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Post by AztecWilliam on Aug 9, 2010 13:49:07 GMT -8
How rich is rich? In my view, I'd be rich if owned my home free and clear and maybe a little vacation bungalow, too. Furthermore, I would have to have a yearly after tax income of at least $250,000 with an additional couple of hundred thousand in the bank. Oh, yes, that quarter of a million would be coming in even if I stayed in bed all day. Now, the level of wealth mentioned above would seem like short rations to a Ketchup Lady and her ilk. A quarter of a million spendable per year would just about cover what they pay their household servants. So how rich is rich, and what level of taxation should a "rich" citizen pay? Here's an intriguing answer to that question . . . www.newyorker.com/talk/financial/2010/08/16/100816ta_talk_surowieckiAzWm PS: Pleasel don't ask me for a loan. I'm still trying to reach the level of wealth I suggested in my definition of "rich." |
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Post by aztec70 on Aug 9, 2010 14:01:11 GMT -8
That was an interesting article. I agree with it.
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Post by aztecwin on Aug 9, 2010 15:46:15 GMT -8
That was an interesting article. I agree with it. Strange as it may seem, so do I.  |
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Post by uwaztec on Aug 9, 2010 17:20:53 GMT -8
Yea...I do as well..
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Post by AztecWilliam on Aug 9, 2010 19:49:51 GMT -8
If a family makes $250,000 a year, then that is a rich family. That is all. Not necessarily. Someone making $250,000 a year is doing well, but perhaps he has several children, including one with special needs. Furthermore, he may be supporting an elderly relative. Finally, he may be plowing over half that amount back into the business he started and at which he works 60-80 hours a week. He may still be doing fairly well, but nothing like people whose net worth is counted in hundreds of millions of dollars and who benefit from very large investments in fax free bonds. The very, very rich have the resources to game the system in numerous ways and end up paying relatively little. The guy or gal making $250,000 a year is a piker by comparison. AzWm |
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Post by AztecWilliam on Aug 9, 2010 21:10:45 GMT -8
Not necessarily. Someone making $250,000 a year is doing well, but perhaps he has several children, including one with special needs. Furthermore, he may be supporting an elderly relative. Finally, he may be plowing over half that amount back into the business he started and at which he works 60-80 hours a week. AzWm Then he has chosen to spend his riches accordingly. One of us is missing the point. And it ain't me! AzWm |
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Post by aztec70 on Aug 9, 2010 23:12:56 GMT -8
If a family makes $250,000 a year, then that is a rich family. That is all. Not necessarily. Someone making $250,000 a year is doing well, but perhaps he has several children, including one with special needs. Furthermore, he may be supporting an elderly relative. Finally, he may be plowing over half that amount back into the business he started and at which he works 60-80 hours a week. He may still be doing fairly well, but nothing like people whose net worth is counted in hundreds of millions of dollars and who benefit from very large investments in fax free bonds. The very, very rich have the resources to game the system in numerous ways and end up paying relatively little. The guy or gal making $250,000 a year is a piker by comparison. AzWm |
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Post by The Great Aztec Joe on Aug 10, 2010 6:49:12 GMT -8
Not necessarily. Someone making $250,000 a year is doing well, but perhaps he has several children, including one with special needs. Furthermore, he may be supporting an elderly relative. Finally, he may be plowing over half that amount back into the business he started and at which he works 60-80 hours a week. He may still be doing fairly well, but nothing like people whose net worth is counted in hundreds of millions of dollars and who benefit from very large investments in fax free bonds. The very, very rich have the resources to game the system in numerous ways and end up paying relatively little. The guy or gal making $250,000 a year is a piker by comparison. AzWm I spent what would have been my wealth in raising kids. It was not an investment in my future, but in theirs. I will be comfortable in my retirement once I sell this mega house. It is still mortgaged because it was my "BANK" while I was raising all of those kids. My wife was a full time housewife for 30 years. She is now working part time jobs (Tutoring, Pool monitor) as she is ticking off the final years until she is 62 and will be able to draw Social Security. I am looking forward to the time when the live at home children will leave the house, so I can sell it. One 25 year old daughter plans on moving out next month to Fungus flats. But I still have a 35 year old divorced step son and his three kids living here, and a younger adopted Korean son who may never be fully independent, and a 21 year old Music Math major who might finish up his college in two more years. Of course, then he might decide to work in his Masters. Somehow, I get the feeling I am going to die before I can sell this big house. Such is life some times. |
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Post by Yoda on Aug 10, 2010 7:00:18 GMT -8
You folks are arguing over who is rich but I think the other half of that question is the more important part. To the extent that you are focusing on earned income thresholds at all, you're missing the big picture. Most of the "rich" earn most of their income, not as earned income but in the form of capital gains -- which are taxed at 15%. And as a result, as Warren Buffett pointed out a couple of years ago, the tax system allows him to pay a lower tax rate than his secretary pays. www.timesonline.co.uk/tol/money/tax/article1996735.eceLet's eliminate capital gains; it is nothing but a giant loophole. Let's also eliminate corporate income tax; that's nothing but double taxation and it makes our products more expensive overseas. Oh and what the hell, while we're at it, let's bring Social Security and Medicare on budget -- and eliminate those taxes as well. And finally, let's means test both, with Social Security becoming a minimum national income for those age 70 and above. With most everything on budget, we can adjust marginal tax rates at that point. And people can really see what they are paying in taxes instead of burying all of them in different places. Yoda out... |
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Post by aztec70 on Aug 10, 2010 8:56:03 GMT -8
$250,000 after tax income is a lot of money. If that were guaranteed for the rest of my life I would think myself rich.
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Post by aztecwin on Aug 10, 2010 11:58:40 GMT -8
If $250K were coming in and there was safety in that income stream, I would think I was very rich. I think that some of the things that we bring up about small business and such were mentioned although I did not go back and read it again. In general, I agree with the major points in the article.
I have some concern that the government might not be able to allot the tax money of the super rich as well as the private ad visors of the super rich, but somehow we have to balance the budget.
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Post by Yoda on Aug 10, 2010 12:45:11 GMT -8
There is a huge difference between having a high income and being rich. Rich is a measurement of wealth; a function of how many net assets you have.
There are lots of people with high incomes that have few assets and a lot of rich people have low incomes. Myself, I had a net taxable income of over $500,000 in 2003 and I have had an income of less than zero for the past three years. I wasn't rich in 2003 and I'm not poor now.
"Rich" is a measurement of wealth; not income -- and especially not earned income.
Yoda out...
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Post by aztec70 on Aug 10, 2010 12:54:39 GMT -8
Yoda, your points are good, but not on topic. We are talking about having 250K after tax income and not having to get out of bed. That is either one great pension( must be former City of Bell employee), or an income stream that is secured by rock solid assets. If it is the later we are talking 10 million dollars or so. Either way the income stream is wealth. An income stream is an asset.
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Post by aztecwin on Aug 10, 2010 13:03:42 GMT -8
Yoda, your points are good, but not on topic. We are talking about having 250K after tax income and not having to get out of bed. That is either one great pension( must be former City of Bell employee), or an income stream that is secured by rock solid assets. If it is the later we are talking 10 million dollars or so. Either way the income stream is wealth. An income stream is an asset. You are correct, but Yoda points out that things are not always what they seem. |
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Post by Yoda on Aug 10, 2010 13:18:30 GMT -8
Yoda, your points are good, but not on topic. We are talking about having 250K after tax income and not having to get out of bed. That is either one great pension( must be former City of Bell employee), or an income stream that is secured by rock solid assets. If it is the later we are talking 10 million dollars or so. Either way the income stream is wealth. An income stream is an asset. Are you? It seems to me that the article sprang from a discussion about whether or not Obama's proposal to extend the Bush tax cuts should or should not extend to those making more than $200,000 / $250,000 -- or as he put it, "the rich". It is his original definition and I'm saying that that definition -- along with the discussion on this board about whether or not that (or some other) level constituted "rich" -- are fundamentally flawed. The Bush tax cuts applied to earned income only -- not to capital gains and by narrowing the discussion to earned income only, the whole discussion of what is "rich" becomes meaningless. Rich has nothing to do with earned income. Rich is a function of wealth. I mean if you limit the discussion to earned income, then Warren Buffett isn't wealthy. He pays himself $100,000 a year (as I recall -- he may have had to kick it up some). Now I understand that if you have a net, after tax income of $250,000, you'd probably feel pretty "rich" but as others have pointed out, that depends on what your expenses are. I was told today that my dad needs to go into a home. There are two choices (so far -- we've just started looking). One is $6,000 a month and the other is $20,000 a month. Sorry Dad. In a good year, I'm "rich". I just don't have that kind of money... Yoda out... |
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Post by The Great Aztec Joe on Aug 10, 2010 13:25:07 GMT -8
Flat Tax 50% of everything earned that is above $30,000 a year. The state can take the rest as needed. Fug the Rich.
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Post by Yoda on Aug 10, 2010 13:39:00 GMT -8
Flat Tax 50% of everything earned that is above $30,000 a year. The state can take the rest as needed. Fug the Rich. So you want me to reduce my salary to $30,000 and grant myself generous stock options? Income earned from stock options is not earned income and you are only taxing earned income. Yoda out... |
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Post by AztecWilliam on Aug 10, 2010 13:41:55 GMT -8
Yes, wealth is not the same as income. That was the point I was trying to make with my hypothetical taxpayer who made $250,000 a year but had many mouths to feed and a struggling business to support.
Here's another hypothetical. Let's assume this guy is 45 years old. At 25 he started a website that took off like gangbusters. Pretty soon he was making lots and lots of money, most of which he used to finance expansion of what had become a thriving business. Now he decides to retire. He sells his business for a net gain of 10 million.
He is single, his parents are comfortably retired with good pensions, and his siblings are all doing well. He lives in a house that he paid off over the years with part of the income from his business. Even at a paltry interest rate of 2.5%, his nest age of 10 million (let's assume it's in a bank savings account) will bring him the same $250,000 a year that the other guy has to work 60,70, or 80 hours a weak to earn.
Which is rich? Well, the 45 year old seems richer, and I would call myself rich if I were in his shoes. Still, neither is rich compared with the super rich whose wealth is counted in the hundreds of millions of dollars.
Notice that the Democrats never propose a "wealth tax." They could propose a tax of 10% per year on all personal wealth over, let's say, $100,000,000. Why don't they do that? After all, wouldn't that be "fair"? The little guy works for his money, and the really rich just fool around while their investments bring them millions a year with which to make possible their yachts and trips to the French Riviera?
So, if the Democrats are the champions of the poor and want to stick it to the rich, why don't they tax the excess wealth possessed by many whose toughest work is to decide which kind of wine is correct to serve with fish? They don't for one very good reason. The Democrats are every bit as much in bed with the super rich as are the Republicans. Furthermore, the Democrats know that to achieve their goals for this country they are going to have to tax every one of the top 50% of wage earners a lot more than they do now.
AzWm
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Post by AztecWilliam on Aug 10, 2010 13:46:56 GMT -8
I am sure that you were just dying to know the answer to the question facing those multi-billionaires. They should order white win with fish.
Just thought you might want to keep that in mind for the day when your ship comes in. ;D
AzWm
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Post by davdesid on Aug 10, 2010 13:50:15 GMT -8
>>>They could propose a tax of 10% per year on all personal wealth over, let's say, $100,000.<<<
So, anyone with a home, a savings account with a few bucks in it, and an income that barely keeps them above water has to cough up at least 10 grand a year in addition to the other taxes they have to pay?
Bring on the Zyklon B shower.
Or did you mean $100,000,000?
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