Lol....merging it in with this thread is pretty genius. The OP was started (in part) because a conservative leaning chicago law professor making ~400k complained in his blog that a 2% increase in taxes on income over 250k would cause him to make drastic cuts in lifestyle....cue sad, sad violin music
Like most working Americans [who claim to pay over 100k a year in federal taxes!], insurance, doctors’ bills, utilities, two cars, daycare, groceries, gasoline, cell phones, and cable TV (no movie channels) round out our monthly expenses. We also have someone who cuts our grass, cleans our house, and watches our new baby so we can both work outside the home. At the end of all this, we have less than a few hundred dollars per month of discretionary income [seems like awful, awful money management, i'm sure consertatives where chastising him for not making better financial decisions]. We occasionally eat out but with a baby sitter, these nights take a toll on our budget. Life in America is wonderful, but expensive.
If our taxes rise significantly, as they seem likely to, we can cut back on some things. The (legal) immigrant from Mexico who owns the lawn service we employ will suffer, as will the (legal) immigrant from Poland who cleans our house a few times a month.[give me the number to donate to your charity imo] We can cancel our cell phones and some cable channels, as well as take our daughter from her art class at the community art center, but these are only a few hundred dollars per month in total. But more importantly, what is the theory under which collecting this money in taxes and deciding in Washington how to spend it is superior to our decisions? Ask the entrepreneurs we employ and the new arrivals they employ in turn whether they prefer to work for us or get a government handout.
If these cuts don’t work, we will sell our house – into an already spiraling market of declining asset values – and our cars, assuming someone will buy them. The irony here, of course, is that the government is working to save both of these industries despite the impact that increasing taxes will have.
If you make 400k and have your taxes increased by .5% you're basically Oliver Twist, but if you make 100k and and have your income reduced 80%, suck it up dude you're rich.
Max maybe you think you're making a point with that post but I don't understand what it is. If you're laughing at that idiot, I concur, but it would seem to undermine everything you've said to this point.
Max maybe you think you're making a point with that post but I don't understand what it is. If you're laughing at that idiot, I concur,
Right....that dude was making 400k and complaining about how drastic his lifestyle changes would be if he was reduced to making a paltry ~396k.
but it would seem to undermine everything you've said to this point.
I think it reinforces it, the upper middle and above can have their income reduced by a few percent and not really notice. The UC prof can claim he isn't rich (and I may agree).....but don't don't pretend like you have to sell your house and not have cell phones because you make only 396k. This is contrasting with other conservatives who think that people whose income was reduced from 120k to 20k are idiots if they need help supporting themselves.
Serious inquiries by PM only please. I don't want to sound like a pushy butler, but I must have a way to filter out trolls from legit prospective employers. I can assure any potential clients that I am quite meek and mild mannered, the appropriate temperament for a butler.
Anyone who cares a lot about the definition of classes deserves a mention. It's an amorphous concept, there are a wide range of plausible answers, depending on context. The only political implications are to attempt to reframe who is or who isn't deserving on purely semantic grounds.
Though to the extent that we are going to attempt to agree on definitions, I think percentiles are a pretty silly way of doing it. If we were really serious about percentiles, we'd use worldwide incomes and probably end up with a majority of Americans as "rich". What matters is what peoples' perceptions are. No-one's mental image of who is "upper middle class" or "rich" is some kind of robotic definition like "the middle class is 25%ile<x<75%ile, upper middle class is defined as the top half of that distribution".
The best approach is not care so much about categorising. A family who makes 120k is a family who makes 120k. They are decidedly different from a family who makes 60k or 240k. Why do we need to shove everyone into three or four neat boxes? The only legitimate reason I can see for doing this is if you're e.g. publishing a study and need a manageable number of categories to make it understandable. For the rest of us, the only purpose is attempting to create a false impression of homogeneity among the categories for political or self-image reasons.
This might be lower than most people's threshold, but I think if you make $500K/year after taxes, you are definitely rich. That's 10K per week, or a lot of families' yearly salary each month. Obviously people lead different lifestyles with the same salary and you can go busto no matter your income, but even some rudimentary monetary management at this level of income should mean easy accumulation of assets, paying for college/professional school for kids, and comfortable retirement.
The way I think of rich is the ability to shop... oh, arbitrarily, at J.Crew and eat anywhere without worrying about the price tag or sales.
A professor making steady 500k a year on tenure: rich unless utterly ******ed with personal finances.
A minimum salary pro athlete making 500k a year but one injury away from bagging groceries: not rich, although he might act and feel like he is.
A 20 something making 250k: not rich yet. But should be in 10~20 with prudent personal finance management, even if income growth (other than investment income) is zero and we assume a relatively low 4% return. By prudent management I mean a savings rate between 30~50%. That still leaves ~80k a year to spend. Half of that to rent, 10k to food, 10k to girls (my car goes in this... I hate driving), 10k to misc entertainment, and 10k to clothes. That's pretty comfortable IMO.
A 50 year old making 250k and with less than 1 mil net worth: not rich and probably will not be but he's not going to starve any time soon. He just will have to settle on a country club and probably won't be afford a second home after he pays his medical bills that will skyrocket soon enough.