The President Thinks the 1%er's Don't Pay Their Share

[tskeeter]

But some of the ultra wealthy pay so much in state taxes that their tax payments can affect state budgets.  How bout that?

finance.yahoo.com/news/connecticut-super-rich-residents-please-dont-leave-us-191244214.html

[ArchietheDragon]

Please don't move to Florida. 

[Opti]

flowingdata.com/2013/04/16/wealth-distribution-in-america/

Watch the video, nice graphics. Around the 4 minute mark to 4:46 it graphically

shows how the 1% having 40% of the entire wealth really looks.

[Opti]

Yeah, 40% of the wealth affecting budgets, how not shocking.

[TheHaitian]

Am I the only one that think that when Obama is talking about the 1% he is not talking about the super rich but more so the upper class?

Doctors? Lawyers? Dentists? Educators? Small Business Owners? Executives? Middle Managements?

I am thinking 200k-500k income, rich but not filthy rich?

Because the Walton, Kennedy, hedge fund managers of the world do not care or rely heavily on 529's, 401k's, or ROTH.

But the upper middle class that is trying to protect what they have, plan for tomorrow, guarantee their kids a better education are.

I bet you truly rich people, their lawyers and financial advisors are just seating back and laughing at his attempts and saying: let's see who this screws over because it surely won't be us.

[Opti]

Feb 10, 2015 14:11:24 GMT -5 TheHaitian said:

Am I the only one that think that when Obama is talking about the 1% he is not talking about the super rich but more so the upper class?

Doctors? Lawyers? Dentists? Educators? Small Business Owners? Executives? Middle Managements?

I am thinking 200k-500k income, rich but not filthy rich?

Because the Walton, Kennedy, hedge fund managers of the world do not care or rely heavily on 529's, 401k's, or ROTH.

But the upper middle class that is trying to protect what they have, plan for tomorrow, guarantee their kids a better education are.

I bet you truly rich people, their lawyers and financial advisors are just seating back and laughing at his attempts and saying: let's see who this screws over because it surely won't be us.

Don't know, but perception is perception. The top 20% currently have 89% of the wealth and

the remaining 80% have 11%. Might be why going after the bottom 40% is a fool's errand. As a group

they might possess a small non-zero income but as a group their wealth is negative.

The Wealth Distribution

In the United States, wealth is highly concentrated in a relatively few hands. As of 2010, the top 1% of households (the upper class) owned 35.4% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 53.5%, which means that just 20% of the people owned a remarkable 89%, leaving only 11% of the wealth for the bottom 80% (wage and salary workers). In terms of financial wealth (total net worth

www2.ucsc.edu/whorulesamerica/power/wealth.html

Some cool charts including a table showing the bottom 40% has negative net worth looking

at the mean.

[NomoreDramaQ1015]

Feb 10, 2015 14:11:24 GMT -5 TheHaitian said:

Am I the only one that think that when Obama is talking about the 1% he is not talking about the super rich but more so the upper class?

Doctors? Lawyers? Dentists? Educators? Small Business Owners? Executives? Middle Managements?

I am thinking 200k-500k income, rich but not filthy rich?

Because the Walton, Kennedy, hedge fund managers of the world do not care or rely heavily on 529's, 401k's, or ROTH.

But the upper middle class that is trying to protect what they have, plan for tomorrow, guarantee their kids a better education are.

I bet you truly rich people, their lawyers and financial advisors are just seating back and laughing at his attempts and saying: let's see who this screws over because it surely won't be us.

No I think the same thing.

The 529 taxation talks were interesting.  I never realized that at a little over $60k gross that Dh and I are apparently evil 1%-ers. 

Sure doesn't feel like it.

The actual RICH people they think this would target like Buffet or Gates make more in a hour than they will be taxed.  Plus they have a lot more options for shuffling their money around avoiding all these tax traps.

Meanwhile those of that that actually feel the squeeze are the middle class who don't have a ton of options to move our "wealth" around and don't have much of it to begin with.

[TheHaitian]

Feb 10, 2015 14:20:45 GMT -5 NomoreDramaQ1015 said:

The actual RICH people they think this would target like Buffet or Gates make more in a hour than they will be taxed.  Plus they have a lot more options for shuffling their money around avoiding all these tax traps.

Meanwhile those of that that actually feel the squeeze are the middle class who don't have a ton of options to move our "wealth" around and don't have much of it to begin with.

Exactly!!!

I think people really need to get a better understanding between comfortable , rich, and truly wealthy.

[phil5185]

Is income gap a world-wide issue? Canada and the Brits seem to be pondreing the same thing? OTOH, what is the problem with 'income gap' - it is usually couched in pejoratives to make sure that readers know that it is "bad" - but what's wrong with it? (I've known all my life that the rich people have the money, that's why they're called rich.)
But, other than envy, why is it an economic problem?

OTTAWA -- Canada is among the worst countries in the developed world in terms of the widening income gap between top earners and others in society, according to the Organization for Economic Co-operation and Development.

The analysis shows income inequality is on the rise in most developed economies, but the trend has particularly taken hold in the United States and Canada.

The OECD report shows the top one per cent of Canadian pre-tax income earners captured 37 per cent of the overall income growth between 1981 and 2012, and now swallow up 12.2 per cent of the country's income pie.

Read more: www.ctvnews.ca/business/canada-s-income-gap-among-fastest-growing-in-the-oecd-1.1799525#ixzz3ROHmfwt1

Income inequality growing faster in UK than any other rich country, says OECD
Top 10% have incomes 12 times greater than bottom 10%, up from eight times greater in 1985, thinktank's study reveals
Occupy protesters
Protesters against income inequality in London. The OECD said the share of the top 1% had increased from 7.1% in 1970 to 14.3% in 2005.
Income inequality among working-age people has risen faster in Britain than in any other rich nation since the mid-1970s, according to a report by the OECD.

The thinktank says the gap has come about due to the rise of a financial services elite who, through education and marriage, have concentrated wealth into the hands of a tiny minority.

Economists from the group, which is funded by developed-world taxpayers, say the annual average income in the UK of the top 10% in 2008 was just under £55,000, about 12 times higher than that of the bottom 10%, who had an average income of £4,700.

This is up from a ratio of eight to one in 1985 and significantly higher than the average income gap in developed nations of nine to one.

However, the report makes clear that even in countries viewed as "fairer" – such as Germany, Denmark and Sweden – this pay gap between rich and poor is expanding: from five to one in the 1980s to six to one today. In the rising powers of Brazil, Russia, India and China, the ratio is an alarming 50 to one.

The OECD warned about the rise of the top 1% in rich societies and the falling share of income going to poorer people.

[Deleted]

Feb 10, 2015 19:23:05 GMT -5 phil5185 said:

Is income gap a world-wide issue? Canada and the Brits seem to be pondreing the same thing? OTOH, what is the problem with 'income gap' - it is usually couched in pejoratives to make sure that readers know that it is "bad" - but what's wrong with it? (I've known all my life that the rich people have the money, that's why they're called rich.)
But, other than envy, why is it an economic problem?

OTTAWA -- Canada is among the worst countries in the developed world in terms of the widening income gap between top earners and others in society, according to the Organization for Economic Co-operation and Development.

The analysis shows income inequality is on the rise in most developed economies, but the trend has particularly taken hold in the United States and Canada.

The OECD report shows the top one per cent of Canadian pre-tax income earners captured 37 per cent of the overall income growth between 1981 and 2012, and now swallow up 12.2 per cent of the country's income pie.

Read more: www.ctvnews.ca/business/canada-s-income-gap-among-fastest-growing-in-the-oecd-1.1799525#ixzz3ROHmfwt1

Income inequality growing faster in UK than any other rich country, says OECD
Top 10% have incomes 12 times greater than bottom 10%, up from eight times greater in 1985, thinktank's study reveals
Occupy protesters
Protesters against income inequality in London. The OECD said the share of the top 1% had increased from 7.1% in 1970 to 14.3% in 2005.
Income inequality among working-age people has risen faster in Britain than in any other rich nation since the mid-1970s, according to a report by the OECD.

The thinktank says the gap has come about due to the rise of a financial services elite who, through education and marriage, have concentrated wealth into the hands of a tiny minority.

Economists from the group, which is funded by developed-world taxpayers, say the annual average income in the UK of the top 10% in 2008 was just under £55,000, about 12 times higher than that of the bottom 10%, who had an average income of £4,700.

This is up from a ratio of eight to one in 1985 and significantly higher than the average income gap in developed nations of nine to one.

However, the report makes clear that even in countries viewed as "fairer" – such as Germany, Denmark and Sweden – this pay gap between rich and poor is expanding: from five to one in the 1980s to six to one today. In the rising powers of Brazil, Russia, India and China, the ratio is an alarming 50 to one.

The OECD warned about the rise of the top 1% in rich societies and the falling share of income going to poorer people.

I'd suggest you ask Marie Antoinette, but she lost her head. 

When the income gap isn't that great, the middle class tends to identify with the upper class.  That's understandable; they want to think that is achievable. 

These days the middle class tends to identify with the lower class.  They know that $100,000 or whatever just doesn't go that far.

By the way, $500,000 is still extremely rich, even if it isn't Bill Gates rich.  $500,000 is not "upper middle class."  It has definitely pushed over into at least "lower upper class."    The lines are fluid, but not that fluid.  Sure, $500,000 wouldn't buy you a house in the wealthiest neighborhoods, but at 3X income, you could surely buy a 1.5 million house.  Except in NYC and parts of California perhaps, that's an upper class neighborhood.

[Lizard Queen]

I think, with all of these proposals, Pres Obama has Mitt Romney's income tax rate in mind.

money.cnn.com/2012/09/21/pf/taxes/romney-tax-return/index.html

[kittensaver]

Feb 10, 2015 19:41:49 GMT -5 @southernsusana said:

Feb 10, 2015 19:23:05 GMT -5 phil5185 said:

Sure, $500,000 wouldn't buy you a house in the wealthiest neighborhoods, but at 3X income, you could surely buy a 1.5 million house.  Except in NYC and parts of California perhaps, that's an upper class neighborhood.

In La La Land (aka, Southern California), 500k will buy you a pretty nice house out in the suburbs that are 50+ miles (and farther) from the urban core. In the urban core and immediate ring around it, 500k will get you a decent condo or a small, run-down house with bars on the windows in a lower-income working class neighborhood.

[Deleted]

Feb 10, 2015 19:57:08 GMT -5 kittensaver said:

Feb 10, 2015 19:41:49 GMT -5 @southernsusana said:

Sure, $500,000 wouldn't buy you a house in the wealthiest neighborhoods, but at 3X income, you could surely buy a 1.5 million house.  Except in NYC and parts of California perhaps, that's an upper class neighborhood.

In La La Land (aka, Southern California), 500k will buy you a pretty nice house out in the suburbs that are 50+ miles (and farther) from the urban core. In the urban core and immediate ring around it, 500k will get you a decent condo or a small, run-down house with bars on the windows in a lower-income working class neighborhood.

Reread my post.  I already mentioned California.  I also am not talking about buying a $500,000 house.  Few people buy houses that are equal to their income.

I said a house 3X a $500,000 income--1.5 million--is almost always in an upper class neighborhood.  Again, excepting NYC and parts of California . . .

[kittensaver]

southernsusana: read and understood. I'm just pointing out the unique income and housing gaps here.

I agree with you - - a 1.5mil house here is solidly middle-class, not even close to upper class. In a La La Land upper class neighborhood, houses start in the 3-5 mil range. A tiny bungalow in the Hollywood Hills can easily run you 2 mil+.

[phil5185]

I'd suggest you ask Marie Antoinette, but she lost her head.

LOL - yes - let them eat cake.
But really -  other than envy, why is it an economic problem? 

However, the report makes clear that even in countries viewed as "fairer" – such as Germany, Denmark and Sweden – this pay gap between rich and poor is expanding: from five to one in the 1980s to six to one today. In the rising powers of Brazil, Russia, India and China, the ratio is an alarming 50 to one.

If I'm a $100k wage earner engineer, do I care if my company CEO is making $600,000 (6X) or $5,000,000 (50X)?   The largest companies - GE, McD, HP, Home Depot have 300,000 to 500,000 employees, they need a $10M to $20M super star CEO.  Conversely a CEO of a 100 person company might earn $500k to $1m.  The major factor in the rise in US CEO salaries during the last couple decades is corporate-size, mergers and acquisitions.  Eg, at one time Yum Brands was KFC, Taco Bell, Pizza Hut, Wing Street, A&W Root Beer, Long John. 

[beergut]

Feb 10, 2015 14:19:25 GMT -5 Opti said:

Feb 10, 2015 14:11:24 GMT -5 TheHaitian said:

Am I the only one that think that when Obama is talking about the 1% he is not talking about the super rich but more so the upper class?

Doctors? Lawyers? Dentists? Educators? Small Business Owners? Executives? Middle Managements?

I am thinking 200k-500k income, rich but not filthy rich?

Because the Walton, Kennedy, hedge fund managers of the world do not care or rely heavily on 529's, 401k's, or ROTH.

But the upper middle class that is trying to protect what they have, plan for tomorrow, guarantee their kids a better education are.

I bet you truly rich people, their lawyers and financial advisors are just seating back and laughing at his attempts and saying: let's see who this screws over because it surely won't be us.

Don't know, but perception is perception. The top 20% currently have 89% of the wealth and

the remaining 80% have 11%. Might be why going after the bottom 40% is a fool's errand. As a group

they might possess a small non-zero income but as a group their wealth is negative.

The Wealth Distribution

In the United States, wealth is highly concentrated in a relatively few hands. As of 2010, the top 1% of households (the upper class) owned 35.4% of all privately held wealth, and the next 19% (the managerial, professional, and small business stratum) had 53.5%, which means that just 20% of the people owned a remarkable 89%, leaving only 11% of the wealth for the bottom 80% (wage and salary workers). In terms of financial wealth (total net worth

www2.ucsc.edu/whorulesamerica/power/wealth.html

Some cool charts including a table showing the bottom 40% has negative net worth looking

at the mean.

The main problem is defining economic status purely by looking at net worth. If you finance your college education totally on loans, and graduate with $100k in debt, you have a hugely negative net worth. A person with $1 has a higher net worth than you. The same situation exists for people who buy a home with a mortgage, it makes their net worth a large negative number. Saying one person in the top 10% has a higher net worth than the bottom 50% combined is misleading, because the majority of the bottom 50% may merely be people with student loans or mortgages, which gives them a negative net worth. 

If you said a homeless guy on the street who made $10 panhandling in the last hour has a higher net worth than the bottom 50% combined, it doesn't sounds as impressive, does it? It doesn't encourage class warfare, does it?

[resolution]

A mortgage doesn't contribute to negative net worth unless the value of the house is lower than the outstanding balance. The house is actually the largest contributor to positive net worth for most middle class families.

Student loans are becoming more and more of an issue and I am concerned about the impact it will have on the younger generations.