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Post by Deleted on Mar 25, 2011 9:27:00 GMT -5
"47% of the wage earning population pays no federal incomes anyway."
That's because the lowest 50% share 12.5% of the total agi... which means the bottom 50% all together earn less than the top 1% ... even though the bottom 50% is represented by 69,980,290 returns... and the top1% is represented by 1,399,606 returns...
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Post by Savoir Faire-Demogague in NJ on Mar 25, 2011 9:27:08 GMT -5
And health insurance premiums paid by you do not lower your AGI, unless you are talking HSA contributions, which most people do not have. You are incorrect. Health care premium contributions paid by employees out of their pay checks are pre-tax. And 138 million tax returns could also hardly note 401K ... since there are only around 50 million Americans with 401ks... and that was in 2006... before our most current crisis... wanna bet which percentage of lower/higher income people have a 401K? www.ebri.org/pdf/briefspdf/EBRI_IB_08-20073.pdfA family of four can earn nearly $28,000 in income that is all tax free, with the Standard Deduction and four exemptions.
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Post by Savoir Faire-Demogague in NJ on Mar 25, 2011 9:28:44 GMT -5
That's because the lowest 50% share 12.5% of the total agi... which means the bottom 50% all together earn less than the top 1% ... even though the bottom 50% is represented by 69,980,290 returns... and the top1% is represented by 1,399,606 returns...
And? So? The issue is what? The govt has been trying to eliminate this gap for nearly 40 years, every piece of legislation has made this worse.
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swamp
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Post by swamp on Mar 25, 2011 9:30:04 GMT -5
So, they can just up and decide they don't want to pay them or be held accountable for what is promised? I would think the fact that they can just bail whenever they want rather than live up to their obligations would be a greater concern than the money they actually pay out. I'm unaware of any proposals to change the past promises. These proposals which are popping up everywhere across the country are VERY modest changes to existing and future public employees. So, nobody is "bailing" on anything. However, if these changes don't pass and we start looking at gov't bankruptcies- that will change the deal for sure. The question retirees ought to ask themselves is whether or not they will risk their own retirement security supporting the recent excesses of current workers? Something I let slide from the OP is Penny's story. As someone that pays for my own healthcare, I'm interested to know what plan she's got where 13% of the premium is $600 each month. That means that her health plan's total premium is $4,615 each month, or $55,380 a year. Anyone besides me think that Penny is full of sh**, or just flat doesn't have her facts right? For $55k a year, I'd self insure............ I think Penny is confuzzled.
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Post by Deleted on Mar 25, 2011 9:31:34 GMT -5
Standard Deductions and four exemptions are AFTER the AGI and therefore irrelavant to this discussion of what AGI includes...
I'll look up the health care stuff... thanks.
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Post by Deleted on Mar 25, 2011 9:33:12 GMT -5
Not everything has made it worse SF... its just that we keep ignoring what actually works...
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formerexpat
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Post by formerexpat on Mar 25, 2011 9:35:40 GMT -5
Most of the problems for the governments across the US [as well as many in Europe] and their ability to live within their means IS the public sector wages being out of line with reality, and even more so, the post retirement benefits that are unreasonable. These benefits simply can't be paid in full and are no worse than CEO golden parachutes in the way some of these unions forced states into these contracts...i.e. holding your children hostage.
When the tax payers pay the private industry wages, then they can care about those. Sometimes its tough to face reality though. Some may not like the words from Christie but the man doesn't mince his words nor does he sugar coat them. Some need the coddling; others prefer straight talk.
When talking about the budget gaps in NJ, the private industry wages have nothing to do with the equation. On the other hand, the fact that the public employees and their post retirement benefits are strangling the state's [and many others] financial health has all to do with the equation.
If these benefits cannot be renegotiated and/or changed, I would expect to see states taking action to default on debts to force negotiations. These obligations will not / cannot be paid. Plain and simple. Can't say it any clearer than that.
We're talking about AGI and gross income; not federal taxes paid. Oped claimed the top 1% makes 20% of all income.
I'm letting her know that what she posted was AGI statistics and that after increasing the denominator by the deductions to get to AGI, the percentage of ALL income that the top 1% makes is likely closer to 15-17%...like it has been for decades [if you adjust pre 86 numbers for the changed definition of AGI]. [/size]
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Post by Savoir Faire-Demogague in NJ on Mar 25, 2011 9:36:06 GMT -5
Standard Deductions and four exemptions are AFTER the AGI and therefore irrelavant to this discussion of what AGI includes...
I'll look up the health care stuff... thanks.
The standard deduction reduces gross pay, and is what the tax is calculated on. There is no need to look up health care premiums, they are pre-tax.
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fairlycrazy23
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Post by fairlycrazy23 on Mar 25, 2011 9:41:25 GMT -5
Employers providing health care never should have become common in the first place, this was brought on by wage controls set up by the government. Then the abomination known as the HMO act of 73 made it worse.
Private wages do have an effect on Government revenue, higher wages equal more tax revenue.
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formerexpat
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Post by formerexpat on Mar 25, 2011 9:44:17 GMT -5
It's no secret on these boards that I came out of college with $100k of student loans. I paid much more than $2.5k per year in interest; $2.5k is the maximum deduction.
I did it while paying down my $100k in student loans and making $40k in a mid-high COLA area. Not sure how much reading I need to do; pretty sure I lived it.
The point is that everyone doesn't need to have the exact same deductions as I did in my example. Even better, if you don't have $2.5k of student loan interest to pay [BTW, mine was in excess of $5k, so I couldn't deduct $2.5k of the interest I paid], THEN INCREASE YOUR 401K CONTRIBUTIONS.
Most people live out of touch with reality and what they can really afford financially. They prioritize ass backwards and place importance over too large of a home, a car they can't afford and the latest gadgets at the detriment of their financial future and taking deductions that they CAN get.
Whether they take them or not is completely irrelevant. If you want to argue that most the population is piss poor at saving for their own future, I have no sympathy. [/size]
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Post by Savoir Faire-Demogague in NJ on Mar 25, 2011 9:46:29 GMT -5
Whether they take them or not is completely irrelevant. If you want to argue that most the population is piss poor at saving for their own future, I have no sympathy.
I put the blame on the failure of US public education, and the femization of society the last 25 or so years.
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swamp
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Post by swamp on Mar 25, 2011 9:48:37 GMT -5
Whether they take them or not is completely irrelevant. If you want to argue that most the population is piss poor at saving for their own future, I have no sympathy.I put the blame on the failure of US public education, and the femization of society the last 25 or so years. I put the blame on parents who spoil their kids and give them everything.
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AgeOfEnlightenmentSCP
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Post by AgeOfEnlightenmentSCP on Mar 25, 2011 9:50:27 GMT -5
And health insurance premiums paid by you do not lower your AGI, unless you are talking HSA contributions, which most people do not have. You are incorrect. Health care premium contributions paid by employees out of their pay checks are pre-tax. And 138 million tax returns could also hardly note 401K ... since there are only around 50 million Americans with 401ks... and that was in 2006... before our most current crisis... wanna bet which percentage of lower/higher income people have a 401K? www.ebri.org/pdf/briefspdf/EBRI_IB_08-20073.pdfA family of four can earn nearly $28,000 in income that is all tax free, with the Standard Deduction and four exemptions. And if that same family would just cut back to $15,500 (min wage) they could not only live tax-free, but they could actually have a better standard of living than a family earning $60,000 a year. www.zerohedge.com/article/entitlement-america-head-household-making-minimum-wage-has-more-disposable-income-family-mak It's a fact- and it all ties into the point that almost 35% of Americans need to get: your nieghbors aren't going to carry your lazy a** anymore. www.cnbc.com/id/41969508/
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AgeOfEnlightenmentSCP
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Post by AgeOfEnlightenmentSCP on Mar 25, 2011 9:57:24 GMT -5
Whether they take them or not is completely irrelevant. If you want to argue that most the population is piss poor at saving for their own future, I have no sympathy.I put the blame on the failure of US public education, and the femization of society the last 25 or so years. I put the blame on parents who spoil their kids and give them everything. It really doesn't matter whose fault it is at this point. It certainly does matter who the obstacles are to fixing it- those folks will have to be dealt with in election after election after election-- 2010 was a very modest start to what is going to become a ballot box tradition-- I'm convinced of this. I actually think it goes back further- it goes back to the false promises made under FDR that government can fix the market cycle (it can exacerbate a bad situation, but it can't fix anything), and giving in to the well-meaning, but disasterous temptation to give the "greatest generation" whatever they wanted, and their giving in to the well-meaning, but disasterous temptation to "make sure their kids never have to suffer like they did" during the "Goverment Depression" and the world war.
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Bluerobin
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Post by Bluerobin on Mar 25, 2011 9:57:59 GMT -5
PBP, the only problem with that is a family can't live on that little. You $10 an hour types really amaze me. Only illegals, living 30 to a room think that is a good wage. We do have to bring the average wage in the private sector up quite a bit. Then fewer will complain about taxes. Pay the CEO less, unless he owns the company, pay the employees more, and most will be happy.
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gooddecisions
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Post by gooddecisions on Mar 25, 2011 10:02:34 GMT -5
"Something I let slide from the OP is Penny's story. As someone that pays for my own healthcare, I'm interested to know what plan she's got where 13% of the premium is $600 each month. That means that her health plan's total premium is $4,615 each month, or $55,380 a year."
This was my first reaction when I read the scenario. No way in h--- her premiums increased that much. Just another idiot calling in who doesn't understand her own finances much less know anything about economics.
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gooddecisions
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Post by gooddecisions on Mar 25, 2011 10:08:09 GMT -5
"Pay the CEO less, unless he owns the company, pay the employees more, and most will be happy."
The CEO at my company made $6MM last year. Take that number and divide it by the 300,000 employees and each employee gets a $20 annual increase. What did that do exactly except take away the salary of someone who very much earned it?
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Bluerobin
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Post by Bluerobin on Mar 25, 2011 10:11:08 GMT -5
good, I never said give to the workers. Don't forget the shareholders. Our returns are counted in pennies. No one is worth that much, unless he is the owner.
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gooddecisions
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Post by gooddecisions on Mar 25, 2011 10:19:53 GMT -5
Fair enough, but when you said pay the CEO less and pay the employees more, that is what you implied. As far as pay the shareholders more, my experience is that shuffling money away from the CEO results in decreases to shareholder values- not increases.
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AgeOfEnlightenmentSCP
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Post by AgeOfEnlightenmentSCP on Mar 25, 2011 10:40:31 GMT -5
Fair enough, but when you said pay the CEO less and pay the employees more, that is what you implied. As far as pay the shareholders more, my experience is that shuffling money away from the CEO results in decreases to shareholder values- not increases. You are EXACTLY right. I don't know if the people's opinions of CEO pay are the result of ignorance, envy, or just good old fashioned stupidity-- but I like to give them the benefit of the doubt and assume they're ignorant. Many people don't understand, and therefore fear and mistrust the free market. They don't have the facts, they aren't well informed, and that's how we end up having these discussions about people being paid too much money-- be they athletes, or CEOs. Let's take a single company- Met Life, Inc. and just get an overview: MetLife, Inc. is a leading global provider of insurance, annuities and employee benefit programs, serving 90 million customers in over 60 countries. Through its subsidiaries and affiliates, MetLife holds leading market positions in the United States, Japan, Latin America, Asia Pacific, Europe and the Middle East. The company had just shy of $3 billion in net income in 2010. They made investments of $10 billion in private placements. You tell me who is qualified to run this company? My guess? Fewer than 1,000 people on a planet of 6.6 billion people. What do you pay a CEO that runs the operation that brings in $3 BILLION dollars- a 65% increase in operating earnings? It sort of puts the Chairman of the Board of Directors, President, and Chief Executive Officer, Robert Henrikson's $11 million and change in perspective-- especially when you consider that is DOWN over 50% from his 2009 total compensation of $22 million and change.
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Angel!
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Post by Angel! on Mar 25, 2011 12:25:44 GMT -5
"Something I let slide from the OP is Penny's story. As someone that pays for my own healthcare, I'm interested to know what plan she's got where 13% of the premium is $600 each month. That means that her health plan's total premium is $4,615 each month, or $55,380 a year." This was my first reaction when I read the scenario. No way in h--- her premiums increased that much. Just another idiot calling in who doesn't understand her own finances much less know anything about economics. You guys aren't reading it right. 13% of workers pay will be taken out to pay for premiums. She said that equals $600/month for her family, which means they currently make around $55K. She is essentially being given a 13% paycut. Christie says she can move to a cheaper plan, but I don't know the details of what insurance options they have. If there are reasonable, cheaper plans that wouldn't cut her pay nearly so much, then this seems ok. But, why doesn't the state just take away the top tier plan completely then?
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Angel!
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Post by Angel! on Mar 25, 2011 12:28:45 GMT -5
We have gone over this chart before, it is complete BS. The standard family making 60K does not have less disposable income that one making minimum wage.
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formerexpat
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Post by formerexpat on Mar 25, 2011 12:32:40 GMT -5
I would agree with this. Parents today are too quick to blame the education system and the teachers because it's easier than looking in the mirror and finding faults as a parent.
That's not to say that our public K-12 education isn't horrible for the amount we pay per student - it is, but we can't use that as a reason people don't understand basic finance. [/size]
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Bluerobin
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Post by Bluerobin on Mar 25, 2011 12:41:09 GMT -5
PBP, you go back to Chrysler of the 1980 era. Lee Iococca got $1 a year. The rest was all performance based. These multi million dollar salaries are BS, and unwarrented. Pay the the $1 and base bonus on a percentage of the increase over last year. No increase, give them a marginal salary. Do put a limit on the compensation, because no one other than an owner is worth what their egos demand.
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hello fromWarsaw
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Post by hello fromWarsaw on Mar 25, 2011 12:50:26 GMT -5
In 1950, the average CEO got 23x the pay of the average worker. Now it's 300+X. Obscene. Higher taxes for the mega rich helps with this.
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formerexpat
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Post by formerexpat on Mar 25, 2011 12:54:47 GMT -5
Not to mention these values likely include the MTM on the options he has in the company. So the board rightly ties the CEO's compensation to the performance of the company and when the company [and therefore CEO] benefit from the leadership provided then people are up in arms about CEO compensation.
Ignorance and/or stupidity sounds about right. [/size]
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formerexpat
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Post by formerexpat on Mar 25, 2011 13:01:33 GMT -5
Irrelevant statistic and unsupportable. Define average CEO. I wouldn't use average pay for a statistical analysis.
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Bluerobin
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Post by Bluerobin on Mar 25, 2011 13:02:53 GMT -5
Expat, they are benefiting unjustly and disproportionately and many are under performing.
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gooddecisions
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Post by gooddecisions on Mar 25, 2011 13:14:04 GMT -5
"You guys aren't reading it right. 13% of workers pay will be taken out to pay for premiums. She said that equals $600/month for her family, which means they currently make around $55K.
She is essentially being given a 13% paycut. Christie says she can move to a cheaper plan, but I don't know the details of what insurance options they have. If there are reasonable, cheaper plans that wouldn't cut her pay nearly so much, then this seems ok. But, why doesn't the state just take away the top tier plan completely then? " You can't jump from 13% out of their pay to a 13% paycut because that assumes they were paying nothing before. Which, I find hard to believe. Even the best state benefits, the employee still has to pay something. If you go back and read the original transcript, what is not said, is what precentage they were paying before. It's not likely a 13% paycut, it is the difference between whatever was being taken out before and the increase in monthly premiums. $600/month may very well be reasonable for an expensive full coverage plan for a family of 5. My plan costs $200/month for just one person, it does not cover everything and the co-pays on percriptions and office visits are pretty high depending on what the service is. I can't boohoo and say I have a $200 pay cut a month because I have to pay a portion of my insurance. My monthly insurance premiums have increased significantly over the past 10 years. That's just the reality we live in with the increasing cost of health care. Public workers have been living in a fantasy world funded by tax payers far too long.
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formerexpat
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Post by formerexpat on Mar 25, 2011 13:23:46 GMT -5
Unjustly and under performing in your opinion. Even determining what's disproportionate is very questionable. I don't believe they're benefiting disproportionately. Most put their money where their mouth is and tie their compensation to the value of the company since they run the company.
See Paul's example. I don't think the average worker answering phones or inputting numbers in a spreadsheet, or even those on the assembly lines can manage a Fortune 500 company. Most struggle to manage their own life and finances.
Ford CEO was paid $1.4m last year. Most his compensation was due to the performance of Ford - i.e. the 8 fold increase in the stock value because Mulally turned the company around and avoided bankruptcy. How is that unwarranted?
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