$250,000 Isn’t Rich

Barack Obama proposes higher taxes for couples making $250,000 a year. But with costs rising fast, that hardly seems “wealthy” now. Pro or con?

Pro: Obama Passes the Buck

A low six-figure income does not buy what it used to. But Democratic Presidential candidate Barack Obama has said he will cut taxes on lower-income families and make up the difference by raising taxes on households that make $250,000 or more.

Obama’s proposal suggests that double-income families are hoarding cash under mattresses in tony multi-unit McMansions, while working-class men and women are taxed into poverty. But, like everyone else, the estimated 2% of the population that makes more than $250,000 has been hit by a 6.6% increase in the cost of college tuition from last year, a 20% increase in gasoline from April, 2007, to April, 2008, and a meteoric rise in grain prices that has pushed the cost of a loaf of bread from $1.28 in January to $1.37 in April.

Consumers at all economic levels have been hit by the higher cost of living, but saddling 2% of the population with higher taxes to lessen the tax burden on the remaining 98% caters to a populist myth that national crises have an impact only on the very poor and leave everyone else unscathed.

The fact is that businesses are tightening their belts, and some higher-paid employees are having to take a pay cut or losing their jobs altogether. And the National Association of the Self-Employed reported that 86% of its members, many of whom would be forced to pay higher taxes under Senator Obama’s plan, believe the economic downturn has negatively affected them. Most have said they will not purchase new equipment or inventory this year. And as many as 40% say they expect their profits to drop for the rest of the year.

The so-called wealthy will have to stretch their dollars to keep up with the rising cost of living just like everyone else. But there is a silver lining. If their incomes continue to drop, maybe they will end up benefiting from Obama’s planned tax restructuring.

Con: Much More Than Middle Class

“Wealthy” is a relative term, and one that gets batted around for political purposes quite a lot. Its definition isn’t always clear. But if you look at the total income spread of working Americans, those making more than $250,000 are indeed wealthy—at least statistically. It’s easy to forget what the average person really makes amid big-money talk of billion-dollar writedowns and executive pay packages in the millions. But in 2006, the median household income in the U.S. amounted to just over $48,000. Even if you take out those just starting their careers and only count workers older than 25, the median household income is still about $53,000. That’s the true middle of the spectrum.

On the far end are the richest American households, or those who make more than $250,000 a year. These are America’s elite. The Mercedes-Benz-driving, Coach-bag-carrying set. Only the top 2% of households in the U.S. pull down that kind of cash.

Also, the people in this tax bracket don’t just make 250 grand and then stop. They are in the $250,000-and-up (and up and up and up) bracket. And it’s this group that has reaped most of the benefits from the Bush tax cuts.

To be sure, recent economic events have not left anyone’s wallet bursting. And rising food and fuel prices are raising everyone’s cost of living. But the top income earners in America don’t deserve much sympathy. In addition to the obvious fact that they have more money to spend than lower-income people, as a proportion of their income, the amount richer people pay for food, fuel, and education is smaller. Feeding a family of four takes the same amount of food whether you make 30 grand or 300 grand. Ditto with paying for fuel to drive said family to school and work or for a college education. Higher prices for necessities hurt the truly disadvantaged more.

Tax breaks should go to the people who are in danger of losing their homes or not being able to afford health insurance. The wealthiest 2% will find a way to scrape by.

Opinions and conclusions expressed in the BusinessWeek Debate Room do not necessarily reflect the views of BusinessWeek, BusinessWeek.com, or The McGraw-Hill Companies.

Reader Comments

Johnathan

I think that the idea of "Robin Hoodism" is insane. All classes should be taxed equally. (All men are created equal?) If everyone has to pay the same percentage across the board, there is no cause for gripe. Everyone is equal, even if you make more than the average. The key is to stop a multibillion dollar war, circle our wagons, and rebuild what we have so eloquently destroyed over the past five to ten years. There are so many ways to run our economy more efficiently, and there are so many fears about the consequence of doing so. Yes, I agree that there will be some momentary issues. Every time anyone or anything transitions from one way to the next, there is a momentary issue.

eyedoc812

Let's face it, we've got to increase taxes if we want to begin to pay off the $9.2 trillion debt (and counting) that our politicians have bequeathed to our children and grandchildren. Either that or inflate the currency to Weimar Republic levels (and most of us know what that led to). Somebody has to pay for the excesses of the last 50 years (and especially the last seven-plus years of "guns and butter"). Sure, we can start with the hedge fund guys paying 15% on their "carried interest," but that still leaves trillions to go. So step up to the plate, ladies and gentlemen, and stop your whining.

lawdog

This country absolutely needs to go to a flat tax or a consumption tax and get rid of the different tax rates. Just think of the amount of waste we spend on the IRS and state tax boards. Also very low or no taxes on dividends so that the elderly can fund their retirements and take some of the stress off of Social Security. Also, by changing the tax codes to a flat tax or a consumption tax, a person could actually get ahead in life by working two jobs or pursuing overtime. The way things are now, Obama wants to kill the middle class by taxing them to death so he can give more social programs to the poor and non-contributors in society. $250,000 for two working adults combined salary sure the heck isn't the rich class, considering you must pay your own health care, fund your own retirement, pay for your own college, and buy your own home. Obama needs to get a clue on taxes or he will alienate many of his voters.

charles

One quarter million equals "wealthy"? Nowadays? Somebody needs to get a life and come back down to reality.

I personally make way less than that per year. And I can just imagine most people making $250,000 a year are at least beginning to worry about how they are doing expense-wise. I mean, let's face it, $250,000 doesn't buy much any more, like it used to.

Now maybe, just maybe, if they would have bumped that up, like say, past the million mark, then I'd probably start agreeing. But $250,000? Yeah, right, that's still the middle class area.

P.S. Someone said that wealth is subjective. I agree. Wealthy equals nothing less than $10 million.

solong

Lawdog, I, too, had to pay for two children to graduate from college, pay for my own health care for my family, and fund my own retirement. This was done on less than one third of the $250,000 mark. Sorry, I cannot feel too bad for those in the quarter-million income bracket.

REM

If you can show me a "poor person" in the lower income bracket who can create a job for someone else, then I say, yes, tax those so-called rich folks. Once you reach a certain level of income, the thinking is to do better. Become an entrepreneur, start a business, hire someone to help. Are we trying to kill the middle class? Of course, then we will see the jobs disappear as the creators disappear. Wise up, America.

Dave

I think a consumption tax on luxury items would be right on the money. People in the $250,000 and up bracket would pay for most of this. If people don't think $250,000 is a lot of money, then what the heck is $53,000? It is only 21% of $250,000. Live on that for awhile, and please don't complain about poor me on only $250,000 or up. I don't believe in the trickle-down theory. It certainly is not working now, is it? How about the trickle up theory? If the ones that make less than $250,000 can afford things again and not cut back on spending as much, guess what? The money will flow up. The paradigm must change if the economy is to grow. You $250,000 and up people just are not spending enough money to make the economy grow. After all, you are only 2% of us. Let the rest have more of the money and you will see the growth.

Jon Kelly

Here is an idea: Let's cut spending. Then we don't have to raise anyone's taxes. I think all tax levels deserve tax cuts. We have a myriad of federal and state programs that are practically a joke and do not make serious efforts toward their intended purpose. I think the idea of Obama running on a platform of raising taxes on the rich is going to seriously hurt him in the general election. I don't think there is anyone in this country who believes all of our tax dollars are well spent. Let's start with reforming the programs we having and cutting taxes.

Skooby

How will Obama's tax plan affect people making, say, $30,000 to $50,000? I read somewhere that for anyone who makes more than $30,000, taxes would rise. Is this true?

Ben

A couple making $125,000 each and living in a high cost city is not "rich." Anyway, if someone is working two jobs and trying to earn more is taxed at a heavier rate, then guess what that person is going to say--hell with it, why should I work the weekend so I can provide a tax cut for my lazy neighbor? Once the incentive to make money is not there, it kills innovation; it kills the economy. If it was so easy to grow the economy by increasing taxes on those who are "rich," then Cuba and all the other socialistic countries would have been what the U.S. is today. I immigrated from Australia to run away from the high taxes there. Similarly, increased taxes will mean people use more tax shelters or they just don't want to put in that much extra effort, and the economy suffers.

Everyone is talking about the $250,000 bracket. Why is no one talking about the payroll taxes that Obama will raise on those who make more than $94,000 to plug the "hole" in the Social Security fund. Is someone drawing more than $94,000 "rich" too?

Patrick

There must be a reason someone makes $250,000 or more. Either higher education or hard work. I don't think it is right to put higher taxes on people who make that kind of money. What I am trying to say is that it is not a rich person's fault if someone doesn't work or doesn't know how to spend money.

I would suggest that the U.S. cut back its expenses for unnecessary wars and spend the money where it is really needed and not punish hard-working people who often dedicate their whole lives to their jobs. I think it is just more than fair that these people make more money.

Joseph

Why do Democrats always propose raising taxes? It's their classic knee jerk response to every single issue. How about cutting spending? How about eliminating waste? How about going back to low taxes and limited government the way the Founding Fathers intended? How about giving people more control over their destiny by allowing them to make their own economic decisions? I'm sure comrade Obama would find these ideas to be dangerous and radical to his way of thinking.

ETB

Dave: "Let the rest of us have the money and you will see growth again." Let you have it? Go earn it, and you can do whatever you want with your money. No one at $250,000 and up is asking folks to feel sorry for them, but if they earned that money, they are already paying way more in taxes than the median household income. I think the only request is to not tax them any more. You can think whatever you want of them. Better yet, invest in yourself, work hard, and join the folks who make that kind of cash. We live in the only self-limiting society in the world.

logic

$250,000 in income is rich. I live in San Francisco and make roughly half that, and am doing very well. I can pay more if needed. In most parts of the country, $250,000 is insanely above average.

HAhmad

The fact is, costs are rising and wealthier people will be in a better position to weather the storm of paying higher prices. The tax burden should fall on those who have the money to cope with taxes and increased prices. Lower income families will have a hard time paying their bills, let alone worry about paying higher taxes. If you can drive a Mercedes-Benz, you should pay higher taxes and take comfort in the knowledge that you're doing greater good by funding public services for the impoverished who need it. Americans should view this policy as a solution to the great divide between the rich and poor in the country.

BellyLaugh

Are you kidding? If you don't have a million or more, you're not even close to rich, laugh out loud.

Bob

I would just like to point out that currently, the taxes are relatively proportionate: The top 1% have 30% to 35% of the wealth in America and pay about 30% of all total taxes. Ditto for the top 20%--80% of the wealth and 80% of the taxes, so if you're going for fairness, it's pretty much okay as it stands. Granted, living expenses are a much smaller portion of income for wealthy people, but it's not like most of them haven't earned their high incomes and used them to provide jobs and livelihoods for others.

Raj

While I support Obama, this bit of logic baffles me. It sounds like steal from the rich and give to the poor. It also implicitly hints that the "rich" hoard the money. Au contraire--a higher spending capability makes it way back into the market via investments in the stock market, seed money for new ventures, ability to employ more workers for tasks around your place of residence, and in general the ability to stoke good ol' U.S. capitalism. Leaving less money for these "rich" to spend affects the ability to reinvigorate the recessionary economy that's plaguing us.

We need more "rich" people to help provide opportunities to the low income workers. The hope is that eventually these low income workers will work themselves to the rich bracket themselves. But in order to do so, we have to guarantee rewards through hard work, not through handouts.

Ralph

We don't make $250K, but we're close. We don't think we're rich by any means for the area where we live. Nor do we think we are poor. If we made this income in another part of the country where the average income (and cost of living) is lower, then yes, we would be wealthy. I agree with other posters that there should be a flat tax, where everyone pays the same tax on their dollar. I don't mind paying my share of taxes, but when people who make real money pay a lower percentage than people who make less, that's not fair. One example: Why should my income have a cap on what I pay for Social Security? How is it fair that I pay a smaller percentage of my total income than someone who earns who earns less than the Social Security cap?

Jelly

$250,000 per year may not equal "rich," but it is certainly well above the average middle class income. No one likes more taxes, but we've got to get out national debt under control. That means companies and individuals will need to contribute more. The math isn't hard; it's just not pleasant.

Lori

Me and my money, me and my money, me and my money. That is all the conservatives think of and care about. Yes, anyone earning $250,000 is rich. If they can't afford to live somewhere on $250,000, then they need to move to a place they can afford. And $53,000 may be the median income, but that still overstates what people are making. According to the Bureau of Labor Statistics, the average American earns $38,729 per year. If you can afford to pay in taxes the same amount the average person in America earns per year, you are rich. I am so tired of hearing these people complain about taxes. These are the people who want something for nothing. They want to get rich from the benefits of living in a civilized society, with government constructed roads and bridges and power infrastructure, stay healthy with a government subsidized pharmaceutical industry, and fill up their Mercedes and Porsches with gas from the government subsidized robber barons of the energy industry. You should all be ashamed of yourselves. Do you realize that the average person who works a minimum wage job has to work 11 hours just to fill up their gas tank these days? There are people quitting their jobs because they can't afford to put gas in their car and aren't able to use public transportation to get to work. If you expect me to have any pity on you because you earn $95,000 and may have to fork over some more money for Social Security taxes, you are sorely mistaken. You people are ridiculous. You should stop your whining and thank God for the blessings you have and the fact that you can afford to pay your electric bill, fill your gas tank, send your kids to college, and put food on your tables. You should be grateful that you are not one of the one million people facing home foreclosure. I just can't take you people any more. You are what is wrong with America. Me and my money, me and my money, me and my money. You are like children.

Rich Fletcher

Lori, maybe that's because we earned it, and the people who choose not to earn it like you, want to take it away through government programs and taxes. The richest 1% pay 50% of all taxes. When are leeches like you going to realize that the danger in America isn't conservatives; it's morons that want to keep fattening the pockets of government programs and their stupid unskilled employees. Government isn't going to help you; only you can help yourselves; We pay enough taxes, and don't need to be lectured by a college student working part-time at TJ Maxx and probably have yet to travel abroad. Just wait and see.

Scott

I think a large portion of the $250,000 question is based on where you live: $250,000 in New York is not $250,000 in Atlanta. But if you take average America, $250,000 is a lot of money. I don't make near $250,000, but I'm far from poor. If you make $250,000 and are being taxed into poverty, you are not good with money and may need a financial expert.

Evander Holyfield says $200 million is not as much as you think it is.

Jeff Johnson

Rich Fletcher just nailed it.

I would like to suggest that poor Lori move to Sweden. They pay 60% or 70% in taxes, but then that would mean Lori and all those hard working couch potatoes like her would have to take an initiative to do something. Oh well, stay here and complain that C's and D's in school did not get you into a decent college.

TLeung

What about tax those hedge fund managers who earn more than a billion in 2007? What are they going to do with so much money, buy toilet paper made of gold?

lawstud

There is a reason there are more than 150,000 overseas accounts from New York City residents to avoid income tax--mostly belonging to people who do not have a salary but are professionals, accountants, doctors, lawyers, etc. Increased taxes mean more of these people will escape income tax.

Frank

I do not make $250,000 a year--I make about $100,000 less then that and live in a fairly pricey area of Northern Virginia with three kids and a stay at home wife.

I feel that $250,000 is wealthy. If I made $100,000 more per year, I would feel wealthy. Why? Because at $150,000 year, I live like I make $150,000, not like I make $250,000. We have two vehicles and a, relatively speaking, small house. I do not live in a McMansion, and I do not drive two BMWs. The problem is too many people at any salary level live like they make way more then they do and have been living this way for too long, so they end up with ridiculous monthly payments on things they should never have bought in the first place.

Sure am I going to outrage some, but the truth hurts. Being wealthy does not in my opinion mean you can have anything you want. It means you should have enough to live on and save for retirement and college if you can control the "I want it now impulses."

Food

Everyone can get a tax break if we stop the $100 billion for six months of expenses for war.

More tax breaks will keep more wealth in the country, or else rich people will hide their money in Swiss banks or invest it somewhere else where they get tax breaks.

We need someone on the conservative side to stop the war.

Brian Wang

The point is not whether it is or is not right to tax the rich. The point is that raising taxes will not work. Raising income taxes does not collect more money. Even when marginal tax rates were higher decades ago, the government was able to collect about 19% of GDP. The best private accountants and lawyers are just smarter and more motivated than those who are writing the tax code. Those writing and enforcing the tax code are not all working together for the sole purpose of increasing the government take.

The really rich can morph their financial profile. They can take money as dividends, short or long capital gains, personal income tax, corporate income, or just use expenses against income, etc. Make it too hard for them, and many can just decide to spend six months plus one day somewhere else. Buy another citizenship and renounce this one.

Those in the $250,000 to $400,000 a year range from two working people are more vulnerable than those who are richer. They may be tied to jobs here and have less financial flexibility. Over time if they still manage to get richer, then they can adapt. They may also make choices over years to get to a tax-friendlier situation.

David

I'm fine with people making tons of money. It's America, you make lots, good you deserve it. I don't feel like I should be given a handout. I work hard for my money, but make nowhere near $250,000. My biggest problem is the Social Security cap. Why should I pay 6% to 7% of my salary to Social Security while someone else who makes more pays 1% to 2%? Especially when I doubt I'll even be able to reap the benefits of the horribly managed Social Security system by the time I reach retirement age in 40 to 50 years.

Andres Ramirez

Obama is out of touch with reality. A large percentage of people making more than $250,000 with dual incomes also have hundreds of thousands of dollars in debt (law school, medical school, business loans, etc.)

If you want to start taxing the "rich," start at at $1 million dollars of income. These starting upper middle class people are the backbone of the economy, the ones creating jobs in the small business community, the doctors, the lawyers. If they get taxed to death, who will be creating the jobs across America when Corporate America scales down its operations?

falstaffal

If anything, there should be more tax brackets and the rates should reach up to confiscatory levels.

Simply put, those in the top bracket are high earners only because of the American economic system we have in place. They have gained the most, and they have the most to lose if the American system collapses (if you have nothing, or little, you cannot lose much). Really, 33% for income more than $250,000 is a steal (for the wealthy). I, for one, would welcome the reintroduction of the 91% rate for incomes of $1 million and up.

kater

If we are to keep the tiered tax structure, I think we might consider a cost-of-living formula. Various organizations already provide cost-of-living indexes that could be used to reduce tax rates in places where $30,000 and $300,000 don't go as far. In the San Francisco Bay Area, $300,000 is definitely middle class. Imagine how the person making $30,000 or less feels. Now imagine how well someone making those salaries would do in an area with a lower cost of living. The $30,000 a year worker would be in the middle class, and the $300,000 a year worker would certainly be closer to wealthy.

The article talked about how the cost of basic necessities is the same for a family of four no matter how much they make. But they're not the same no matter where they live. This is the fundamental issue in my mind.

random

"Obama's proposal suggests that double-income families are hoarding cash under mattresses in tony multi-unit McMansions, while working-class men and women are taxed into poverty."

Actually, no. This is what Mr. Winfield is suggesting because he's in need of two things in his argument. A straw man and a bogeyman. The bogeyman is Obama, and the straw man is the ridiculous attribution of these ideas to a candidate who never said anything of the sort. It might be interesting to note that Obama would also be affected by this tax hike as well as all Democratic lawmakers since they all make more than $250,000 per year when their pay is combined with their investment gains and other revenue sources.

"The fact is that businesses are tightening their belts, and some higher-paid employees are having to take a pay cut or losing their jobs altogether....If their incomes continue to drop, maybe they will end up benefiting from Obama's planned tax restructuring."

If this is the case, then by Chuthulu's unwashed jock strap, this economic downturn is not even a recession but a Great Depression style wipe out as the top 2% of earners see 80% of their incomes evaporate.

"How about going back to low taxes and limited government the way the Founding Fathers intended?"

Politicians need the government to be big, because public service is now a career, not a volunteer job as it used to be. Our lawmakers need size and power to exercise their will and become ever bigger targets for K Street. The moment politicians let go of scale and mind-blowing numbers, their importance, power, and pay decreases. Hence, there's no way they'll start making the government smaller.

Democrats aren't the only ones expanding the government. Republicans do the same thing, albeit via doublespeak and turning to private contractors who act as arms of the White House after being given no-bid sweetheart deals.

"...maybe that's because we earned it, and the people who choose not to earn it like you..."

So wait a second, you can choose to make $250,000 a year? Then why did 98% of the nation make a choice not to? One would think we would all want to have plenty of money in our pockets. Do 98% of workers lack the skills, intelligence, and dedication to make a high salary? I'm a college grad, work two jobs, and am in the top 25% or so. But I'm nowhere near $250,000. Help me out here. What am I missing? Or could it be that there's not enough room for more than 2% of the population in occupations and ventures that bring in such incomes?

I'm not even talking about those who make far in excess of $250,000 who are also part of the hike.

"The richest 1% pay 50% of all taxes."

Since when? According to the IRS, they pay about 21% of all taxes. Just because Rush Limbaugh said it, doesn't make it true. In fact, if he said it, assume that he's making it up unless proven otherwise.

If you bring 100 people to a room, and 2 of them have an annual income that's at least:

25 times greater than 14 of the occupants
8 times greater than 37 of the occupants
4 to 5 times greater than 47 of the occupants

And overall they make at least as much or far more than all of the other room occupants combined, what would you call them? Poor? Average middle class? I'm going to go with wealthy.

We shouldn't get fixated on that $250,000 when there are also millionaires and billionaires in the mix.

Kartik

Taxes should be on consumption, not income. Thus, people have some control over how much they pay, and on tweaking their taxes during lean times.

On whether $250,000 is rich or not, it depends. A single 28-year-old Wall Streeter earning $250,000 is rich, as his disposable income is high. A 55-year-old middle manager, with three kids in college and an elderly mother to take care of, earning $250,000, is not rich, as most of his spending is not optional.

Kartik

The reason this discussion is so unintelligent is that everyone who talks about the national debt and deficit talks about increasing tax revenue, but they don't talk about gasp reducing spending. Tax revenues are not low. Tax increases are not needed. Spending cuts are needed. Until enough people face that reality, the problem will never be solved.

Kartik

Oddly, it is conservatives who voluntarily donate money to charitable causes, while leftists are the ones who do not. Leftists love to take other people's money away (due to jealousy), but don't want to make any sacrifices themselves. Only a leftist who is volunteering his/her/its time at a soup kitchen, orphanage, etc., has the moral authority to lecture anyone else about sacrificing for the greater good. Selfish, jealous, lazy leftists are the core of the problem.

Kartik

Tax revenues are 30% more than they were in 2000. Clearly, Bush's tax cuts increased revenue.

However, spending rose even faster. Thus, the answer is to cut spending and force lazy left-wingers to work.

Let Obama raise the tax rate on the $250,000-plus earners. Let a lot of us leave and move to Dubai, Hong Kong, Ireland, etc. (tax rates in the teens). Then, let's see how well the U.S. economy functions without anyone driving the bus.

Tax cuts always work. JFK and Clinton cut taxes, too, and the economy benefited. Obama is the personification of how the left destroyed the Democratic party.

Kartik

All the jealous, lazy leftists who want taxes to be higher are full of it. They talk about debt for their "children and grandchildren," except that leftists don't have children--they abort them. No wonder the Democratic party is repelling people of high and even average IQ. The comments here show that.

Kartik

Official breakdown :

The top 1% pay 38% of all taxes.
The top 10% pay 74% of all taxes.
The top 50% pay 97% of all taxes.
The bottom 50% thus pay just 3% of all taxes.

All the more reason that a consumption tax would be fairer than an income tax.

R. Washington

If you make $250,000 and above, your quality of life depends on what part of the country you're located in. If you're living up north, that same salary is not going to stretch as far, as opposed to living down south.

Even so, I do understand that until the country as a whole prospers, the income gap will continue to cause some of the problems consistent with lower income areas. Think about it this way: What good is it if you're doing well and making $250,000 a year and those outside of your community are suffering? We have to leave our gated neighborhoods sometime. Ultimately if higher taxes produce lower crime, better education for everyone, health care etc., I'm OK with it. Anything else is selfish.

Adil

Falstaffal:
If you tax people making $1 million and above at a 91% tax rate, you are basically making the poor people even worse off.

This will occur because current millionaires will lose the incentive to earn at that level because they will not retain any of that money anyway. If the millionaires have no incentive to earn a lot, they will stop making so much money.

Without millionaires earning a lot of money, there will be nothing to tax. So poor people who basically live off of taxes will be even worse off.
QED

random

"Oddly, it is conservatives who voluntarily donate money to charitable causes, while leftists are the ones who do not."

And your stat on this comes from? Was there a study? Some sort of poll? Without any factual backing, your entire argument is just shrill, baseless partisan hysterics.

David

Wealth is determined by what you have saved--not by what you earn. Many people spend everything they earn, and these people will never be wealthy. The couple you have used in this debate are not wealthy--they spend everything they earn. I have little sympathy for someone who earns a high income, spends it all, and then complains about how a possible coming tax hike will force them to reduce their lifestyle. I fully agree with those who suggest these high-income earners move to a less-expensive state. If more people did this, the high-spending Democrat socialists of California and the Northeast would have to spend more prudently.

Ron

People are suggesting that we should tax the higher-income individuals more because they earn more. But come on people, why are these so-called higher-income individuals penalized for working harder and making more money? As a result, this country's competitiveness and productivity will go down. This is just simple economics. My wife and I actually make slightly more than $250,000 a year and we work our butts off. Should we be penalized because we work harder than most people? People complain that they are "disadvantaged." But did you work hard enough to get your education in the first place? Just think about that before you start whining. I will not vote for any politicians who would penalize a small group of hard-working people just to please another group of people for their ballot votes.

Squeezebox

The unemployment rate in this country is more than 5%. That's one in every 20 people. They can't all be lazy and shiftless. Folks don't earn what their talents are worth; otherwise policemen, firemen, and soldiers would be millionaires. Face it, having a combined income of $250,000 or more, regardless of where you live, is a gift from God. It says in the Bible that if you are given much, then much is expected. That means charity for the poor people, but if you're too selfish to give your money away, you need to be taxed. The Bible also says that money is the root of all evil.

Sissy

Kartik, where do you get the idea that only conservatives donate to charity? Americans of all political persuasions donate money and time to charitable causes. In fact, the U.S. government recently reported, "65% of U.S. households with incomes of $100,000 or less make charitable contributions." I and my family are all proudly left of liberal and still manage to donate time and money to a variety of causes, including educational, cultural, and humanitarian relief projects. I have a dear friend who happily describes himself as "left of Trotsky" who nonetheless manages to volunteer four to five days a month with Habitat for Humanity, building homes.

I love how conservatives are willing to claim "it's my money" but not "it's my debt." Your boys Bush and Cheney ran up the debt, just like Reagan and Bush. Then the Democrats have to come in and clean up the mess, paying for Republican misadventures. Get a grip.

Jay

I live in San Francisco, one of the most expensive cities in the world. Yes, I choose to live here and I am compensated for it. However, my cost of living adjusted for my salary does not make me rich. It makes me spend a lot for what other people consider basics, $4,000 mortgage and property tax for a 1,300 foot apartment, $5 loaves of bread, $4.50 gallon of gas, and $12,000 for my child's day care. God forbid I tried to take advantage of a school system, which my property taxes pay for, where 80% of the student body requires English as a second language course. My only savings is my 401K. If my taxes are raised, I won't have anything left. I don't live large; I work hard. With higher taxes, I would have to move. Not fair. Not fair at all.

Lord

As long as those in favor of cuts identify them and persuade others to join them, I have no objection. Meaningless talk about unidentified cuts is pointless. If they are incapable of doing so, then we should talk of tax increases. Cutting war spending would be top on my list, but I realize, even ending the war, there will be continuing expenses for years. Tax-wise, there should be an exemption level and logarithmically flat taxes on the excess since that is how income is distributed. One shouldn't confuse income with wealth.

Nick

Of course, a $250,000 income is rich. The reason this country's economy is in the toilet is because the "pundits" continue to talk as if you must make a million a year to be rich. Our entire economy is supported by credit, hence the high prices and high wages. Without credit, it will be a different story.

Scott

The only thing with the incomes mentioned in this article is that people on the threshold won't be severely affected. They will get a slight hit, but the ones paying a lot more are the ones who can afford it. On $300,000, assuming the full amount is taxed, that results in $4,000 in additional tax ($85,000 before vs. $89,000 after), or 1.3% more tax. Not great, but certainly manageable. I agree, taxing consumption would probably be a fairer way, but we're a long way from that happening, if ever. Plus, I think there are a lot more concerns with it than have been addressed so far (but that's not the topic here).

RICH

I make around $180,000 per year depending on the economy. I am in sales and work 80-plus hours a week on a regular basis. My wife also works and makes around $40,000 doing accounting. We have invested in rental properties over the years and invested in stocks. With three teenagers at home and the costs of tuition, health care, gas, and food rising rapidly, I would agree that $250,000 is in no way "wealthy." While I understand it's harder to do on $100,000 or $50,000, I shouldn't be punished for working hard and getting ahead. We need to scrap the IRS and come up with a better system.

zohan

Yes, anyone making $250,000 is rich compared to average income holders in the USA. Besides that, heavily tax the millionaires. Make universal health care. Bring in more and more doctors. There are so many bright, talented doctors all over the world. Bring them like we bought IT consultants. Create more and more jobs. Let everyone peacefully.

vik

1. Let's take person A and person B. Both go to school. A is cool going, passed all his exams, went to state college, got a degree, and comes out with after four years with $50,000 in loans. Person B passes all exams, works harder, scores higher SAT, goes to a elite school, after four years comes out with a $100,000 loan, goes to school again, finishes medical or MBA schooling, comes out after five years with another $100,000 loan. There would be and should be a higher pay for person B with higher skills. Eventually after six to ten years of hard work, spending two to four more hours at work after the rest of the people go home, person B is penalized for earning $250,000 or more by increasing taxes. What is the logic here? Just because government is spending money on an unnecessary war.
2. How far does $250,000 go in Manhattan or LA? Not so far.
3. How far does $250,000 go for caring for kids and wishing to provide for their education? Not so far.

Why is the burden on hard working folks? Just because there is a $9 trillion-plus loan. This loan was not merely used for folks who earn the specified amount; it was used for all in the USA. So the burden should be on all.

ETB

Who are all of these people who think that the "rich" are just winners in the lottery of economic gain? Doesn't occur to any of these socialists know that people who earn $250K or more have done something of value to earn it? Trust me, no one is on the street handing out $250K comp plans. They are earned in competitive industries with razor-sharp skills--skills that are learned through hard work and smart decisions. Wake up, America. This is what makes us great.

random

"Tax revenues are 30% more than they were in 2000. Clearly, Bush's tax cuts increased revenue. However, spending rose even faster. Thus, the answer is to cut spending and force lazy left-wingers to work."

Kartik, people like you scare me. Why? Because you make absolutely zero attempt at a logical train of thought in between quoting fallacious, rage-filled talking points.

If tax revenue rose and so did spending, what the hell does it have to do with the left? Spending rose in the economy, because people bought a lot of homes and plowed a lot of money into them, and in the government it rose because of war.

If 95% of the nation is employed, it means that 95% of the "lazy left-wingers" are working. That's why spending rose. Jobs came back as the economy got over the dot-com boom and focused on housing. Tax cuts just served to promote investment. So now, when people over-invested in housing and lived on credit for a decade, how the hell are you going to put "lazy left-wingers to work" if they're already working for a long, long time, and what the hell do they have to do with this?

If you're just going to get your fix of screaming your head off about people who think differently, please warn me so I don't try to find any actual thought in your ravings.

Jason

I make $250K-plus annually. But I live in Silicon Valley, so I can't even buy a home without stretching my budget. (Actually, I rent because I don't want spend 50% or more of my take-home pay on housing expenses).

My tax bill is quite high, because I do not have my mortgage deductions. I never reaped the Bush tax cut benefit because AMT ate them all up, literally.

My pay may seem high at first, but middle-class living expenses (mostly housing) in the area are even higher. Someone who has a $160K income somewhere in the Midwest may enjoy a higher standard of living than mine.

Sure, I'm not poor. But, I'm not "rich" in any traditional sense (being able to afford luxurious lifestyles). I'm just another working stiff who is trying to make a living, but a dream of the middle-class lifestyle (especially homeownership) is still elusive, even to me.

ETB

A very bright teacher of mine told me many years ago that if you took all the money in the country and divided it evenly among the population, in 10 years 95% of the people who have the money today would have it all back. Income and wealth, in most cases, is earned through hard work, smart decisions, and excellent performance. Not a very hard equation really.

Aaron

I'm confused at how $250,000 is not rich. I know that the people in this article think that they would be stretched, but that's because they are spending a whole lot more than they need to on some things. Here's an example:

$250,000 is a little more than $20,00 per month. Let's say you live someplace that you have to spend $700,000 for a house, like California or New York, now you could spend much more for a larger nicer house, but even in California or New York, you should be able to find something decent in that range. Your house payment is around $5,000 plus taxes and insurance, so you can call it at around $6,000 a month, leaving "only" $14,000 to live on. I'm sorry, but even if you were paying $9,000 in taxes (45%), that would leave you $5,000 a month for everything else. I think that anyone can live on that, and if you can't, that means you have cars that cost too much, take vacations that cost too much, and could buy food that costs less (bargain brand stuff tastes remarkably similar and will get you through this tough time). As for paying for your kids college? That would be nice if you can pay for some of it, but not surprisingly, thousands of people pay their own way, and if you can only cover part of it, I think they will forgive you, unless of course you've raised your children to expect everything handed to them. Sorry, I don't feel too bad for you.

We all pay too much for health care, and something needs to be done. Gas prices are hurting us all, but as a percentage of income, spending on gas hurts those who make $50,000 a lot more. We are idiots for creating an infrastructure and a culture dependent on personal transportation in the first place, and now we suffer for it, and we will for another 50 years until we can either create cheap renewable energy and have nontoxic energy storage (batteries that don't pollute terribly) or not rely on personal transport.

Steve

First, I don't agree that we need to increase taxes on any class. In 2006, U.S. federal tax revenue was $2.4 trillion. It seems to me, we end the "war" in Iraq, stop the $10 billion a month drain and we'll be fine. For $10 billion a month, I am betting we could already have a hydrogen fuel supply network up and running, and end our counterproductive relationship with the Middle East once and for all.

Second, most of those who make more than $250,000, did so by working long hours, driving new business. They are probably responsible for bringing in money that funds more than half of the paychecks of those making the median income. Tax those people, and economics shows their incentive to put those hours in lessens. It's called the law of diminishing returns; they will take a hit sure, but it will be those making ~$50,000 that will take it the hardest.

wongper

We all know the Communist system won't work. The graduated tax is like the Communist system, destroying the motivation of taking risk, hard work, saving, and investment. I grew up in Hong Kong, which is a flat-tax system. The more you earned, the more you keep after paying the flat tax. My husband and I made more than $200,000 a year, but you know what? We spend our money very carefully, no flat-screen TV, no European vacation, no gadgets. We save a lot in order to be financially secure, in order to support our kids through college and medical school. If you know me, you may pity me for my lifestyle. I really don't think I am "wealthy" at all.

ffk

I am already looking forward to going part time if tax rates are significantly increased. The politicians can tax my money but not my time.

If you are in the top 1-2 percent of income earners, Obama obviously thinks your money isn't yours but belongs to the poor masses. Money isn't yours. All money belongs to the government.

Can anyone out there explain the difference between Mafia extortion pay-offs and taxes? You get protection from some bad Mafia dudes or the IRS agents.

Bill

An article on Money.com a few months ago stated nearly 50 million American households do not pay federal income tax. Mr. Obama, Ms. Pelosi, and Mr. Reid plan to increase this number by giving citizenship to millions of illegal immigrants and by lowering taxes on senior citizens. Apparently, "freedom" really is free if you underachieve.

Want to be President? No relevant experience is necessary--just promise to tax the "rich" and promise more to the underachieving 50 million working families who do the right things, like underachieving.

Taxation is no longer about fairness. It is about entitlement. Not the entitlement of financial prosperity for those who overachieve but the entitlement of those who underachieve.

Which is worse--greed or envy?

Lori

For your information, I am a hard-working person. I busted my butt and put myself through a very expensive college and graduate school. I did it with financial aid and student loans, which I did pay off. I lost both my parents by age 14, so I didn't have Mommy and Daddy to pay for it and for any incidental expenses. So don't you tell me that I didn't earn what I have now. There have been times when I have worked three jobs at one time to be able to pay my bills. Fortunately, now I make a very good salary. I am not rich by anyone's standards, but I am comfortable. I give a substantial amount of money to charity, because I feel that those who have should give back to the society that helped them get where they are. I never forget where I came from and how lucky I feel to be where I am today.

The fact is the rich wouldn't be where they are if their businesses couldn't use the infrastructure built by government tax dollars. Many of your children would not be educated without the schools built by government tax dollars. Many of your family members may not be alive, but for the government tax dollars that fund research for medicines and medical procedures to save lives. Government tax dollars make sure the water you drink isn't going to make you sick. Government tax dollars make sure that if your home is on fire, the fire department will be there to put it out. Government tax dollars make sure that if a crime is committed against you, that the police will show up to help. Government tax dollars make sure that the meat you eat isn't teeming with E-coli.

Our country is falling apart because we have mortgaged our economy because conservatives have turned taxes and government into the evils of society. Our bridges are falling apart and our power grid is on the verge of collapse. But God forbid we raise taxes. The money has to be spent, whether you like it or not.

What I resent is you leaving the tab for your children and grandchildren to pay. I resent that you are willing to allow your country to fall apart just as long as it doesn't hurt your bank account. You are selfish.

zak822

What a thread! Ask the multitude making $35,000 if $250,000 is rich. You guys spend a lot of time arguing away from the point. The "rich" will force Congress to provide loopholes for them even if we have a flat tax. The problem isn't tax rates, it's that Congress provides tax loopholes in return for campaign cash and future jobs when congresscritters leave office. And it will continue to do so.

RMILL

First of all, 2/3 of the world's population lives on less than $2 a day, so we're all rich. Second, nobody actually pays 30-something percent of their adjusted gross income. In the top 1% of taxpayers, I only owe about 20% of my AGI. When I drive through a fast food restaurant, after Social Security is considered, there is a good chance the guy handing me the burger is paying a higher rate than I am. Does anyone out there really think that I'm the one who should complain?

RMILL

First of all, two thirds of the world's population lives on less than $2 a day, so we're all rich. Second, nobody actually pays 30-something percent on their adjusted gross income. In the top 1% of taxpayers, I only owe about 20% of my AGI. When I drive through a fast food restaurant, after Social Security is considered, there is a good chance the guy handing me the burger is paying a higher rate than I am. Does anyone out there really think that I'm the one who should complain?

Pierre

A flat rate would mean a relatively heavy burden for people making a median income. It does not make sense to talk about household income. Only income after tax (net disposable) is relevant. Here in Europe you would pay around 50% tax on an income of $250,000, while an income of $60,000 would pay around 30% tax. What would be $250,000 after tax in the U.S.?

ETB

These socialist examples would be hilarious if people weren't serious about them. If I am making $250K or a little more, I understand I have to pay taxes, and believe me, I am paying tens of thousands in taxes. However, I earned this money, and if I do or do not go to Europe for a vacation or buy a Chevy or a BMW, that is my choice. It is what this country is all about. Who are all these omniscient "planners" who know how much I can or should spend on something? That is my choice, not theirs. I am not telling them how to spend their money, so why do they get to tell me how to spend mine because I earn more? By the way, add three daughters to the mix and see if $250K is still rich. I've got news; it ain't.

Taxed Enough

These rotten filthy politicians are nothing but socialist. They steal and spend like it was their own. I don't remember any of these rats producing anything. Obama needs to put his money where his mouth is and write a check for half of his income to the fed. Oh--he has to raise yours taxes first.

Ben Richards

Well you've got to draw the line somewhere on this. I guess earnings that are five times the national average is as good a place as any to start. Yes, if you earn $250k, you may not be able to afford a summer house. Your kids may have to go to a state college instead of Wharton or Princeton. At least your tax dollars will probably go to help support those institutions. Yes, you'll help pay for universal health care. At least you'll avoid paying for catastrophic illness treatment in underfunded hospitals. You'll help to fund college scholarships and some measure of free higher education, but the kids who graduate won't be robbing your house or raping your wife. You see, the unwealthy majority of people are finally waking up to the fact that for the wealthy, money reaches a critical mass that generates additional wealth without work. Capital gains, phony write-offs, and all the rest of the corporate corruption that goes on in this country has finally jolted people out of their usual TV-induced sleep. If I were you, I'd pay those taxes quietly without a fuss. The most dangerous man is the one with nothing to lose. If things keep going in the current direction with people unable to afford to get to work and being thrown out of their homes, we just might see the kind of revolution we associate with Third World countries. An no, I'm not disgruntled or unhappy with my own life or earnings. Hell, I made well over $100K last year. I'd be happy to pay Social Security taxes on every dime. But a world without compassion for those less fortunate and lacking the political will to change it is not the one I want my kids and grandkids to grow up in. As a recipient of very good fortune, I'm now looking at the direction the rest of the world is headed. If we don't help those who have nothing, what kind of world will they grow up to inherit?

Frank

Why isn't there a cost of living deflator in the tax code? You can only live "comfortable" making $250K while living in Manhattan, while you can live like a king in Alabama.

Erik

RMILL,
No one is paying 30-something percent of their AGI? You want to bet on that?

Many of the people in Obama's gun sites pay that much. They are married working professionals, often saddled with huge amounts of college loans, who make much money to qualify for the majority of the available deductions and too little to build up other sources of income.

Every year, my wife and I wonder why we went through years of school, deep into debt, and now work long hours so that a third of our income can be swept away by the government every year. Obama wants to destroy the professional class. The elite will remain, as they can shield themselves. The poor will remain poor, as no amount of government handouts will really change their position. But the middle class will grow, as all the professionals who have risen out of it come crashing back down.

Obama wants to destroy the American dream. He wants to strip us of our competitiveness when we need it most. He wants to ensure our innovation stops, as the rewards of entering the professional class are stripped away while the barriers remain. Success is to be punished. Hard work is to be punished. Being a victim of your own laziness is to be rewarded. Being born rich with your money in protected places is to be rewarded.

cmgrigg

Funny how a "nation built on Christ's ethics" does not believe that a $250,000 salary is sufficient to survive. Americans had better pray that God is Hindu. Jesus will not find this abuse of his life/death so amusing. That is if we really believe in him, which no one obviously does, especially Christians.

Cully

We live in San Francisco, and to own your home (not huge by American standards, two bedrooms), have two cars (one hybrid), and make payments on college loans, you need to make $250,000 to make it. In fact, we need a new roof on this nearly 100-year-old house. You should see what we pay at the pump, and in the grocery stores. I guess if we just packed it up and moved to Montana, we could live off that $40,000 a year. Not here.

Yes, yes, sad for us poor yuppies, right? But why not recognize the radical differences in the cost of living? Should we all abandon the urban cities and the industry and business that fuels the nation?

Mike

For all you so-called poverty cases only making $250,000 a year: Try to live on a weekly salary of $480 and attend to a terminally ill spouse, and perhaps you can begin to appreciate how greatly God has blessed you with your wealth. You people disgust me.

Lance Thompson

This proposal is crazy. I guess now I know who I'm not voting for. Fairly enough high income earners already pay higher taxes, own larger homes, and contribute more to the society, so let's punish them. This country was built on the idea of an entrepreneurial dream of striking it rich one day. And now all of a sudden 1% to 2% owe everyone. Nobody was stopping the rest of the population from getting "the money."

dink

The real problem, as I see it, is not where we put the income level where steep tax ramp up ($200K vs. $300K) but rather that the tax system needs to better take into account real costs of living and not tax that or at least minimize it. In other words, taxes should reflect one's ability to pay, which should include cost of living.

Points:
a. The portion of your income you pay out in state sales and income tax shouldn't be taxed at the federal level, because it's money you don't have. This would solve some of the problems that occur if you live in a state with high state taxes. (This is the way it used to work several decades ago, until the laws were changed.)

b. The personal exemptions are far too low. You can't escape paying the basic costs of life, such as food, clothing, rent/mortgage, travel, etc. It's unfair to tax the portion of income that's already accounted for. When the income tax was introduced, you could actually live on the personal exemption amount.

c. Social Security is a highly regressive tax. In addition to being unfair, it also gives the average taxpayer the impression that taxes are too high, which makes it difficult to raise taxes in a rational and fair way.

d. Property taxes are problematic. They are not based on one's ability to pay and they are based on a somewhat arbitrary evaluation of one's home. This also gives the (not incorrect) impression of being overtaxed.

e. College costs are out of sight. I think we have to recognize as a society that there is a tremendous benefit to having a well educated workforce. The income used to pay this significant expense is taxed.

In addition, the direct and indirect costs of the war in Iraq has bled this country horribly. The sad truth is that we or our children will have to come with the cash to pay off this tragic mistake.

We need to come up with a fair tax system that takes into account of people's income and real expenses.

Linda Nelson

My daughter teaches high school and has a 9-year-old son, and we all live in Los Angeles. I hate to tell you, but she has to make due with less than $50,000 a year. She is brilliant, educated, and doing something important with her life. With half her students leaving school before they graduate, we're in for some really tough times. $250,000 is "rich." Ask any teacher.

Amanda

What strikes me as bizarre about this is all the whining these $250,000-plus people are doing about the "cost of living." Wise up, folks. What you do with your money is your choice, and you can't complain about being stretched when you are spending money on totally elective things, such as an excessive mortgage (yes, you have control over how much you pay by carefully selecting your home and your lender) and children (yes, you have a choice of having four or two or one or no children, and a choice of whether or not to pay for them to go to college). To me this is less about whether or not it is fair for wealthier people to pay a higher percentage and more about the attitude of economics, spending, and entitlement. The reason people are factoring in elective things as necessary cost of living is they feel entitled to a certain quality of life. Guess what, folks? You can raise a family of four in an $800 two-bedroom duplex in Milwaukee, Wisconsin, whether you make $50,000 a year or $250,000 a year. If you'd rather have a four-bedroom house and pay a $3,000 mortgage, that's your choice, but don't act like the government has to "factor that in" for you. There are people who are not living beyond their means who would take exception to that.

yaoyao

Just tax the gas at the European levels, and assuming the gas consumption doesn't drop, that's income of $500 billion to $900 billion dollars a year. Enough to give everyone an income tax break or to pay down the national debt. Or if the gas consumption drops drastically, it's still good. http://taxmygas.blogspot.com

Shiz

Ben Richards comment is spot on.

The terms "rich" and "poor" are relative. Making more than $250k ensures that nothing is subsidized. Not retirement accounts, taxes (the AMT is catching people barely making six figures), medical or insurance premiums, nothing. To pay for all of that out of pocket will, strictly by-the-numbers, put this person on par with someone making five figures.

What most posters here fail to realize is whether or not Obama raises taxes on the middle class, or McCain keeps the Bush tax cuts in place, multi-millionaires and billionaires will continue to not pay a proportionate tax rate, whatever that is. UBS is being investigated for targeting Americans making more than $10 million and offering them off-shore bank accounts. These accounts are strictly to avoid taxes. McCain will turn a blind eye while these people avoid paying taxes, and Obama can tax what he can't find so we end up at the same place--the middle class being taxed more.

The middle class pays more tax simply because our money is accessible to be taxed.

Oh, and for the people who earn their $250k, you're arguing with the wrong people. I agree that if you earn your money, you should have to give away more simply because you have more. However, all these CEOs (Ken Lay anyone?) who are making millions by bankrupting the companies they run, getting golden parachutes while the masses are being fired, or by skimming equity from peoples' homes--did they earn that money?

The biggest problem isn't whom to tax. It's getting people to pay the taxes they owe.

goulin

Whenever there is a Presidential election, the debate over tax change will be heated up. To use the tax card to win more voters isn't new to many of us. The question is whether we should increase or decrease the income tax. Obama proposes to increase the tax for the household with an annual income of $250K, but to decrease for the house with less income. This sounds like a good idea for me. For the top 2% richest families, the impact will be minimal while the family with less income will be affected to a larger degree more or less. With the price hikes for food, gas, etc., everybody feels the pain, though the rich people might still do well. But they also need to pay more for every service they used to have. And $1 is not equal to the old $1. I think the key issue here is not about just changing the tax bracket but also the slowing down of economy, and high inflation. Now all the big companies are tightening their belts, reducing their spending by hiring freezing or layoffs. There should be a better plan to stimulate the economy. With the loss of all these good-paying jobs, the federal income will automatically be decreased. With a growing economy, more jobs could be created and more tax could be collected from both individuals and businesses. There is no desperate need to increase personal tax even for the so-called wealthy family. But never cut taxes. This is not a good strategy. Without enough money, many federal sectors will be shut down, resulting in lots of layoffs, which in turn will slow down the economy. Just keeping this as it is will be fine. Don't listen to these politicians. They always change their minds. They never think hard for anyone other than themselves. If you think they are making good policy change for good reason, then you might be wrong.

John

To those who say that we should pay the same amount as a percentage, like a flat tax, I say that is wrong. Who can do more should do more; who has more talents should return more. I say we should as a society only do what is good for the poor and the middle class. The rich will always fend for themselves. We already know that they will not be going to heaven, so why not tax them down here? Just a thought.

1522JW

I live in the Silicon Valley, one of the most expensive places to live. My son was diagnosed with autism, so my wife quit her job to take care of him. Our income has been halved from almost $200,000, and we have added medical expenses. But we are managing okay given our circumstances. These people making $250,000-plus need to give up their Hummers and big SUVs, their $100 meals eating out, and those international vacations they feel they are entitled to every year, and maybe they'll be able to save some money.

SivJay

It's my money, I worked hard to get it. I already pay more than my fair share in taxes, so why should I be punished for working harder than most other people?

When all the other kids in my school were out having fun on a Friday night, I was in the library reading and studying so I could succeed. Their laziness is coming back to bite them on the ass, and now they want my money so they can keep on being lazy?

RC

$250,000 a year. If you can't live well on that, then you are never going to live well. You really are in denial as to how the average person lives and what they make a year. Remember, 80% of Americans do not have a degree, and our economy does not need more degrees but rather better jobs for high school grads. And $50K is more the norm, not $250K, so be happy and manage you money better if you are not living well on a six-figure salary.

SL

I agree that many people want to help the less fortunate--but using other people's money to do it. I also agree that the government is a terribly mismanaged organization.

If we were to stop the war and the millions of dollars of wasteful spending, we could invest more money in government programs. Also, I absolutely hate politicians; they are so corrupt. I consider myself a Republican but refuse to vote for McCain because I view him as a Washington insider. It pains me that the only other choice is Obama, but God forbid he select Hillary as his vice-president.

A flat tax is the best and most fair option. Many people just don't understand the way the market system works.

Hence if we can eliminate the wasteful spending (this includes cracking down on freeloaders who take advantage of government programs), destroy all these tax loopholes that multimillionaires take advantage of, and eliminate power hungry politicians who only play up to certain people's interests so they will get elected again, this country will be way better.

Lanark

Barack Hussein Obama is clearly a Marxist who wants to redistribute money in accordance with his socialist doctrine. That will ensure that the masses will continue to vote for him since he gives them things. That is until they realize he is coming for them.

JoyInLiving

We are a family of four living on less than $40,000 per year. We live simply, and in many ways I feel rich. We struggle for money, but we have our wants/needs in control. I could definitely benefit from better health care, and often don't go to the doctor when I should. I always make sure my kids get good health care, though. The problem is debating relative terms like "rich." I do think that people making more than the current $200K/$250K amounts should be considered at a higher rate, and perhaps that threshold should be adjusted from time to time. The very wealthy have found tons of ways to protect their assets and use lots of them--these are the avenues that should be explored so that there is more equity. Of course, the very wealthy are the ones who have power to control things behind the scenes, and so that kind of change may be unlikely.

Renter

How about eliminating mortgage interest deductions? They disproportionately subsidize the rich.

Gimme a BREAK

No one seems to think that there is far, far, far too much emphasis on money; no jackass is worth 200x to 400x the salary of the average worker. Then they have the company pay through the nose for corporate jets, presidential suites, huge banquets with $1,000 wine and champagne. Then, when they retire, they still try and gorge themselves (like contributors to BW) as if they were His Imperial Lordship. Get a grip, Jack, along with the rest of the bums whose buddies fill board seats with their backsides more than their brains or, on rare occasion that they possess it, integrity. We rejected feudalism in 1776, but too many seem to miss it too much.

Jimmy

This crazy argument of who is middle-class would be completely changed if we went to a consumption tax. The $10,000 spent yields the same benefit to a person making $10,000 or $100,000. You can't eat money, so if you don't spend it, you get no benefit. Not having money is not an excuse to steal it from someone else.

We have been brainwashed for years that somehow a progress income tax is fair because someone making more money is blessed and can afford it, and should subsidize someone who is not.

George Providakes

We have a huge deficit [so much for supply side], a President and Republican party that fought every effort to improve gas mileage, and a failing economy. It is hard to not see at a minimum that the 2001 tax breaks primarily to the upper middle class should not be rescinded, get our budget back in balance (get out or the spend and borrow free lunch world of the Republicans), and address core and minimum essential services on heath, security, food, and shelter. Time to pay the piper for the "free ride" at our children's expense economically and environmentally. Embrace our future with immigration reform--this is our tradition and will swell the tax roles and economy to reduce all of our tax burdens.

Frank

We are all arguing about the definition of "middle class" and "fair taxes" when what we seem to have is a federal spending problem that both McCain and Obama seem intent on ignoring. Obama wants to gloss it over by raising revenue... but only to cover increased spending. McCain wants to gloss it over by leaving revenue alone while adding expenditures (with today's obligations, even doing nothing costs more).

My wife and I make about $300,000. That puts us in something like the 95th percentile of all households in the richest country in the world. What makes us rich, though, isn't our income. It is the fact that we save a hell of a lot more than we spend.

No mortgage. No car payments. No college debt. No credit card debt. It is strictly a matter of personal discipline.

And a measly 2% increase in income tax will hurt us not in the least. Not even a 10% increase in capital gains will matter much. I wouldn't prefer it, mind you, but it certainly wouldn't run us out of the market (which is an argument I have never been able to comprehend).

But all of that is beside the point. This country has a spending problem, not a tax problem. The cost of the national debt and obligations is inherently inflationary in ways that are going to hurt all of you far more than any tinkering with next year's tax code.

Regardless of whatever gimmicks are on offer from McCain or Obama, we should all be demanding that Congress pass a budget that works for us rather than against us over the long haul.

I. M. Middleclass

What makes people think that those who earn more than $250K overspend on luxury items or nonessentials, and that those who make less than that don't frivolously spend beyond their means?

I live in an middle-class neighborhood, and probably earn two to three times what my neighbors make. Yet I typically drive the oldest cars (Hondas and Nissans), mow my own lawn, rarely take vacations (how can I when I work 70+ hours a week?), and never indulge my children with the latest fashion or electronics as my neighbors do.

Why? Because I realize that I cannot count on the government for retirement (a bankrupt Social Security and Medicare), health care, or affordable quality education for my children. Self-sufficiency requires savings, and if that means giving up luxuries, then I'm a practicing master of frugality.

What galls me is to see individuals and families who clearly cannot afford their lifestyles live more lavishly than I do, only to get foreclosed or laid-off, and then complain about it. There are plenty such examples in my suburban L.A. neighborhood.

Americans, along with the U.S. government, need to go on a crash fiscal diet. Blaming others for your own financial misfortune is not the answer. If we all exercised some fiscal responsibility, there wouldn't be cause for the class divisiveness and envy that some have expressed in this thread. But then, that wouldn't be the American way in the 21st century, would it, comrade?

janedoe

$250,00 is not rich for a two-income household in California. It might be in Nebraska. The problem with setting an arbitrary number is that many in high-cost areas will suffer under the tax burden while others in lower cost areas won't really feel it. Numbers should not be set arbitrarily and deemed "rich" or not.

Paul

Okay, I'm a college student living off of credit cards right now. My rent right now $500 a month and bills, just electricity, water, and Internet equal $100 month. Food is $200 month. That's $800 a month, or $9,600 a year. To earn that after, I would have to earn $12,480 a year before taxes. Not a lot. But no one wants to live in a 900-square-foot apartment with a futon, bed, and computer as their only furniture. In eight years, with a Ph.D., I will be approximately $400,000 in debt ($40,000 a year, 10 years). Now, student loans stink. By the time I am able to pay them all off, with an interest rate of 10%, paying 10% a month, that turns into (that's 40,000 a month) after one month, I'm left with $396,000. It's going to take a while to pay all of that off, about eight years. Now, to earn $40K a month, that's $480K a year before taxes. I don't know about you, but I won't be earning that, I hope for half that. Half of that $20K leads to 5% payoff with 10% interest, after one month, I'm $418K in debt, after paying $20K. That's not good. So the point of all of this is:
a) my math sucks and I need to find a new degree path
or
b) $250,000 ain't nearly wealthy (I haven't figured out taxes, just student loans).

Seriously, I'm busting my butt, and Obama is saying the harder you work, the more I'm going to penalize you. I don't like that.

Bobz

I hate to break it to this audience, but $250,000 and up will let you live very comfortably anywhere in the U.S. I live in the San Francisco Bay Area and have no problem living very nicely on half of that amount. We are talking about the upper middle class here. The proportions they spend on food, gas, and the other necessities of life are way less than the family earning the median. Even under the old tax structure, we had no problems paying the FIT, and neither should upper middle class folks. They are coming across as a bunch of "whiners." They should be damn happy they are pulling down that kind of money and paying their fair share of taxes in our society.

Taxman

Hey Bobz, since you're so comfortable living on a $125,000 salary in San Francisco, let's do the right thing and increase taxes on everyone making more than $100,000. It's only fair to spread the pain, right?

doc

I am a doctor and make decent money. My jaws dropped this tax season when I looked at my tax bill. I am frightened about my tax bill should Obama become president. I work in south Texas bordering Mexico and see such abuse and misuse of Medicaid and other government programs; practically the whole town is on Medicaid. Basically, people are married in Mexico but don't register as married in the U.S., will have a bunch of children (to a "single mother"), and get Medicaid and other benefits, all the while working in a kind of cash economy that is under the IRS radar. People on Medicaid are driving luxury SUVs and carrying Coach bags to Wal-Mart to cash their food stamps.

This U.S. government is run by a bunch of naive and inept fools, and people here are laughing all the way to good and easy life posing as beggars.

The Federal government has to come to its senses and cut down this gravy train of entitlements, or this country will go to dogs.

Brian Pellin

Paul,
You aren't paying 10% on your college loans. It's probably 6% to 8% depending on whether it's a Federal Stafford loan or a private loan from a bank. You probably gave the loan documents to your parents to sign. Read the fine print.

I'd worry about the credit cards; the interest rates are usually higher. And the total amount of your indebtedness will be more than $400K, with interest, so plan on paying almost twice that. Plug these figures into a financial calculator (even an online mortgage calculator will work) to see the relationship between principal and interest. Stay away from bankers--they're all crooks.

T.O.

My husband and I live in the Midwest and are each educated and working full-time. Our combined salaries bring us over the $150k mark annually. We are still in our 30s, very ambitious, and have hopes to continue furthering our careers. When tax time arrives, I feel as though we are very cheated by our own government, and if Obama is elected, fear things will only become worse. We are comfortable, but not rich. We've come to a point where we "make too much money" to even be eligible for certain tax breaks. Yet nobody is considering that 25% of my husband's income is going to his ex-wife to care for the two children they have together. We don't even see that money, and suffer by having to be bumped to a higher tax bracket. Voting for Obama would be like pouring salt on an already open wound. It is not fair to think that the rich (whatever household income that may be) should carry the burden of new programs or other initiatives Obama wants to implement if elected. A broken system will only become worse. It takes away the incentive to prosper in this country. Yet I see the very poor continuing to get every break in the world instead of being held accountable for helping to share in the burden of tax. There has to be a better way. I have always had a tendency to support the Democratic party, but have been especially disheartened with how they propose to handle health care issues and raise taxes.

bob

How Taxes Work

Since it is tax season, it's good to understand how taxes are paid.
Let's put tax cuts in terms everyone can understand.

Suppose that every day, ten men go out for beer and the bill for all ten
comes to $100.

If they paid their bill the way we pay our taxes, it would go something
like this:

The first four men (the poorest) would pay nothing.
The fifth would pay $1.
The sixth would pay $3.
The seventh would pay $7.
The eighth would pay $12.
The ninth would pay $18.
The tenth man (the richest) would pay $59.

So, that's what they decided to do.

The ten men drank in the bar every day and seemed quite happy with
the arrangement, until one day, the owner threw them a curve. "Since
you are all such good customers," he said, "I'm going to reduce the
cost of your daily beer by $20." Drinks for the ten now cost just $80.

The group still wanted to pay their bill the way we pay our taxes so
the first four men were unaffected. They would still drink for free. But
what about the other six men--the paying customers? How could they
divide the $20 windfall so that everyone would get his 'fair share?'
They realized that $20 divided by six is $3.33. But if they subtracted
that from everybody's share, then the fifth man and the sixth man
would each end up being paid to drink his beer.

So, the bar owner suggested that it would be fair to reduce each
man's bill by roughly the same amount, and he proceeded to work
out the amounts each should pay.

And so:

The fifth man, like the first four, now paid nothing (100% savings).
The sixth now paid $2 instead of $3 (33%savings).
The seventh now pay $5 instead of $7 (28%savings).
The eighth now paid $9 instead of $12 (25% savings).
The ninth now paid $14 instead of $18 (22% savings).
The tenth now paid $49 instead of $59 (16% savings).

Each of the six was better off than before. And the first four continued
to drink for free. But once outside the restaurant, the men began to
compare their savings.

"I only got a dollar out of the $20," declared the sixth man. He pointed
to the tenth man," but he got $10."

"Yeah, that's right," exclaimed the fifth man. "I only saved a dollar, too.
It's unfair that he got ten times more than I"

"That's true," shouted the seventh man. "Why should he get $10 back
when I got only two? The wealthy get all the breaks!"

"Wait a minute," yelled the first four men in unison. "We didn't get
anything at all. The system exploits the poor."

The nine men surrounded the tenth and beat him up.

The next night the tenth man didn't show up for drinks, so the nine sat
down and had beers without him. But when it came time to pay the bill, they
discovered something important. They didn't have enough money
among all of them for even half of the bill.

And that, boys and girls, journalists and college professors, is how
our tax system works. The people who pay the highest taxes get the
most benefit from a tax reduction. Tax them too much, attack them
for being wealthy, and they just may not show up anymore. In fact,
they might start drinking overseas where the atmosphere is somewhat
friendlier.

David R. Kamerschen, Ph.D.
Professor of Economics
University of Georgia

For those who understand, no explanation is needed. For those who
do not understand, no explanation is possible.

superduperdave

We're talking about the well-off, not the rich. I define someone as rich who can live quite comfortably off of their investments without working. In our society, that means the owners, not the hard-working managers.

steve

The family in the article makes $300,000 a year or $25,000 a month. Even going back to the tax rate under Clinton, they would pay $80,000 and so they would keep $18,000 a month. Now he does pay 3,000% a month for the mortgage, but that is either deductible interest or principle that is paid to him. He pays $2,000 a month for medical school debt. He may pay $1,000 a month to Pennsylvania and $1,000 a month property tax, which is deductible. Considering that investment is what lets him earn in the top 3%, he got a bargain there. I estimate he also puts at least $20,000 to 40,000 into a pension, but that is deductible and is money paid to himself.
So this leaves him $11,000 a month to live on. Gas and food are going to be small percentages of this $132,000 a year. The reality is this money will either be saved or spent on discretionary show items such as second homes, fancy cars, or the biggest money sinkhole, a boat, or charity?

This country is becoming more poor spending more than it takes in, buying more than it sells, and fighting a questionable war on the credit card. Robert Kennedy pointed out that if we want an opulent private sector and decayed public sector, we will continue to get results like Katrina, the Iraq war, and rank 37th in health care. It's public investment that funds the basic research, and our legal system that supports the private sector.

RC

Don't worry with the multi-nations outsourcing the white- and gray-collar jobs now like they did the blue-collar and skilled jobs in the 80s in 90s; the middle class will not be around in 10 more years. If you make $250K or $50K, all but the top 2% are losing ground. If you are lucky enough to make $250K a year, you are living well. Given McBushes position on the economy and taxes, it may only be five years until the United States of America looks like Mexico or Communist China, very rich, no middle, and very poor with the army keeping everyone in its place. We all work hard, but not all of us are paid a fair wage and not all the employers really care about our country as they lower our standard living down to that in Communist China. Let the good times roll--everyone making wages so low that we are the low cost produce of every service and product. This is the America that we are leaving our children.

PNW Trojan

First: The crux is that Congress and its incumbents are robbing us while we whine and snivel. Then, we go and put the same crackerjack back in office. Yours is a crook; mine is a crook. Let's get rid of all incumbents. Second: In California, yes, living costs are higher but anyone who bought a home and lived in it for 20 to 40 years knows that you make a killing selling it. That doesn't happen in Texas, Iowa, Pennsylvania, or podunk. Even the richest putz in Beverly Hills or Malibu or Pacific Heights and Woodside, can't escape the nightmare of traffic--a great equalizer.

Steve

Clearly not one of you knows anything about economics.

David Forrest

The complaints about Obama and taxes are, to put it mildly, nuts. Regardless of who becomes president, a $9.4 trillion debt and the coming crisis in Social Security mean that taxes will go up as a share of GDP. We cannot borrow indefinitely, and we have expenses that need to be met.

These expenses benefit "high-earners" as much as everyone else (and probably more so). Here's a short list:

Health care. Rich, why are Ford and GM unable to compete in the global economy? In large part because, unlike their competitors overseas, they are forced to act as health care providers for their employees. This is crazy. Shifting the funding of health care away from the corporate sector will enable American business to compete. This will improve the economy in the end, but it will cost money.

The military. All of the "lazy leftists" fighting for our nation overseas need to be paid, educated, and supported when they return. This isn't cheap. (Of course, McCain feels we could save a few billion by not providing them with the same educational benefits that he and his family received.)

The environment. $250,000 will go even less far in Manhattan when portions of it are under water. Addressing global warming will cost money (not addressing it will cost much more money). That money will improve our economy and our health. It's well worth it. But we need to pay for it.

Financial security. Why can't we have meaningful inspections of counterfeit drugs made in China? Lead-painted toys made in China? Poisonous food from China? Stopping these abuses would only improve the ability of American businesses to compete, after all.

Because we need China to continue to float our $9.4 trillion dollar national debt, we can't risk antagonizing them. We cannot run a meaningful foreign policy until can we pay down our debt.

Social Security. Why are high-earners willing to risk their savings on starting businesses and investments? In part, because they know that in the end there is a safety net to fall back on if those ventures don't work out.

The millions of Americans who worked hard and paid into the Social Security system deserve to get what they were promised. Sure, we can cut benefits somewhat, and we'll have to. But it's going to cost money.

Roads, schools, and infrastructure.

A nation is like a house. You can fool yourself into believing that you can save money on your house by putting off repainting it or fixing the roof or by borrowing money to pay for that kind of thing instead of taking it out of your monthly budget. If the previous owner did a very good job with the house, you can even get away with this for several Republican administrations.

But in the end, owning a house means you have to maintain the house. And putting repairs off only makes them more expensive in the end.

We've put off maintaining our nation's infrastructure, using every trick in the politically correct free-market tax-cut book, and now we have to face the music. If we'd paid what it cost to maintain the country in the 80s, we wouldn't be in this mess today. But we didn't.

So sit down, shut up, and pony up, folks. It's time to pay our bills.

Chris

Ah, class warfare. While the wealthier people in this country (the top 2%; $250K and up) bicker with one another and with those who work just as hard as they do but earn less, a revolution is growing right under their noses. The "poor" are going to rise up and get their share--whatever's necessary to secure what is rightfully theirs, the working people of the U.S. will succeed. There are 98% more of us than of you. You have been warned.

Young Professional

I am a life-long Democrat, and will certainly be voting for Obama come election time, but I have to say I often find myself getting angry with other members of my party when they tell me I should be paying additional taxes because I make too much money.

My wife and I are both professionals, and both under 30 years of age. Combined our income is just under $200K per year. However, if you think we drive Mercedes and carry Coach hand bags, then you are mistaken. Nope, we live in an 800-square-foot one-bedroom apartment in a "transitional neighborhood" (aka a dangerous neighborhood), we don't even own a car, and all our clothing is purchased at either Target or TJ Maxx.

What a lot of people don't realize is that to earn an income like ours requires two things: 1) a lot of expensive and time consuming education, and 2) living in a high cost of living area. Between the two of us we carry in excess of $300K in student loan debt (about $4,000 a month in payments). When you tack on rent ($2,600 a month) and taxes ($6,800 a month to pay all city, state, and federal taxes) that doesn't leave as much as you'd think for savings and discretionary spending.

$200K per year = $16,666 per month = $9,866 per month after taxes.

$9,866
-$4,000 student loans
-$2,600 rent
--------
$3,266 per month before paying for food, utilities, or health care; before making 401K and IRA contributions; and before making any charitable donations. This doesn't even consider that due to the length of our educations we have only just started to draw an income at all in our late 20s

I don't want to complain; obviously we don't struggle to make ends meet. At the same time, we can't afford to purchase a home, and if we have kid we will really struggle to fund their educations as the public schools around here are not effective or safe.

We are fine with our lifestyle and don't think we are entitled to anything more. We have chosen to live where we live and do what it is we do for a living. Just like everyone, we hope that eventually our hard work will pay off and we will get ahead.

However, it is extremely tiresome to constantly hear that we should be taxed more because of how much money we make. Often the person yelling that we should pay more owns their own three-bedroom house, owns a least a couple of cars, and has been in the workforce for an additional 5-plus years, all while living in a much lower cost of living area. Materially, they are better off in every way than my wife and I. They also generally work fewer hours and have invested much less time and effort into their educations. Yet for some reason it is us, not them, who have too much.

BIGWEEDS

I believe the USA should sell reserves now and make money, and when word gets out that we are selling some of the reserves, oil prices will fall and then the USA can buy back oil to replenish the reserves. You know--buy low and sell high. Maybe our politicians skipped that course for some reason.

bucket

Rich is mostly measured by assets, not by income. If you are in debt and making $500k a year, you are not rich. Then there's plenty of old-moneyed (inheritance and such) people sitting around on a hoard of cash doing nothing; they can easily have high income from dividends and capital gains, and only paying 15% tax, that's BS. I think non-earned income needs to be progressive just like earned income.

colson

I can't believe the number of people who favor government-sanctioned theft. I have no claim on anyone else's money. I didn't earn that money. I didn't invest or spend that money.

Instead of taking it through taxes, why don't we give free guns to the "poor" and let them take the money from the wealthy with a gun to the head? It ain't a pretty solution, but that is essentially the point when you taking someone's money by threat of government and the taxman.

Lauren

First they came for the Socialists, and I didn't speak up,
because I wasn't a Socialist.

Then they came for the trade unionists, and I didn't speak up,
because I wasn't a trade unionist.

Then they came for the Jews, and I didn't speak up,
because I wasn't a Jew.

Then they came for me, and there was no one left
to speak up for me.

Most of us don't make $250k/year, but taxing those people more won't solve the problem. It just delays our hour of financial reckoning as a nation. Next they'll tax those making $150k. Then $100k, then $50k. It's not you now, but it will be.

We're bleeding money left, right, and center. Meanwhile: Our poorer public schools turn out delinquents who can't read. We have teenagers dying in Iraq. Our medical infrastructure needs a major overhaul. The crash of Social Security is already in motion. Savings are way down, and commodity prices are going the way of oil prices.

Taxing any one group more will not solve things. We must reevaluate our spending, just as those who will bear the burden of the next tax hike, a tax hike that's coming, like it or not.

Gimme a BREAK

Are any of you surprised that so many wealthy (they don't need to serve in the military) begrudge paying taxes, but don't mind the unbridled waste by this Administration, as it enriches war profiteers and wholesale fraud at the Pentagon? Huge loopholes for some, nothing for working families. Look at Bush and FEMA. Bush and ethanol. This list is just too lengthy. The Democrats under Obama will squander even more hundreds of billions on illegals, unions, and their own lobbyists. Why aren't you angry? All of us are being robbed, but many of you blame citizens, instead of politicians. That, is really stupid.

Sgi

Obama is catering to the poor to get their vote. This is no mystery. $250,000 is not rich. Tax the corporations making billions. Lock our borders down, and get taxes from all the illegals in the country. That will solve this issue. Oh, I forgot, are we still getting them driver's licenses?

Barron

Two points:
(1) An annual income of more than $250K a year doesn't make someone rich. It just makes them a high wage earner. There can be significant student debt, high cost of living expenses, etc. Assets make someone rich, so taxing those greater that $250K isn't necessarily taxing the rich.
(2) Those who are in the greater than $250K range worked hard to get there. I would suggest that the group of people in that bracket worked and is working harder than those who make less. A high-earning M.D. probably went through eight years of school, a year of internship, and several years of residency, scraping by to hopefully realize the dream of securing a future for their family. Now the reward is potentially more taxes to fund inefficient government programs and pork barrel projects.

I have another suggestion. Those earning less that an "equitable salary," skip that $150 pair of Nikes, a two-pack-a-day smoking habit, cable TV service, an excessive cell phone plan, rims for your car and bling for your neck--and try living within your means. Once that happens, you can sock a way a few hundred a month, accumulate wealth, and have that rainy day fund to cover any unforeseen health care expenses that Barack seems to think I should subsidize. Also, that person may save enough to be able to send their kids to college (if they are too lazy to work and incur the student debt to get finish themselves). The miracle of compounded interest works well if people can just invest in their future.

rich

When a "rich" person is strapped by losing equity in their McMansions, and proposed higher taxes, non-rich folks suffer as well. It trickles down. I've stopped getting manicures every week, and now go only for special occasions. This causes my manicurist to lose money. And my ex-personal trainer and my poor contractor. I kept him in work for years before this year caused us to cut back. Now he hasn't worked in weeks and calls me to see if I have anything for him. My housekeeper is still here, but she used to come every Saturday night to babysit and would earn $100 from us. She's not getting that very often anymore, and with food prices going up and gas, it's got to really bite into her budget. I haven't been to that cute little boutique owned by a "not rich" person in over a year. I buy my clothes at Gap and Old Navy, and wait for sales. Besides, I have plenty of clothes; I don't really need them anymore. All those waiters at the restaurants that are slowing down aren't making much anymore. The car dealer didn't make any money on me this year. When my BMW lease ended, I just turned it in. I bought a Prius instead. The guys at the car wash are not doing so well these days. I didn't need those luxuries, but they were nice and provided money to others. We don't need to pay more taxes; we already pay the max. By making money, we spend it and create jobs for those who make the products we buy.

My charity-giving has suffered as well. You know all those silent auction events? We don't go much, and when we do, we don't bid very high on stuff. I've noticed that items are going for far less than they are worth. The organizations that rely on us for funding are hurting.

I have far less clothing to give as hand-me-downs to my housekeeper's church. We rich are not evil, just lucky and most of us spread it around.

Malcolm

Everyone should have to pay for the changes that we want to see in America--not just the "wealthy."

Ed Silicon Valley

$250k in Silicon Valley is break even, my friends. The cost of living here is high mainly due to housing. Maybe ten years ago $250k was a lot, but not today. Real wealth starts at $1 million or more in income and is measured by net worth, not wages.

We have a spending problem in D.C., not taxes. Are you that naive? Why does the area around D.C. have the lowest unemployment rate? We are doomed with our government budgeting system. There are no controls to curb spending like your own personal situation or a business. Plus politicians get reelected based on how much they spend in their jurisdictions.

In addition, people are forgetting the additional tax that would be imposed by removing the Social Security ceiling limit on (6% employee and 6% employer). The effect on small businesses and the self employed would be devastating. The impact on hiring just as bad. Each employee may cost more.

Again this is nothing more than income redistribution. Why is it the same folks who want to grow the economy give out money/rebates, but then say they want to raise taxes and it will grow?

If you want to measure rich you should look at net worth, which is the true measure. Why punish those who are working their way up the economic ladder as opposed to those that are on the top living off of trusts? Why? Because it is easy to tax wages.

America, get smart and tell your politicians enough is enough with the wasteful spending and resulting taxes. Read the economist Milton Friedman's Free to Choose, and you will not want higher taxes.

Mike

If you can't live on $100,000 a year, you're living beyond your means. Yes, the government taxes us too much, but the examples of hardship in this article are laughable. It's hard to empathize with people who won't manage their money more carefully.

Nick Loria

My household earns more than $250,000 per year, am I rich? Hell no.

Saving for college for two children. When they reach college age 16 years from now, the estimated annual tuition for a mid-level school will be what? $80K. Mortgage payments, enough said. Maintenance to upkeep your property.

Oh, practices taxes New York had raised more than 20% over the last several years. Oil to heat your home--tripled for my house. Nanny and babysitters---that's right we need them so we can both work and make more than $250,000 per year.

Private grade schools, no. That's why we live where we live, because grade school education is very good. Perhaps if New York City public schools were better, I'd have more options

Gas for the two cars; let's not forget about that. I estimated between gas and heating oil, my bill is now north of $20,000 net per year. Metro North train tickets in order to get to work. Nursing home bills for elderly parents. You see, I didn't come from a wealthy family.


Many people like me are trying their best to provide a better life for their children and be productive citizens, but enough is enough. The definition of wealth needs to change.

goUSA

This debate is a nonstarter because we were all tricked by a sleight of hand. Some person in the federal government draws a line--over or below $250k. And draws out the worst in us. We now "hate" the rich who make more than $250k.

No, Obama is wrong. He's just whipping up more votes. Government economists will tell you--the IRS doesn't want a higher tax rate, not even higher tax revenues, just more budget for its departmetns.

Do we really put our future in the federal (or state) government?
Domestic spending--this is the group who ran up a $9 trillion debt.
Charity--this is the group who tortures prisoners. Foreign spending--this is the group who can't squash a couple little countries.

The real debate should be, how are we going to muzzle the group that keeps misusing all our money?

And by the way, if I become rich one day, like in the American dream, apparently you all will hate me and I'll have to move out of America.

Carl Turner

I like the idea of raising taxes on everyone who claims to support the war in Iraq, the only exceptions being for those who serve in the armed forces or sent a family member to serve. If people really support the war, they shouldn't mind paying for it, and not burdening the next generation with this generation's bad choices.

Dezl0ck

The problem with national politicians determining what is wealthy is that it does not take into account local conditions. Entry level middle class housing with one or two bedrooms is in the $800,000 to $1.5 million range if you live in the city. That is $5,870.12 per month on the low end and $11,006.47 on the high end with a 30-year fixed at 8%. You're not going to be buying that first house/condo unless you are making at least $150,000 and single. If you are in places like San Francisco, Atlanta, or New York, a combined household income of $250,000 (or single $125,000) is middle class. The national politicians have not kept up with the housing market and other cost of living expenses. In the 1980s, $30,000 was considered the upper end of the middle class spectrum. Today I know people without college degrees pulling in $90,000, and your typical college grad starts out in the $70,000 range. A tax on the so called "wealthy" is nothing more than robbing the urban middle class and distributing the money to the rural middle class or perhaps, more accurately, robbing the urban east west coasts and redistributing income to the rural midwest.

E

And never forget: Politicians don't pay the same income taxes everyone else pays. They don't participate in the Social Security program, so they don't have to pay for it. They don't participate in Medicare/Medicaid so they don't have to pay for it. I don't know about you, but it's never made sense to me that the people who make the decisions on whom to tax don't participate in the same system as those who have to pay for their decisions.

Obama is not volunteering to pay more taxes, because he's not in the same class of earners as those who make $250,000 a year; he's a politician.

OBAMA 08'

Random: Very well put. You took the words right out of my mouth. Thanks for breaking it all down.

Being wealthy is certainly relative. For those of us outside the top 2% who don't use government programs, who work hard, are well educated and productive citizens, we are suffering, too--harder. We feel the pain of rising gas and food prices, day care increases for us just the same, college tuition goes up for us just the same, etc. I can go on and on. It's hard for me to sympathize with the "wealthy," because even after the tax increase and rising costs of living, you still won't have to struggle to make ends meet. And if you do, then you have a problem bigger than raising taxes.

KB

This debate is ridiculous. The real debate is how we should be reforming our tax system, and ask the real question: Why does our government need this much tax revenue?

Just continuing to tax the rich does nothing but stifle innovation and the economy. A tax on cigarettes acts to stifle cigarette smoking. A tax on income acts to stifle making money. If you take away the gold under the rainbow, no one will be looking for it.

The people supporting a tax like this have been tricked into thinking the rich are to blame for everything. Quite the contrary. Without the top 1% of wage earners, we would have half of the tax revenue we have now.

And if you think that taking out a rich person just allows the next guy down to step up and be rich, it is a fallacy, especially today in a global market. We are now competing with the rest of the world for our jobs, and you retards are gunning for the people who are creating the jobs in America.

Anyhow, the train has already left the station. And the feeling of entitlement that people have is already well on its way to destroying this country. I hope you all enjoy the fruits of all your whining.

Dr. Joe

I love the implication that someone who makes $50,000 a year is somehow not as hard of a worker as those in the $250,000 bracket. What a joke. It's typical Republican boot-strap banter designed to make them feel better about looking down their noses at the lower class. Why should you pay more taxes? Because that's what a society does--that's how a society pays for the civil services, and the infrastructure that keeps this "great country" running. If all you greedy Republicans with your $250,000 incomes did what you wanted (i.e., not pay taxes), our country would be falling apart. Oh, my mistake--that's exactly what's happened over the last eight years. Thanks.

Remash

Flat tax it across the board. That is fair.

Hondo

Since when did it become a crime in this country to be work hard, be successful, and make money?

Believe me, you are not rich making $250,000 in New Jersey. I get to pay $15,000 in property taxes and $3,000 for a mortgage and have to fund my own retirement and college for my son while watching state income taxes shipped off to other places in the state.

Everyone wants someone else to pay for them. There are no free lunches anymore. The one question come election day you need to answer is: Are you willing to pay more? If the answer is no, it does not matter how much you will be making, to fund all the programs proposed, you will be paying more.

Bill Jacobs

Everyone gets taxed the same?

Hokey doke.
Be careful what you wish for.
Everyone will get equal Securities and Exchange Commission oversight.
Everyone will get the same Coast Guard coverage for sea rescues.
Everyone will get identical access to the court system for contract enforcement.

The rich pay more because there are entire branches of government that the poor never use.

The largest three, interest on the national debt, Medicare, and Defense are all used by the wealthy (after sheltering their assets to qualify for Medicare.)

Defense. Why? What do the poor have that's worth invading for? "Defense" is used for offense as well and protection of "our way of life." Who is most troubled by the idea of disruption? Those most pleased with the country as it is. The ones with the most to lose.

Interest on the national debt. Any idea who is holding the bulk of T-bills? Not the people in the 15% bracket, I put it to you. Those T-bills are paying for that massive defense budget. Who's ordering the purchase of that weaponry? Not the guys on food stamps.

Police hunting down stolen goods--who has the most that needs to be protected? Fire--who has the most to burn? Coast Guard--who is it on those ships at sea caught in a squall? Who owns the cargo?

Who's paying too much again? Think it over.

Ed Silicon Valley

The cost of the average home in Silicon Valley is more than $1 million. You can have my mortgage anytime. The nice communities are more than $2 million. I thought that when I made $250,000 I would be set. Was I dead wrong. Pay check to pay check.

The California state tax rate for more than $50,000 is 9.6%. Social Security and Medicare/caid is 7.5%. Right from the start 17% is gone. After property taxes, gas taxes, sales taxes, and use taxes, plus funding your retirement, you are not left with much. This is not the very rich. The very rich have their money in trusts that they have inherited over generations.

The average Joe making around $250,000 cannot afford the tax expertise that the very rich can. Their money flees high tax jurisdictions, and I have seen this happen. The very rich in my state move to no-tax states depleting revenues for California. Some out of the country.

Bottom line is that if you grow the economy, the tax base grows as well as the tax revenues. Economics 101 lesson: For every $1 that goes back to the taxpayer, it turns over 10 times in the economy and creates additional tax revenue. Did somebody recently say rebates were good?

The bottom line

Obama is Robin Hood. I'm nowhere near the $250,000 mark, but still think that the main problem is the government handouts. Why don't we start working harder and stop relying upon the government to support them? If you bought a house that is being foreclosed upon, that's good because you probably couldn't afford it to begin with. The government already has a system to help people who fall on hard times. It's called bankruptcy. So pull yourself up and start working harder.

I'm tired of all the people in my income class complaining.

FELAM

San Francisco Bay Area Monthly Expenses:
Mortgage/insurance for modest 3-bedroom house: $5,200
Car payment/insurance/gas on 2006 Toyota Van: $1,100
Health insurance for family of 4 paid out of pocket: $1,280
Groceries for 4: $1,800
2 kids college savings: $1,000
Utilities for house:$1,000
Misc. Family Expenses: $2,000
Retirement Savings (company does not offer any kid of retirement): $2,000
That's $13,580 a month I shell out just to exist. I am by no means rich even though our combined salary is close to the $250,000 a year. There isn't much left over. Look further up the ladder because you haven't found the rich here.

Gila

Germany is using a sliding scale for Social Security, income taxes, and health insurance. And I wholeheartedly agree.

Why would you want to cap certain expenses, depending on income? I currently pay:
- 12,5% health insurance
- 10% pension plan
- 12% unemployment and care plan
- 15% income tax
- 8% solidarity (ex DDR)

Those are all mandatory taxes, by the way. Meaning of my $50,000 annual income, I take approximately $2,500 home. If my income goes up too much, I will pay a higher % income tax.

I can see that a family of 5+ will not consider $250,000 "rich," but I am sure that a number of kids would be figured into that number.

For me, $250,000 is definitely comfortable--comfortable enough to carry some of the weight of the people who are making a lot less.

Vishnu

I see a very funny pattern here. All those who earn $250,000 and above believe they have worked hard for it and deserve it, which conversely means they think those who earn less than $60,000 deserve lower pay since they have not worked hard enough.

I am thinking whether they have ever asked themselves how much a teacher, a professor, a police officer or a firefighter, or a nurse earns.

Has the good doctor asked himself lately how his son's or daughter's teacher keeps up his/her motivation while trying to live on a $60,000 pay?

Vishnu

One of the things I find interesting is how much you gripe about not being able to control expenses when, with some little planning and some amount of inconvenience, you can bring down your expenses a lot. Quite a lot.

Before the current crunch and rise in prices, I used to go shopping whenever I ran short of something, I used to drive to the gym and work in my RAV4, and I used to stock my fridge with necessary and unnecessary things.
Now I
- Plan my shopping trips
- Bike to work (I stay 8 miles away) and buy fewer items when I shop.
- Plan my big shopping trips, and I throw fewer things away.
- Watch the food network and other online cooking sites and cook at home

You have no idea how much less I am spending monthly now, and there are fringe benefits. I dropped out of my gym since I was getting good exercise almost every day. I am anxious to get into the office every morning (biking 8 miles is hot). My gas bills are nonexistent. I spend less on car maintenance. Also planning my shopping trips has cut down on my fuel as well as shopping expenses.

Additionally you can earn money selling things you don't need on eBay. Desperation drives innovation. Too much comfort makes you useless.

The thing is we have a way to control expenses. Now this is applicable to everyone. People earning $250,000 or more have a lot more money, and they can save.

Note: I think the tax should not be blindly based on a slab $250,000. It should have a component multiplied to account for cost of living. That way the slab will be higher for Silicon Valley, New York, etc.

Kate

Who cares if they are rich? We spend $350 million a day on the war in Iraq. No tax on people making $250,000 a year is going to generate that much income.

Eli Bildirici

To suggest that those at the $250,000 mark aren't any better equipped to handle a souring economy than those making $50,000 to $80,000 is folly of the worst sort. They may not be comfortable, no, and I'd probably want to put the mark a bit higher, but please. All men are not created equal. People are divided and subdivided a hundred fold, and sometimes, a society should try to look after their less fortunate.

John Kievlan

A certain perception of liberal policy seems to pervade the thinking of the so-called "wealthy." Many people seem to think that the liberal position is something like this:

"The very poor are suffering. Rich people, on the other hand, are hoarding money, buying useless toys and laughing at the misery of the downtrodden."

Whereupon the wealthy respond indignantly:

"Who told you we're wasteful playboys? We need our money. We're doing useful and responsible things with it. We're planning for retirement, putting our kids through college, and feeding and sheltering our families. Sure, it sounds like we make a lot, but once we take care of the essentials we have very little left over."

I can't speak for other liberals. But for my part, I have never had the illusion that the "wealthy" won't have to make sacrifices to fix the rampant misery and injustice around the world. I am not under the impression that $250,000 means "$50,000 for important things, $200,000 for parties."

Yes, of course, the wealthy are hurting, too. Of course, if we raise their taxes, they will have to make sacrifices. And of course, if I knew any way to avoid the need for these sacrifices, I would not ask it.

But let's keep things in perspective, folks. I sympathize with the doctor who is worried that he isn't putting enough into his 401K, and may have to save even less if his taxes go up. Paying into a 401K is an important and responsible thing to do, and I respect that.

But do you know what I worry about? I worry about whether my little brother (who I support on a $50,000 income) and I should eat dinner at night, or just tighten our belts until breakfast the next morning. I worry about whether I can keep him in school, and about how I can get him a broken-down wreck of a car so he can get a job at Subway or McDonald's.

And I have neighbors down the street who worry about whether they can eat at all today. They worry about whether they can buy their kids shoes so their feet don't blister and crack.

And every low-income-earner in America today worries about affording regular medical checkups. They worry about going to the checkup even if they can afford it, because if the doctor finds anything wrong, they will go bankrupt and lose everything trying to pay medical bills. They can't even afford antibiotics for their children if they get injured.

In that light, is it really so terrible if the good doctor can't save enough money to maintain his standard of living into his old age? Or if, perhaps, he has to buy a smaller house, and his children share rooms? Or if he has to sell his car for a used Kia? How is that hardship, compared to the hardships of the poor?

Yes, it is sacrifice, but what a small sacrifice compared to the life-destroying sacrifices the poor must face. And does anyone really believe that the world can make any real progress if nobody is willing to sacrifice?

Bob

Bunch of baloney: Obama needs to come and live in the Silicon Valley/Bay Area or New York City. Here in the Bay Area, $200,000 is made by pretty much every two-income family, and all are struggling with the highest cost of living. If they raise tax, it should be indexed with the cost of living like the conforming rate for a mortgage. An average 2,000-square-foot house in the Bay Area costs $800,000.

Obama is nuts.

Benoit

I agree that we should not be sparing the wealthiest Americans taxation, but $250,000 is a lot of money in only some places. In New York, I pay $700 a month for a very small studio apartment in Queens (and I am under market), that is partial basement. In Pittsburgh this $700 would get me at least a one-bedroom apartment (if not two) in a pretty nice building in a convenient area. The fact is that my $42000 per year is a ton of money in Pittsburgh, and in New York, it is nothing. If Congress wants to tax billionaires 60% I am for it, but $250,000 in New York City is not very fair.

Roxanne

My husband and I both came from humble backgrounds, paid for our own college and graduate school educations, and sacrificed a lot to graduate and get good jobs. We now both work nearly 80-hour weeks and a lot of times more than that to make our $250,000-plus combined salaries. What do we get in return? Higher and higher taxes, including the inevitable AMT tax bill at the end of the year. We live in the Bay Area and are struggling to buy a modest-sized home. We don't drive "luxury" cars, wear designer clothes, or take extravagant vacations, nor can we afford to contribute to an emergency savings account, but somehow we're considered rich? It's absurd and infuriating. We're supporting millions of people who chose not to better themselves and get an education or chose not to do well in school and get a high-paying job. Or chose not to have a job that requires long hours for high pay. America isn't a socialist society (at least it's not supposed to be), and we shouldn't be forced to support the laziness of others. If someone works hard and gets paid well for it, she or he should have the ability to enjoy the fruits of the labor instead of writing yet another check to the IRS to subsidize someone who chose to get a job at Safeway rather than going to college. Obama is dead wrong when he says that we don't "need" a tax break. We already don't get most of the tax breaks others enjoy: student loan interest deduction, the tax rebate checks, dependent tax deductions, house tax deduction, etc.

If the tax system is going to be "fair," then everyone should be taxed the same percentage, regardless of income, and enjoy the same tax benefits. We shouldn't be forced to wonder if we'll be able to pay our mortgage after the election, because Obama decided we don't need a mortgage interest deduction and decided to raise our income taxes.

mark

"We're supporting millions of people who chose not to better themselves and get an education or chose not to do well in school and get a high-paying job. Or chose not to have a job that requires long hours for high pay."

This assumes that we all have full control in these matters. Long hours do not always equal high pay, and not everyone won the genetic lottery and can excel at school.

goUSA

Two more points:
1. This debate provides proof that Obama is out of touch with American people.
2. Income tax is the evil here. Witness how it turns Americans against each other.

Look at how inflation has pulled ever-higher tax brackets on the middle class. $50,000 used to be rich. Now it can't help one make ends meet. The same thing is happening at the $250,000 mark.

For crying out loud, we are talking about an increase from 35% to 36% for $250,000 earners.
The dramatic accusations and the back-and-forths in this debate are about injured egos.

So many of us in this debate feel wronged. Because we all think of the "rich" as some other group who deserve to be taxed to death. Not us.

Now move on to the alternative minimum tax (AMT) that kicks in at $160,000. Guess what? You who earn $160,000, you are "the rich," too.

BobRob

No way am I voting for Obama. I am not going to punish those who worked hard and now have salaries that reflect that. How about getting rid of some people like Ted Kennedy who hides his money in trusts and doesn't pay taxes? As for some of your great money-saving ideas, I would ask the co-workers of someone biking to work every day how they feel about their sweaty coworker. And ask the single mom with three kids who has to get to day care if she can plop all the kids on a bike.

Teri O'Connor

This just burns me. My husband and I live in a suburb of Los Angeles, drive seven-year-old cars, buy clothes in thrift shops, don't have any sort of staff such as a housekeeper, gardener, tutor, etc. We make about $260,000 a year. We live a very nice life, but I would dare anyone to come to my house and tell me we're living rich. We finally splurged on a plasma TV, which I see in the homes of many lower income homes. I'm a Realtor, so I see a lot of how people live. We have three kids, two in college in New York City and Los Angeles, private schools where we did not qualify for one cent of financial aid. I am paying more than $80,000 this coming year in tuition and housing. $80,000! Again, no federal aid. We make too much money. What a joke.

And to the poster who said to stop whining, I'll stop when people who didn't plan well and don't make much and want the government to take care them stop whining. Until then, I'm going to shout from the rooftops that Obama should be stopped. Socialism has never worked, and why people keep trying is a whole other topic.

concerned

I make about $275,000 a year. I contribute regularly to the economy. I have one mansion, an apartment for mistresses, and a beach house. So I donate a lot toward real estate. I also fund the electronics industry generously since I bought three new high def TVs and two blu-ray disc players. I donate to the arts as well with my my Ralph Lauren clothing purchases. I can keep going if you want me to. I believe in investing in American businesses as well, so I drive a Hummer. I am also thinking about opening up some burger franchises to create jobs. Why should I be penalized when I donate so much?

John Kievlan

For those of you who say "we shouldn't be forced to support lazy and irresponsible people just because we worked hard"--stop for a minute. Think about what you're saying.

You are implying that you have what you have, because you worked hard. Let me ask a few pointed questions and see what you think of them.

1) Suppose you had been born in Bangladesh. You work hard and behave responsibly. Are you well off?

2) You are concerned about the falling writing and reading skills of American youth. You work extremely hard, dedicate yourself to the task, and become an English teacher for the good of the children. Are you well off?

3) Imagine that tomorrow, all the alleged "laziness gaps" disappear and magically all Americans start working equally hard. Does everyone make $250,000 a year?

4) You're a self-absorbed, arrogant loser who is convinced he's the greatest writer since Shakespeare but can't actually write a single comprehensible sentence. You spend all your time banging out nonsense at a typewriter and drinking beer, cultivating a "suffering writer" image, and passive-aggressively begging sympathy off everyone you meet. One day, sitting at your typewriter, you realize how you could change the key mechanism to make the keys easier to hit. Being clever, you patent the idea, sell it to a manufacturer, and party on the royalties the rest of your life. You're rich--but are you hard-working?

5) When you were in college, you had your wild days just like most of America. One day your friend asks you to get him a little marijuana and you do, also getting a small bag for yourself. On your way back to the dorm, you get pulled over, arrested, and convicted of intent to distribute controlled substances. Still, you work hard and save money, get your degree, and try to get a job. Unfortunately, because of your one moment of bad judgment, nobody will hire you. You end up working waiter jobs for the rest of your life and struggling to make ends meet. You're poor--were you lazy?

It seems like such a simple and elegant formula. Work hard, be rich. Lie around, be poor.

But in real life, it doesn't work like that. No, not even in America. Industriousness, while important, is a minor piece of the wealth formula. It is true that if you are lazy, you will very likely be less wealthy than you would have been otherwise. If you work hard, you will probably be richer than otherwise.

There are, however, many more factors than just that. Laziness doesn't guarantee poverty, nor industriousness wealth. And in every case, the reasons for an individual's wealth or poverty are much, much, more complex than simply how hard he or she worked.

In fact, those of you who make $250,000-plus per year owe your success largely to the hard work of the rest of us poor lazybones; if we did not work hard, the social infrastructure and commodities on which your lifestyle depends would not even exist.

Oh, and by the way: I work 60-plus hours a week; I am very intelligent; I have excellent prospects; and I own my own company. But for many reasons I make less than $50,000 a year at the moment. I'm lazy? I'm a loser who deserves to be poor, who deserves to not have health insurance or proper health care, who deserves to struggle every month just to pay rent? Who the hell do you think you are?

John Kievlan

Concerned: Please tell me you're being sarcastic.

Riley

So, I am decent at math, but you are whining because you are going to be taxed more on $260,000? You spend $80,000 on college; we're down to $180,000 now. Your cars are seven years old, so no car payments. You buy your clothes in the thrift shops, so I'm figuring a maximum of $10,000 per year to buy the whole family's wardrobe. Los Angeles is expensive. I'm guessing minimum of $8,000 a month house payment. Where are we? 180-10-20? $150,000 left over. Gas and groceries? Tops $1,000 a month on gas, $2,000 on groceries. Where are we now? $114,000? Sounds to me like you should be just fine. Oh wait, I forgot, splurged on a TV.

Susan

$250,000 does not make a person rich. It all depends on where you live. My soon-to-be husband and I make about $210,000 before taxes, and we still can't afford to buy a modest home (condo) in a decent neighborhood where we live.

J. S,

What happens when a person making between $250K and $500K loses significant extra income to taxes? Do they reduce the number of times they go out to eat or stay at a hotel or buy non-essentials? How does this affect the downstream incomes of people who no longer benefit from their business? Or they may continue to go out but spend less on discretionary spending like tipping waiters, hotel staff, valets, massage people, whatever. In the end, the not truly rich, but better off than average, person who earn this upper middle class income will spend less, resulting in those earning less, by result, earning even less.

Jim Lippard

Kartik is correct that studies have shown conservatives give more to charity than liberals, as reported in Arthur C. Brooks' book Who Really Cares (Basic Books, 2006) and in Michael Shermer's Scientific American column in November, 2006.

All of this discussion has focused on income rather than wealth--I think wealth is a better measure of whether someone is "rich" than income, for reasons many have given here. If you make $250,000 a year but have $500,000 in debt you're trying to pay off because you're at the beginning of a career in law or medicine, you are not (yet) rich. If you save, invest, and pay off your debt, you will become rich, but you aren't yet.

Ed Silicon Valley

Bottom line is that Obama wants to raise your taxes from 36% to 52% after you include the additional Social Security taxes (remove the current cap from $102,000). If you're self-employed, add another 6%.

Add state taxes in California of 9.6%, and you are past 60%. If this isn't socialism, then what is? Why go to work? I am not motivated. Oh I forgot, Obama is in a tax-free fund (Northern Municipal Money Market Fund). Hmm...

Joe

I honor those making more than $250,000 a year that are intelligent (not just book smart) people. They will not have an issue with the tax increase. It will only cut a little into retirement deposits. They live within their means and they already know how to invest in these conditions. They will be fine and would most likely rather see the dollar go back up, so they are willing to help the economy.

How can I say this? I earn a whole lot less, and if they increased my taxes by a few percentage points, I would not mind because the above applies to me as well. I want the money to go back up in value and if I now have to pay for it, so be it, part of life. The powers in charge have never made good decisions and history proves that.

This is where my calm leaves the room.

It is your fault if you are making $250,000 and saying, "I am crunched"? If you are working hard, why did you make the stupid move of living outside your means? The good life of luxury. Go mass media and ego, you win.

Same things apply to those that are making between $250,000 to $500,000 a year and are saying "I am crunched." All of you need to start reading more about better spending behaviors. There are tons of books out there and plenty of info on the net that cost nothing to read, once there.

Look at it this way. Everyone saying "Ill be crunched" cannot afford many things with cash (if you still have cash to fashion shop with or vacation with, you aren't crunching so shut up). They can only afford to pay for basic needs. If you're earning more than $250,000 and understand that first hand, shame on you. The difference between you and the under $250,000 earners is you will start to be crunched and those people under $250,000 have been squeezing since $2.50 per gallon gas, and it's only getting worse.

Moral for "crunchers" at more than $250,000: Change your lifestyle if you can't afford it. I am not expressing my political view as I have more to hear from both sides.

Lou

Folks, wealth is how much you keep, not how much you make. It's cash inflow vs. cash outflow. $250,000 a year is a lot of cash inflow, but if you have to drive a BMW, live in a rich neighborhood, and take exotic vacations each year, the $250,000 will dwindle in no time. Net, this answer will vary based on your lifestyle.

Dan

While my girlfriend and I combined make a bit over $200,000 a year, we did invest considerable time and money into our current positions. Oh, and we rich people don't own a house, have roommates, don't own cars, and live pretty modestly.

We both have graduate degrees that we got full time--$100,000 each in loans plus the opportunity cost of giving up two years work. We also have professional qualifications--a couple of years of spending most of our free time studying.

We work in finance, so while we make good money, we have far less job security than a school teacher. And yep, in 2001-2002, we both took temp jobs paying about $15 an hour when the markets crashed (on-campus recruiting wasn't that good in New York in the fall of 2001).

Retirement--sure, whatever we can fund ourselves.

So summing this all up, we have invested heavily in our future and taken on considerable risk, and our reward is to be told we are rich should pay even more? Fully loaded for time and money in, we would have been better off leaving high school and going to work for the MTA driving trains.

BEN

In the TV series, The Cosbys, one of Dr. Huxtable's children said to the father something to the effect of the following: " Aren't we rich since you are a doctor and mom is a lawyer?" to which Bill Cosby said something to the effect of "Let me tell you, rich is not having to get up in the morning to put your pants on and go to work."

Wealthy is the family dynasties that have lived off the interest earned in the trusts set up by grandfathers before the government taxed everyone to death. For all the bluster that the Warren Buffetts and Bill Gates of the world make about the need for raising taxes, they will have trusts, top notch planners and CPAs and lawyers to assure that much of their wealth will be passed on to their heirs. But I don't see them or the Hollywood types or Obama or any other "raise taxes" hypocrites writing an extra check to the IRS to pay down the debt. It is legal for the Kennedys or anyone else who would like to contribute more of their money to Uncle Sam--just put your check where your mouth is.

I am against raising taxes not because I don't believe that they can do good but because our Congress and executive branch have never learned how to balance the checkbook. They always find a new program to support and a reduction in the support of a program to a level less than inflation is always viewed by some as trying to cut out that program. Most families have to cut the fat in hard times such as now. Let us see the government lead by example, then talk in the future about raising taxes.

I also like the comment that if we really want to see all as equal, maybe some form of flat tax would help and then all people would vote to support or not support some of these programs that have gotten us into this mess.

Mark

Making a paltry $250,000 is not rich. Obama wants to penalize me for working hard, for sacrificing, for investing in myself, putting in the time and effort to go to college, then graduate school, and three more years and hundreds of hours of additional study to earn professional certifications in my field. I also put my wife through graduate school, and then through law school with two young children. Including the cost of my wife's schooling and my children's college educations, I will have paid more than $600,000 in after-tax dollars in education costs--with no help from the government because I am not eligible for government freebies.

I get hit with higher state taxes, the alternative minimum tax, and now you want me to pay even more of my hard-earned money to the government. Great.

People are responsible for the choices they make in life. Why should I be asked to subsidize others who are not willing to invest in themselves, take risks, and work as hard? After 30 years of hard work, last year my wife and I made more than $500,000, and I don't consider my self rich. Increase taxes, and you take away the incentive to work hard. At some point, you say: Why bother?

Reluctant New Yorker

I make almost $250,000 a year as a single woman, but by no means would I consider myself wealthy. Facing repayment of almost $200,000 in student loans (upon which I pay approximately 8% interest, none of which I can deduct because I make too much money) and the Manhattan cost of living, I have very little disposable income to speak of at the end of the day. I am also subject to high state (and city, for the love of God) taxes that my friends in other locales are lucky enough to escape. I can't afford to buy even a studio apartment in the city, since I live paycheck to paycheck and most buildings require substantial down payments (20% is common, and on a mortgage of $500,000, that's not chump change) and have minimum net worth requirements. Rates are also much higher on "jumbo" mortgages to make matters worse. OK, so I could move out of the city, but what seems to be an easy solution in theory is logistically impossible in practice for a single woman already working hours that require living on an inhumane amount of sleep and commuting at hours during which most means of mass transportation are not exactly safe to utilize alone. So, I'm stuck with the prospect of paying more than $2,000 a month in rent for a shoe box-sized apartment and no mortgage interest deduction for the foreseeable future. On top of that, my income level means that the benefit of almost every tax credit or deduction available is phased out or eliminated, but I'm worth more dead than alive. Considering I work 80-hour weeks, that's quite a depressing statement. I'm not saying people can't get by on this amount of money, because obviously it is possible. What I am saying is that my parents make half of what I do combined, and they made huge sacrifices to put me in a position where I could even get the education that I paid $200,000 for and resulted in me obtaining a position at a premier financial institution in New York. I live in a ridiculously expensive city, because that's where the best of the best in my business are, and for better or for worse I have to deal with it. However, to think I'm getting nailed with AMT and am going to face an even higher tax bill as a result of a system that ignores the cost of living I face is infuriating. Additionally, if I'm going to pay more taxes because I went to school for eight years and have this job, could I at least get a break for all of the student loan interest I'm paying? Thanks so much.

Emily

I agree that $250,000 annual income is not rich, but it is definitely, no matter where you live, upper middle class. No one thinks they're rich, and no one wants to pay more taxes. But you know what? Immigrants are getting by in the same area on incomes a tenth of that, and sending money home. To hear that $250,000 is "middle class at best" is deeply offensive and shows that people have lost touch with what poverty really is. Break even? Get in touch with reality. You can spend less. What you think are essentials are not.

And you know what would decrease expenses for everybody with proper funding? Universal health care and decent public schools. And what would decrease costs for the federal government? Ending the war in Iraq.

charles

John Kievlan: "Concerned: Please tell me you're being sarcastic."

Um, yah, I believe he is. Ok, here's another reason I am such a proponent of $250,000 a year isn't rich: For starters, my family lives in the thumb of Michigan, a very rural area (and mostly agricultural at that). We live in a house that isn't even worth $40,000, have a minivan that's worth about $3,000, my wife is the only one working, and she makes about $24,000 a year before deductions. I have been unemployed since April, 2007, my wife's 401 isn't even north of $25,000, and there are no other assets.

Now dig this: Last winter we ran into a problem with our heat (LP), so we went to the various government agencies to see if we could get some assistance, so we could get some LP.

Well, imagine our frustration and aggravation when we kept hearing that: "We make too much/have too much for assistance."
--Charles

ScottH

I agree with cutting spending--that is definitely the way to go. But suppose we were to revamp the tax system. It seems the fairest way to do that is to remove the Social Security tax limit, which is currently around $94,000 or so. Simply allow it to continue on all income. This may seem like a tax on the rich, but it is simply a tax on income--the more you make, the more you pay, but at the same rate. Someone making $250,000 is able to survive all throughout the year until they hit the $94,000 limit--then their income rises because the limit has been satisfied. If a no-limit Social Security tax were instituted, the Social Security system would not be in trouble today.

Jodie

Why should I pay for you? No one helped me when I was earning a lower income. No one gave me a check because I was poor. My mother worked three jobs to keep me fed and clothed when I was small. I went to school at night, living through 18-hour days over a period of 10 years, to increase my earnings to the point where I am comfortable.

Why should I pay extra tax to support people who go bowling or to the bar or whatever they do after work when all I do is try to improve myself? Don't have four brats if you cant afford them. Don't buy a house if you cannot afford the payments.

A flat tax is a great idea. Let everyone carry their own weight for a change in this country.

I don't mind paying for people who are not capable of supporting themselves. However, I draw the line at supporting the lazy or stupid.

Michael

If a person lives within his or her means there should be no reason someone making $250,000 per year cannot pay more taxes. My fiancée and I will make $175,000, and we are both good with paying an appropriate amount of taxes.

I don't see why a person making $30,000 a year has to pay the same tax percentage as someone making $250,000. That is just ridiculous.

Elliot

In my neck of the woods, $250,000 a year is a very high income, but regardless, whatever gets done with increasing taxes is only going to nibble at the margins of the deficit. It's time to bring our troops home to this country where they belong and to quit fighting unnecessary and unjust wars in countries where we have no business being in the first place. This country spends more on defense than any other country in the world, and all it is doing is bankrupting itself to keep profit margins high in the military industrial complex.

Scott

I'm OK with it, but the threshold amount ($250,000) should be indexed to rise with inflation every year rather than come back to haunt us like so much other tax legislation such as the AMT and marriage tax issues.

Broadly, if I'm in the top 2%, I can pay a bit more, and I am in that group, but don't try to hand me a line that this will be a huge boon to the Treasury. So few people earn at those levels that the increase is insignificant to the actual taxes collected. It's just a populist, Democratic theme--nothing more.

Amazed

You are not connected with realty if you think $250,000 is not rich--80% of the people do not make that much.

Dawn

Reading most of the comments on this subject, I see you all are complaining about Obama's wanting to tax couples making $250,000 a year. You all should get your taxes raised. The "change" is what you all voted for--Obama.

JB

It is all relative. This is clearly a stupid statement by Obama, and a statement made by a a man who is no longer middle class by any stretch. First, $250,000 is only relative based on your geographic location. If you make $250,000 in middle America, where the average income is $40,000 a year, then, yes, you are rich. However, if you are making $250,000 in Northern New Jersey, New York City, or Los Angeles, you are the working middle class, because everything is three times the cost of what it is everywhere else. If you are not making that kind of money, then you are not living. It is that simple. If you want wealth, buy real estate, and build wealth. If you want to make money, rent out your real estate, and let your tenants pay your mortgage. That's wealth.

I personally know people who make $250,000 to seven figures. There is a clear difference in how they live, what they buy, what their homes look like, etc.

Further, Obama is going to penalize those who have quite probably worked harder to earn that level of income. Hmmm, can you say socialist? How about smaller government? Whatever happened to that?

Jim

Only a couple people understand the real point in this list. Raising the cap will bring in more money, but it will not solve the problem. This is because very few Americans make that much. The only way to fix Social Security is to raise the age (that's political suicide) or raise the 6.2% to a higher amount. The amount of money received by doing what Sen. Obama is suggesting will not have an impact. It's insignificant. I'm voting for him, but this is the kind of stuff (like the removal of the gas tax) that he said he does not support.

Alan

Some people on here would say that it would be unfair if nobody had to pay taxes. Just think, if nobody had to pay taxes, we'd still hear whiners.

It's the government's fault that the government is retarded when it comes to spending money it never had to earn, but took instead.

You're a slave to the government, and they own you and your children, and you will never be free, so quit complaining.

If it isn't obvious, think about this: They seize about a third of your labor and can draft your children to die in their wars.

rgc

"But with costs rising fast, that hardly seems 'wealthy' now." Since when do rising costs make a person wealthy?

Jack

There may be reasons to avoid taxing the rich, but advances in prices that affect them as well as those with much less discretionary income isn't one of them.

Keeping taxes low for the rich as a means of stimulating the economy has never been proven to be reliably effective.

Both sides of that argument merely raise anecdotal arguments in support of their positions. All that can be said is that it works sometimes. By the same token, raising taxes of the rich doesn't always precipitate a recession.

Republicans take care of their own by reducing upper income taxes. And Democrats take care of some of their constituents by upping those taxes.

All that's fine, but I'd like evidence--not mere assertions or anecdotes--that a particular approach works.

Mike

The majority of the world does not have a standard of living as we do. When we talk about $250,000 being rich as a relative concept with regard to where we live in the United States, we should think about how much better the average American lives than the rest of the world. In fact, most people who consider themselves "poor" in the United States probably live a lot better than the majority of people in India or China.

Albert

Applying one set of expenses to anothers' income and not adjusting for the cost of living leads to an apples to oranges comparison. It sickens me to say it, but $250,000 isn't wealthy.

Where I grew up in Ohio, a city of 50,000, $250,000 was and is a "wealthy" income; I wouldn't mind paying an appropriate tax if I still lived there. But how many dual income households from the 2% live in these lower cost areas of the country?

Not many, because the jobs are in the expensive large metropolitan areas. My household, like many others, in trying to get ahead, moved to where these jobs are. Take the D.C. metropolitan area, where a two-bedroom home is more than half a million (starter homes are $300,000 apartment/condos), groceries and gas are out of control (especially if you have a 20-plus mile commute), and better schools cost real money plus funding retirement; we diligently watch every dollar, including those that go to the taxman.

Tony

My wife and I make more than $150,000 a year. In New York, believe me, that's not rich, especially after paying federal income tax and NYS income tax, which are obscenely high where I live on Long Island, NYS sales tax, state and federal gas taxes, and all the other add-on taxes for fuel oil to heat my home, taxes on the phone bill, which typically add 20% to the bill, etc. Obama needs a reality check. He plays the "I'm black" card, but he and his wife are part of the privileged class in America.

Steve

This is really about the majority soaking a minority. It really isn't fair to ask 98% of the people if they mind sticking it to the other 2%. The 2% are really being discriminated against. I am not in the 2% minority, but I hope to be one day. Therefore, Obama just lost my vote.

Arlo

If you want to make it fair, then you raise taxes for the so-called "rich," then raise taxes for the poor, too. It seems to me the easiest thing to do would be to tax everyone the same percent. That way "poor" people can see as much of their hard-earned money disappear as the "rich" people do.

Burntfinger

If Obama really wants to have more money, he could start by doing away with DHS. That ought to free up some money. Hell, if he did away with most of the security theater, maybe more people could spend their time making money rather than standing in line at airports and the deadheads who work for the TSA could get real jobs producing a real product or providing a real service.

Kerem

I am alarmed to see as many liberals here who'd rather buy into the notion that we can raise taxes, especially capital gains, and suffer no consequences. Do they understand who creates the jobs in this country? Oops, yes, I forgot. They would rather have Uncle Sam create jobs. This is all so socialistic that if they get their way, this country will suffer greatly. Whether $250,000 is rich or not is besides the point. The question is, are we going to sit back and have these people take our freedoms away? Yes, don't be fooled, overtaxation or confiscation of your hard-earned wealth as I call it, is the start of losing our freedoms.

Any fiscal conservative out there needs to persuade all the brainwashed, numbskulls supporting Obama out there to rethink their support for this Marxist. I am doing my part. As it is, McCain is not a great choice either, but at least he is a "conservative" in comparison.

money619

I think $250,000 a year would be considered wealthy if the person doesn't have student loans that are more than a $100,000.

Arthur

Obama is a populist in the worst sense of the word. Of course, his mouthpieces spin it differently when they are on CNBC.

Richard

My wife and I are public school teachers here in Anaheim, Calif., and we have a combined income of $151,000--$178,000 if you add in our taxable interest income. I was considering teaching summer school, but I will not do so because that will push me into the "rich" category.

mike

My parents are wealthy, whether you measure by income or by net worth. They certainly make $250K-plus. To get to that point, they spent 14 years combined in college (incurring substantial debt) and spent another fortune buying and starting businesses. They directly employ about a dozen people full time in multiple businesses, in addition to people in other businesses who have jobs because of their companies' business.

They didn't come from money. Neither set of grandparents ever made anything more than a working class income (one grandfather drove a truck, the other worked on an assembly line). What their parents did give them was the belief that they could be anything they wanted to be. By all accounts, my parents have lived the American dream.

Most Americans go to work and come home and forget about work. For the small business owners, who compose most of those in the wealthiest 2%, work follows them home. My father is a great dad, but the image of my family living room growing up includes my dad's open briefcase sitting on his lap as we watched TV or talked as a family. While his employees didn't invest in his business, went home, and forgot about work, and didn't spend nine years in college, he did. And all of them have jobs because of it. Those who take risks and make investments should expect to be able to reap the rewards of that.

Never forget that without an employee, the employer would still have a job, but without an employer, the employee would not.

It was Marx who said, "From each according to his ability, to each according to his need." That is exactly what Obama is proposing. It isn't the wealthiest 2% who don't have health insurance. But that is who Obama is asking to pay for health care for those who need it.

I have jokingly been telling some of my coworkers (yeah, I have a job, not because my family's financial situation necessitates it, but rather because my parents have instilled a work ethic that would make me feel lazy if I didn't work) that if that socialist wins, I think I'll quit school and move to Colorado and become a ski bum. Because the government will provide. Or maybe I'll go find a country that actually believes in free markets (I actually anticipate some expatriation by some wealthy Americans).

The fact that "they can afford it" is irrelevant. I don't dispute that they can afford it. But Robin Hood economics are still wrong. Socialist speak is popular--most people hate their boss who "makes too much money." Oppression by the majority (the 98% who don't make more than $250,000) against a minority (even if it is an advantaged minority) is still wrong.

Obama often says that we are each our brother's keeper. However, what Obama advocates is that the government is your brother's keeper. In the Obama tax plan, individuals have no moral responsibility--the government takes care of it. Moral justification is collective, not individual. Wealthy Americans certainly have an individual moral obligation to help the poor. But we should not confuse individual responsibilities with government compulsion.

Tom

I am a state government employee. (Take a moment to savor all the prejudicial baggage that entails). And my salary is $60,445 after 38 years preceded by four years of college that was not paid for by my parents. My job requires me to work days, nights, weekends, and holidays, and this week I had to work 52 hours without overtime pay, working from 4 p.m. to sunrise twice last week.

I live in what was once an economical region of my state, which has become one of the highest cost of living areas in the country. The only things saving me financially is that I was able to buy my 1,800-square-foot townhouse a long time ago, drive an old diesel powered Volkswagon, and am under a pension plan.

I believe that where you live determines your wealth as much as how much you earn. State employees with my exact same job, but in a different part of the state, live like kings compared to me. They send their kids to private school and vacation overseas.

I also believe that your "current" income--and your income per se--is a poor determinant of wealth. I know for an absolute fact that in my location, a welfare mother with two children, who does not work, has a lifestyle that would require a $50,000 annual income to support. I also know individuals who can write off expenses for a Mercedes that exceed what it would cost for a single-parent mother, such a highly educated registered nurse who has to work two jobs, to own and operate a Toyota Corolla.

I know of middle class families making what I make who are horribly in debt: Auto expenses, day care, home repairs, and copayments on medical care will drive a family in my income bracket into debt. I know young people in my field who cannot afford to live in a tiny apartment and pay their student loans without working two jobs or living with a roommate.

My only extravagance is that I raised four children, and had little time for them during the 17 years I had to work a second jobs to support them. My wife is on disability, her Social Security mostly eaten up by copayments on medications and copayments for twice weekly medical appointments.

$250,000 looks pretty good to me right now. Taxes and all.

BIGWEEDS

I believe that a Democrat never has met a dollar that he did not want to tax.

Pam

While $250,000 may not be "wealthy," it is certainly a lot more than most of us have. Raising three children on an $80,000 income is a lot different from raising one on $250,000. Just because some people are not lawyers or doctors does not mean they should shoulder the majority of the taxes, as the middle class currently does.

And if someone with $250,000-plus income is "hurting," then perhaps they should look into getting a smaller mortgage as the rest of us are often encouraged to do by the financial columnists and contribute a smaller percentage to retirement than they would like to. (I have to struggle to contribute 10%, and I don't notice anyone feeling sorry for me.)

The point to me is not that we hate people who are well off, but that they are in a better position to pay more taxes and not be significantly harmed by it. Since I work for a law firm (but not as a lawyer), I am well aware of what sort of lifestyles people who make $250,000 and more have.

Serd

$250,000 per year is relative income.

For someone used to raising three kids on $40,000, $250,000 would be obscene luxury. To someone making $2 million, $250,000 is a pittance. And to someone who is used to making $250,000, it is only so-so...cause we tend to spend what we make. And in today's America, we tend to spend more than what we make no matter what that is.

So the people who are crying foul about $250,000 not being enough have a point when they say they must save for college for their kids, because they won't qualify for government loans. They have a point when they say that they have to save more to have an equivalent lifestyle in retirement.

But the person who is struggling to put gas in their car to go to work has little sympathy for the one who has to cut back on their Starbucks lattes to meet their financial goals.

Debt becomes a factor as well. If you are making $250,000 but have $80,000 in debt, don't expect people who are struggling to pay $5,000 in debt to sympathize. It's time we all start to look at what is best for everyone... not just me.

So when small business owners have their income because of putting others to work, they should get credit for that versus the person who simply has a job making that much income.

If the person who spent $100,000 to go to school to make the $250,000 income would be realistic about their spending--and live like the rest of us for a little while longer, they'd knock out that debt in no time.

The bottom line is that the vast majority of government spending is not cuttable unless you want to strip those on Medicare and Medicaid and Social Security of their lifelines. Between those costs and the debt payments, we're left with the military budget (even if the troops come home, we need to spend that to shore up our failing infrastructure).

So what needs to be done is to figure out what kind of tax policy will cause the most boats to rise and bring prosperity for the most people. If providing tax relief for people making $50,000 will spur the economy such that those making $250,000 can afford the tax increases, then that is all good.

In order to get to a rational point in tax policy, we have to all be willing to make some sacrifice for the common good. It can't be every man for himself, because we're interdependent.

eduardo Lerro

I live in Manhattan. $250,000 for a couple would not even be enough income to secure a loan for a one-bedroom apartment in a bad part of Manhattan. And you can forget sending your kids to school there. So, add $30,000 per year per kid for an average, not elite, city private school. $250,000 for two people is basically not even upper middle class in New York, Los Angeles, or San Francisco. Income is very, very relative. I myself earn just under $100,000 and have an Ivy League education, and I can literally barely survive in Manhattan. $250,000 is not rich. Democrats need to stop raising taxes. This kind of talk is alienating and divisive.

dcgirl

$250,000 may be wealthy if you live in a place with a low cost of living, but when you have some homes in various areas costing more than $500,000 for 1,100 square feet (if you're lucky), then $250,000 doesn't go very far. You also have to consider the local taxes.

And when are the liberals going to learn that when you raise the tax rate, the government receives less in taxes? Reagan proved that point.

The only bright side is that if Obama gets elected, it will be as bad or worse as when we had that idiot/traitor Carter and then maybe everyone will see the light that the government cannot be a nanny state. Self-sufficiency needs to be brought back. I guess we may have to get to the bottom (Obama) before we can begin to climb up again. Maybe an Obama disastrous presidency would produce another Reagan for us.

donzelion

Is $250,000 "wealthy"? Wealth is relative to expenditures. Better question: How shall we spend our money? Eliminate government spending? Sure, which schools will you close? Which elderly will you throw on the streets? Which sick people will be sentenced to death? Which prisons will you close? How much of the military will you shut down?

We have three choices:
(1) Bite the bullet and say who is going to suffer.
(2) Raise taxes on somebody.
(3) Lie (and/or blame others for making the problem).

Of course, most people prefer option (3). Works well for politics, but doesn't fix the problem.

drextraction32

The tax question is largely subjective depending on your earning prowess. I believe all Americans are taxed at excessive levels and not just on incomes but also on property, vehicles, fuel, sales, and so on. The primary problem is an ever-expanding government that has an unquenchable thirst for spending money. The government needs to be reduced drastically; there is so much waste it can't even be quantified. Go to any government agency and watch the employees there doing absolutely nothing, reading the newspaper, filing their nails, waiting to retire at 50 and continue collecting their paychecks. It's enough to make you vomit. Raising taxes will not fix the problem. Vast tracts of government agencies need to be shut down. No one will miss them, especially the taxpayers.

Give me Liberty

$250,000 is not rich if you define rich as having more income than you need. Just like having $2 million (the estate tax exemption) is not rich.

Figure it out: If you live in a large city (which are all mostly Democrat) and you and your wife make $250,000 (in Chicago, where I live, that is a manager in a public works department and a nurse, both of whom work 55 to up to 70 hours per week), take out parochial school education (schools suck here) and commuting expenses, 401(k), health insurance, FICA and payroll taxes, and you're lucky to get $5,000 to $7,000 per month. Then, take out a mortgage on a middle class house ($350,000 to $500,000), home and car insurance, home maintenance, clothing and food, and you're tapped. You live better than most people, but you can hardly rest easy about your kids going to college or your retiring. So $250,000 is comfortable in this country unless you're some geezer lawyer or professor still working at 70, living in an empty nest, and getting Social Security and free medical care from the government.

Michelle

Wow, if anything it's the wealthy 2% that seem to be the whiners here. "If you raise my taxes" (which let's face it, with your write-offs and tax caps you are not paying an equal amount in taxes--some pay nothing in taxes, because they're capped at a certain dollar amount) "I can't pay for my kids' private schools because public schools suck" (my kids attend public school) and "you're poor because you're couch potatoes." The fact is that those of us earning $36k a year are likely working twice as many hours as you, twice as hard as you; many of us have college educations, too, by the way, and while you can't afford to pay for your kids' private schools, your new cars (we're driving the same car we got used in 2004, if we have a car at all), even purchasing private health insurance (I sold insurance--don't cry to me about paying for it. Even on the more expensive end for a family of four at $600 a month, it is nothing if you're making even $94k a year--many of us have to pay the same thing making 1/3 of that). You sound like spoiled little brats, but we're not talking about taxing those who make $94k or even $150k.

Let me give you the real picture. The average income being in the $48k range--these are educated, hard working individuals (even those at $36k), and $48k is $923 a week before taxes. We're paying taxes; don't think for a minute we're not. But then you have a $1,500 a month mortgage (that's almost half the monthly income after taxes), a $500 power bill in the cold winter months, a gas bill commuting to and from work each month of $250-plus a month, (now we're working with a surplus of only $750 a month), $250 a month for insurance (on the conservative side for medical, dental, auto, homeowners)--if you have a car payment, that's likely half that surplus, add in food, phone, school expenses (books, clothes, classroom supplies, fees), and all the little mundane costs, and there is nothing left to invest let alone put away for a few months of cushion. Whatever little you've put away inevitably needs to be used (and has been) for car repairs, a major medical emergency (even with insurance, it doesn't cover all of it), or home repairs.

We bust our asses every month, rarely taking vacations (because we can't afford them), working hard every day just to keep afloat, and then you come along call us lazy and cry poor about taxing your $250k a year and don't think they should pay taxes? We have the same basic expenses that you do, and we go without most of the luxuries that you cry about it. Talking about traveling abroad? Of course, we're not traveling abroad. We're only making enough to travel up the road and never getting ahead. Not because we aren't working hard for it but because we're stuck underneath a horrible economy, rising interest rates, and rising costs. You, the people who make this much money, are the ones not working. You are the ones making the money off our sweat (credit card companies, financial institutions, oil companies, medical professionals, insurance companies and other corporate blood suckers causing the costs to go up). You're not working hard--you're picking the bones of the working class to get rich.

DKu

To say "$250k a year is rich" and not qualify the statement geographically is like saying, "People in Indonesia live on $100 a month." By that notion, anyone making $30k a year is rich.

William Wallace

To Michelle making $36k a year: Last year I made a little over $250k and paid about $80k in taxes. Did you pay $11k in taxes? Then we're the same. Think you work harder than me? I have five software jobs as an independent contractor, my last vacation was in 2005, and I live in a 900-square-foot one-bedroom condo. Because I choose to live within walking distance to work (as it's better for the environment, among other things), my monthly mortgage exceeds $6k. My mortgage is high simply because I overpaid two years ago (costs were driven up by people making $50k buying $750k houses). My folks paid for my bachelor's degree in engineering 15 years ago and I paid for my master's in computer science without assistance or loans. These days, I work six to seven days a week, usually go to sleep around 3 or 4 am and wake around 8 am. If you're working twice my hours, that's about 160 hrs/week. If that's true, then I hope you don't have any kids or family or significant other (neither do I). I also hope you're not an air traffic controller. From 1997 to 2005 I moved between the east and west coasts five times to seek better jobs. Why do all this? Because I actually like what I do and like my work (I'm weird, I know). But don't punish me for it. I also know that I need to work as much as I possibly can now, because when I'm 65, I will have no one--no one--assisting me. No social security, no pension, no rich aunt. That and in about five years my knowledge of the software industry will be obsolete. Now I realize there are people less fortunate than me, and so I'm willing to contribute my share. But don't think for a minute that I don't work as hard or sacrifice as much as you do.

Craig

It is funny that the more money you make the more it costs to live. I remember when I first graduated from college and was making $22,000, I thought, if I only could make $35,000 per year I would be set. Five years later I was making $50,000, and I had a house and a car and I thought if I could only make $75,000 I would be set.

Five years after, that I was making $100,000 and I got married, boosting our total income to about $160,000 and I then had a bigger house, two cars, four yearly vacations, and a kid. Now I guess I will be set at $200,000.

I bring this up, because there is one truism in American life. Being upper middle class in America is an expensive proposition, especially on the coasts. We can live with less, and may have to, but it will not be easy.

Just because they are choices doesn't mean they are easy choices. Making $250,000 and having to send your kids to crummy schools and making your own lunch kind of stinks.

KG

I am a medical laboratory technician. I am one of those who: cross-matchs the blood you receive, performs and interprets the lab tests for the doctors, and even performs maintenance and occasional repairs on laboratory instruments.
I work full-time.
I pay for my own full-time college education (returned for an additional bachelor's degree).
I pay my mortgage
I pay my car payment.
I donate to charity when possible.
I do not get to take vacations every year.
I do not get to eat out on a regular basis.
My gross income is less than $50,000 per year.
I am outside Dallas/Fort Worth in Texas, and the cost of living is lower than some areas of the country.
Even if somebody is living in an area with a higher cost of living, I can't believe that somebody pulling in $200,000 or more per year is struggling.

BJS

Many politicians want equality in every aspect of our lives except taxes. Why is that? There seems always to be a magic cut off where someone is considered rich and the others, well not rich. Yes, even the poorest in this country is wealthy when compared to poverty on a global level. I think politicians should cut spending in Washington buying constituents' votes with earmarks, etc. It is not a Republican or Democratic issue; it is a spending issue. If the government abided by the laws it subjugates the rest of us to, most of them would be in the plight of a Bernie Ebbers or Enron executive. There is no accountability in Washington, and we keep sending the same people up there to represent us--I mean their donors and supporters. The taxpayer is forgotten in all this hubbub. Time to vote all the idiots out. Before raising anyone's taxes, let us cut spending. That would be novel. What is wealth? It is the guy who has a big trust set up by earlier generations. It is the do-gooder politician who goes to Washington and collects from supporters and lobbyist until they are millionaires. And then the people who earn it--the Bill Gates of the world. Though I am not a Microsoft fan, a Bill Gates provides thousands of jobs and money for the economy, more than the government that redistributes.

As an aside, look at the number of Senators who are millionaires. It is the majority.

Bill

First off, whether or not you are "wealthy" depends on how much wealth you have, not your income. There's obviously some correlation, though. How rich the $250K household is kind of depends on how they got there. A pair of fiftysomething professionals who spent their twenties getting PhDs could easily make that, but they are by no means rich. Especially when you consider they probably have kids in college and have to make up for their late start on retirement savings. A pair of twentysomething lawyers on the other hand? Even if you have $200K in school loans, you can pay that off pretty quick on $125,000 a year. And even with high living costs plus the loans, you may not be rich now, but you will be. Also worth considering is whether you were able to buy a house pre-boom. Housing in the Washington area tripled in 10 years. If you got in ahead of that and bought an average house there, despite the recent pullback, you'd have the median household wealth (about $150K) with no taxes due even if you didn't lay out a dime for a down payment on the thing.

Now as far as whether raising taxes on $250K households is fair or not, you have to judge whether the system as it stands now is fair. Due to the Social Security cap, low rates on capital gains, and numerous tax breaks for housing (which disproportionately benefit those with high incomes), I would say it isn't. In my opinion, get rid of all the write offs, except legitimate business ones, and institute a progressive code from 20% to maybe 45% maximum. Include Social Security and Medicare (both employer and employee parts) in that rate structure. Many of us in the middle class are already paying a about 45% top marginal rate when you consider all that stuff, so to expect a household making $250K-plus to pay that is not unreasonable. Also, tax capital gains and dividends at the same rate as ordinary income, but allow dividends to be written off on the corporate income tax.

Jones

Where are the wealthy planning on escaping to--once this country is so messed up that it is unsalvageable? That's what I'd like to know. Someplace where government can start from scratch and decisions will be made that are for the good of society. A place where entitlements do not define and determine work ethic. I figure Switzerland is getting full...

Krista

The real question that we need to come to terms with is not what defines "rich," but what do we think America is and should be. Do we want a country where you can get an education, work hard, and pull yourself from poverty into wealth? Do we want a land of opportunity and the ability to move between classes? Or do we want a country where you can really only have money if you are born into it? Because no matter how high we make tax rates, the poor are never going to be rich from government handouts. We should improve education and make sure that everyone has the opportunity to make something of their lives if they work hard and smart--but to suggest that government handouts are a good strategy for a country ignores the countless lessons of history. Socialism doesn't make productive societies. I think we have forgotten what made America the great country that it is. I am an immigrant, and I make way more than $250,000 a year. I was raised in poverty. I know firsthand what makes this country so special. I worry that Obama doesn't believe in the America in which I believe--the land of opportunity--not the land of government handouts.

Antoinette Rodriguez

I love the comment from the person who said $700K would buy you a nice "house" in New York City. If you know anything about the city at all, you would know that $700K essentially buys you a 1-bedroom or possibly a 600-square-foot studio apartment if you have the six figure down payment (double the figure because you have to pay significant taxes on it) and closing costs. Add on another $2K or so for taxes and monthly maintenance fees. Further, with the now remaining $3K or so per month "left over," you could essentially have one child (paying most of that for child care the first few years), get yourself to and from work (by train preferred), eat in almost every day, and if you're lucky, take a two-week vacation during the year. We make more than $250K per year and are seriously considering not having another child, because we can't afford the step up of attempting to buy another apartment with an extra bedroom. Our child doesn't have her own bedroom now, but we understand that we've traded space for the cultural and ethnic diversity riches the city has to offer. We also live in the city to be closer to her and not lose valuable time that we would prefer spending with her on a daily basis. These are our decisions and we're not asking for pity, but you really do need perspective on this. And for those morons who state "high earners" should take their high salaries and move out of the expensive cities, note that the high income is dependent on proximity to the cities. We both have master's degrees, took on heavy student loans, work 60-plus hours per week each our entire working lives, and neither of us came from wealth (my family barely had food to eat growing up). I own my own business--created through the blood, sweat, and tears of risk, savings, and many times, extremely long work hours. This country is not a socialist one, thank goodness. If you recognize the basic fact that businesses create jobs and that taxing people more never results in more incentive to do well, you would dismiss some of these financially irresponsible proposals. Robin Hood only works in the movies. These tax and spend scenarios didn't work in Cuba, Russia, and many of the European countries who suffer from poor productivity. Government should spend less (gasp--within its budget) and instead of those idiotic one-time rebates or bailing out irresponsible people who bought homes they couldn't afford, focus on expanding capital access to small- to medium-sized businesses--who, after all, create most of the jobs and subsequent opportunities in this country.

James Jameson

Just because you make a lot of money doesn't mean you are harder working, or better in any other way than the next man. Thinking that way is elitism, plain and simple.

dnno1

The fact of the matter is that the average salary nationally is less than $36,000 a year--well under $250,000 a year (just check the figures at the U.S. Bureau of Labor and Statistics). There are not that many people making more than $250,000 a year and above. If you are making that much and are still complaining about struggling, you are obviously living way beyond your means. There are millions of other folks who make half as much and are somewhat satisfied.

molefed

While I recognize that $250,000 is considered rich in parts of our country, that is not the case everywhere. Most people live near their work, and that is partially what dictates housing prices. A real scenario: In the Silicon Valley of California, there are a lot of jobs for people who have worked hard to gain a higher education and get a good job. As a result, there are a lot of people looking for housing in this area and that has driven up house prices to the point that a dual-income family (earning just over $250K), paying for two children in childcare, saving for kids' college educations, and just trying to get by--is forced to try and pay $1 million for an under-1,200-square-foot "starter" house. So, on top of all the other expenses, now these dual earners have a huge mortgage to pay. It is unrealistic to think if we tax these hard-working people even more, they will not feel the financial pain. I have read the comments about living beyond your means if you make this much money or you should move. But the reality in some parts of the country is that is just not an option.

Mike

And according to gaffe machine Joe Biden, we can be patriotic by paying more taxes. Someone asked, can't I just wave my flag?

Sy Rifkin

The problem with the Obama formula for funding Social Security is a failure to recognize the source of wealth. The payroll tax does not harm the "wealthy." The salary of the CEO is not large. The non-salaried portion of their compensation (stock options, golden parachutes, etc.).

The wealthiest Americans derive their wealth from stocks, bonds, and real estate--and not from payroll. The amount that would he raised by an increase in payroll tax imposed upon those who earn $250,000-plus would not be adequate to solve the problem.

matt

What insanity. The reason we need more tax money is the government is hungry. We must feed this huge animal.

Renesha

Here in Bermuda the average wage for high school graduates is $35,000 a year and above. So further down the line, if am making $250,000, that's mostly an excellent wage for middle class living, which I consider very wealthy.

The President of FOREVER

Whoa. If $250,000 a year isn't wealthy, then I am dirt, dirt, dirt, dirt, dirt poor.

joe

My wife and I have a combined annual adjusted gross income more than $250,000. We have two daughters under the age of 4, live in a 2,000-square-foot home, and have two cars (non-SUVs, 8 and 5 years old--mid-priced sedans). We take great effort to live beneath our means so we can save for our daughters' education and for our retirement. I would not consider us to be rich by any extent of the imagination. Both of us are first generation college graduates and paid off a significant amount of educational loans. I can tell you that if taxes are raised on us, we will continue to fund our retirement and savings plans, but will cut back on the spending we do right now--going to a restaurant from once a week to zero; buying clothes for my daughters from craigslist.com in lieu of Target or other stores; delaying a car purchase for another 2 to 3 years, etc. This will hurt the economy.

Larry Dallas

Pretty scary the way our potential leadership plays with people's emotions rather than facts. If you took the additional tax revenue to be achieved for all families that make between $250,000 and $1,000,000 annually, the additional tax revenue does not amount to a hill of beans in the greater scheme of things and does not solve our problems.

Angela

Someone forgot to mention that $80K is what people who make $250K a year pay per year in income taxes (FICA, Social Security, et. al.) That is a hell of a lot of money.

Al

My wife and I both work full time. In my "spare time" I buy, repair, and update old houses (fixers). This added income puts me into the $250,000 bracket. Obama will increase my taxes. If I fix up a house and rent it for two or more years, I can claim it as long term capital gains. Obama will increase the capital gains taxes from 15% to 28%. Guess what? There will no longer be an incentive for me to work those extra hours. I will not spend the 30 to 50 thousand of dollars at Home Depot that I currently spend. I will not spend the one to two thousand dollars buying plants at the local nursery.

I will also have less money to spend for dining out, for travel, for luxury items, for toys and clothing for my grandchildren.
I have four grandchildren to whom I would like to leave my estate. Obama wants them to pay the government before they can have any benefit from my life’s work.

So tell me, where is the incentive to work, to produce, to excel? It seems that Kurt Vonnegut’s “Harrison Bergeron”--the story of the Handicapper General will come true 72 years early. Only the Handicapper General will not be Diana Moon Glampers, but Barack Obama.

Skeptical

If you live in Manhattan, N.Y., where a condo can costs millions of dollars, or a decent house 1.5 hours away is more than a $1million, you cannot afford a home on a $250,000 or even a $300,000 salary. I guess according to Obama I am wealthy. I drive a Hyundai and cannot afford a home, because I do not have enough money saved for a responsible 20% down payment. I rent. My yearly vacation consists of staying at my parents' house. I donate 10% of my income to charity. My child support payments are not tax deductible. Now compare that to places in the country in the middle of Wyoming or Minnesota where $75,000 makes you the wealthiest person in town. I guess I should move somewhere cheap and take a $60,000 job where a home costs $125,000. Big cities are going to hurt because many professionals will move away to avoid making too much money and move to an affordable area. Remember they cannot tax you at that rate if you purposefully take a pay cut. Good for our economy and our cities. Not. It is socialism.

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