your justified. There is always a line in the sand with Unions push too much and its game over. Any sitting President will not be black black mailed. They chose poorly | ||
| Dannybuell |
"Essentially, they quit earning money." Do they put it under their mattresses? Capital gains..."It's tax law available to anyone". Yes, anyone with money. the more money you have the sweeter the deal. Wage earners, the poor and homeless should be a national priority. The savings and spending habits of the top 10% to 1% don't satisfy any part of the population other than themselves. Their dollars do not multiply, their dollars make no social investment albeit Bill Gates, Warren Buffet and a few others. For hundreds of years Noblesse Oblige, nobility is obliged was the rule between the classes. For the last 30 years through careful use of the media and manipulation of the religious right it is now "la noblesse n'est pas obligé" or the nobility is not obliged. In Oregon I have seen outsourcing displace many IT workers and many of my peers have told similar tales about their workplace. You are lucky where you are. Have you read "the world is flat" by thomas friedman? | ||
| Dannybuell |
Kenm123t - I nor any of my family has ever been in a union going back hundreds of years. Union busting began with Jimmy Carter and the Teamsters truckers strike. Ronald Reagan took office and carried the baton by not entering into negotiations in good faith with the air traffic controllers. When two presidents in a row disregard collective bargaining the handwriting is on the wall for everyone to see. Union busting hit high gear after that. Many of Oregon's lumber mill towns closed down in the eighties and later reopened as non union shops under new ownership. | ||
| Court |
Reagan did not disregard the Collective Bargaining Agreement (which had a NO STRIKE clause) he was the one who adhered to it. The Air Traffic Controllers entered into a contractual agreement and violated their obligations. In the day when unions were a source of qualified, quality and efficient labor they were relevant. That history which explains why their membership has fallen like a rock. For more details see Union Sourcebook 1947-1983; U.S. Bureau of Labor Statistics (Message edited by court on December 27, 2010) | ||
| Dannybuell |
Court - Thank You on ATC strike details. "The unions have IN LARGE PART become lazy and are now a source of protection (examples abound here in NYC) for criminals, lazy and worthless employees. " that is kind of a national sentiment best documented at southern car manufacturing facilities where 'union' is a four letter word. (Message edited by dannybuell on December 27, 2010) | ||
| Court |
Southern cars . . San Francisco Levi's, light bulbs, cotton t-shirts, steel . . take your choice. | ||
| Jdugger |
> Do they put it under their mattresses? No, they put the capital in long term investments that appreciate without a realized gain. Long positions on equities, long term bonds, private equity, private placement life insurance, and so on. There are dozens if not hundreds of these types of investments that fit the bill. Do you know anything about finance or business? > Wage earners, the poor and homeless should > be a national priority. That may be how you feel, but how do you propose we pay for it, and what should be provided. Be careful... you can run up against the limits of money available in the world in a surprising hurry. > The savings and spending habits of the top 10% to 1% don't > satisfy any part of the population other than themselves. Their > dollars do not multiply, their dollars make no social investment Do you really feel this way? At best, this statement is unproductive, but at its worst, it's borderline hate speech. It's also vastly inaccurate, and we need look no further than the philanthropy of the private citizens of the United States to understand how out of touch on this topic you really are. | ||
| Court |
>>>>It's also vastly inaccurate It is so inaccurate as to indicate a total and complete lack of understanding. I wonder how that type or logic would explain away a $10,000,000 donation to the Boy Scouts of America to build a new camp . . the jobs that were created, the kids, from all social and economic backgrounds, that were exposed to learning and opportunity they'd never otherwise had known. Wow . . I think the fact that folks belief this stuff and the fact that about half the nation is on the public teet is really scary. |
