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This ^ plus tax anyone who is productive and has a high income into submission. That way they will give up trying to succeed...
Do you think the tax rates should be lowered? Raised? Or are they just perfect exactly where they are now, no room for improvement? Can taxes be adjusted without "high income", "productive" individuals giving up and walking away? Did those same folks simply "give up" when tax rates were higher, in the 1990's? Is there any evidence that raising the capital gains tax for 2013 on joint filers with more than $450,000 in unearned income, result in such a change in their financial behavior?
In other words, can you support your position with facts?
The question that should be asked is "why is $12/hr not enough?"
Do I really need to spell this out for you? Okay, here goes:
If you're making $12/hour and work 40 hours a week, that's $480/week before taxes. Let's assume that 25% of your paycheck is taken out because of taxes or other deductions. That will give you about $360 a week, $720 every two weeks, and about $1500 a month (rounding up).
You have to pay rent. If you're lucky, this is maybe $500/month. But it could be higher in some cities.
So if you have an apartment, you have utility bills to pay as well. Electricity, water and gas--unless you want to use candles every night and bathe in rainwater. A very conservative estimate for this would be $100/month.
If you can't rely on public transportation, you need a car. Cars need insurance and gas. And even if you buy a small car (Toyota Yaris/Chevy Aveo/Hyundai Accent/etc.), you will probably have to make monthly payments on it. So let's assume you sink $300/month into you car. Of course, you could get a used car too, but used cars are often of questionable reliability and may require expensive maintenance.
You gotta eat, right? I'm not talking about steak and sushi, but rather basic staple foods like rice, vegetables, and beans. This will probably cost about $100 a month per person. Or do you expect people to eat tomato soup and ramen noodles four nights a week, thus increasingly the likelihood that they will need medical care in the future for their unbalanced diets?
So now we've spent $1000. Where does the remaining $500 go?
If you have a child, you probably have to pay for monthly daycare. And if your child is a baby, throw in baby formula, diapers and medical checkups. Or are we not supposed to take our infant children to the doctor to receive necessary vaccinations? And if the child is older, you have to buy school supplies and more expensive clothing (not designer clothes, but a basic pair of blue jeans and a coat, for example). Daycare and babysitting expenses vary wildly. I'd estimate a very conservative price of $300/month.
If you went to college, you likely have student loans. I'll estimate that at $200.
Cable TV service might be a luxury, but phone service is not. Whether you have a landline or a cell phone, let's estimate $40/month here.
Internet service used to be a luxury, but it's becoming more of a necessity--especially since public libraries are often targets for reducing funding. Let's estimate another $40/month here.
I'm forgetting something. Oh wait! What happens if you get sick? If you have health insurance, you are probably having the premiums deducted from your paycheck. So let's estimate that at $75 for a really cheap plan. But if you get sick and go to the ER or primary care doctor, you have to deal with copays, deductibles and the cost of prescription drugs. There's no way to put a price tag on this, but if you have to go to the doctor, it can get pricey fast.
...and of course, if you don't have health insurance at all, going to the ER is always "free!" So that makes everything more expensive for everyone else.
We also have incidental/nonfood expenses, such as computer paper, printer ink cartridges, parking meters/tickets, oil changes/tire rotations, laundry detergent, etc.
By this point, we've likely run out of money.
At the same time, we're supposed to put away money for retirement or put money aside so we can have a 6-month emergency fund. Or we're supposed to go back to school and take night classes even though we don't have the money to afford the tuition or added student loan payments. Then we get in an at-fault car accident or have an emergency medical problem or are saddled with an $800 car repair bill.
I don't think I listed anything exorbitant in these figures. No vacations. No designer clothes. No dining out. No fancy tech gadgets. But for many people, they are just one disaster away from financial ruin. They are like hamsters in a wheel barely keeping their heads above water. They are too busy trying to survive to care about the guy making $150,000 or more.
It's a hard life to break out of. Yeah, some people do manage to get out of these circumstances through their own "hard work." But a lot of people "work hard" every day and are trapped in poverty or near-poverty. The system is not stacked in favor of people who are the most at risk.
Some suggestions:
1-No big houses.
2-No big cars.
3-No foreign adventures.
4-Curtail wastage.
5-Domestic peace.
If the highest paid employees in a company could only make a certain percentage higher than the lowest paid employees. Lowest paid worker makes $17,500/year, then maybe the President/CEO could only make twenty times that ($350,000/year). Vice President slightly less, maybe 15 times the lowest earner, and so on down the ladder. And no stock options to circumvent the system.
The idea that the lowest paid workers are all lazy and uneducated is wrong. There are a lot of very hard working people who are not fairly compensated, and many people go to college who end up having to work low paying jobs because opportunities are not out there. Millions and millions of jobs have been outsourced, and that's just during the Obama administration. Add that to the 10's of millions of jobs lost over the past couple decades prior to Obama becoming president due to outsourcing, then any rational, fair minded person should be able to understand the plight of the American worker.
Every job is important, but way too much compensation goes to those at the top and way too little goes to lower level workers. And that is where TRUE income redistribution lives.
Keep in mind also, while people talk about how important education is, there'll always be a greater need for lower level employees to get the actual work done, compared to how many executive and managerial jobs are available. Not that I don't think education isn't important, because I do, but the reality is lower paid jobs will always heavily outnumber higher paid ones.
And for those who defend huge wage disparity in this country, don't try to paint those who want more fairness as saying it's just class envy. No one is saying an office clerk should make as much as a CEO, they just want a fair wage they can live on. And that's not happening today in our country. The two parties in charge now better wake up, because one of these days a viable third party will be created and emerge as a very popular party capable of wiping out both the D's and R's.
Some suggestions:
1-No big houses.
2-No big cars.
3-No foreign adventures.
4-Curtail wastage.
5-Domestic peace.
Well, I suppose you could pay people with no education and no ambition to improve themselves, $50 a hour. But I hardly think that would be a sensible approach.
The only idea that I would be good with would be to offer free community college education. That way, people can get a start on some kind of education which will (hopefully) ultimately lead to better opportunities.
Of course, you have to pry them away from "The Maury Povich Show" and "Oprah" long enough to go to class, which could be an challenge.
Maybe toss in "free lunch" with that "free" college education -- cuz we know how grads are finding jobs now!! hum....
(well, at least it keeps some out of the workforce for a bit)
The rich/poor gap will go away --- as soon as you get over it.
Do I really need to spell this out for you? Okay, here goes:
If you're making $12/hour and work 40 hours a week, that's $480/week before taxes. Let's assume that 25% of your paycheck is taken out because of taxes or other deductions. That will give you about $360 a week, $720 every two weeks, and about $1500 a month (rounding up).
40 hours a week @ $12 an hour gives you $24,960/yr. At $24,960 you would pay $1800 in federal tax and $1859 in FICA tax - if you are self employed the FICA tax is $3719. Your effective federal tax rate is 7.2% or 14.65% if you combine all taxes.
Your NET income for the year is $21,300 or $1775 a month.
Quote:
Originally Posted by mazerunner
You have to pay rent. If you're lucky, this is maybe $500/month. But it could be higher in some cities.
So if you have an apartment, you have utility bills to pay as well. Electricity, water and gas--unless you want to use candles every night and bathe in rainwater. A very conservative estimate for this would be $100/month.
If you can't rely on public transportation, you need a car. Cars need insurance and gas. And even if you buy a small car (Toyota Yaris/Chevy Aveo/Hyundai Accent/etc.), you will probably have to make monthly payments on it. So let's assume you sink $300/month into you car. Of course, you could get a used car too, but used cars are often of questionable reliability and may require expensive maintenance.
You gotta eat, right? I'm not talking about steak and sushi, but rather basic staple foods like rice, vegetables, and beans. This will probably cost about $100 a month per person. Or do you expect people to eat tomato soup and ramen noodles four nights a week, thus increasingly the likelihood that they will need medical care in the future for their unbalanced diets?
So now we've spent $1000. Where does the remaining $500 go?
If you have a child, you probably have to pay for monthly daycare. And if your child is a baby, throw in baby formula, diapers and medical checkups. Or are we not supposed to take our infant children to the doctor to receive necessary vaccinations? And if the child is older, you have to buy school supplies and more expensive clothing (not designer clothes, but a basic pair of blue jeans and a coat, for example). Daycare and babysitting expenses vary wildly. I'd estimate a very conservative price of $300/month.
A child? Let's try and assume people won't live beyond their means. If the person in your example had a kid their tax would be lower and might even be eligible for a refundable credit.
Quote:
Originally Posted by mazerunner
If you went to college, you likely have student loans. I'll estimate that at $200.
The average starting salary for a college graduate is about $45,000.
Quote:
Originally Posted by mazerunner
I'm forgetting something. Oh wait! What happens if you get sick? If you have health insurance, you are probably having the premiums deducted from your paycheck. So let's estimate that at $75 for a really cheap plan. But if you get sick and go to the ER or primary care doctor, you have to deal with copays, deductibles and the cost of prescription drugs. There's no way to put a price tag on this, but if you have to go to the doctor, it can get pricey fast.
Young people don't get sick very often.
Vitamin C usually takes care of practically any illness.
Then, there is Obamacare.
Quote:
Originally Posted by mazerunner
...and of course, if you don't have health insurance at all, going to the ER is always "free!" So that makes everything more expensive for everyone else.
A Dr visit is around $100 + labs.
Quote:
Originally Posted by mazerunner
We also have incidental/nonfood expenses, such as computer paper, printer ink cartridges, parking meters/tickets, oil changes/tire rotations, laundry detergent, etc.
By this point, we've likely run out of money.
Only because the person in your example was living beyond their means.
Quote:
Originally Posted by mazerunner
At the same time, we're supposed to put away money for retirement or put money aside so we can have a 6-month emergency fund. Or we're supposed to go back to school and take night classes even though we don't have the money to afford the tuition or added student loan payments. Then we get in an at-fault car accident or have an emergency medical problem or are saddled with an $800 car repair bill.
The person in your example still has $725/month left for savings, retirement, and entertainment.
Quote:
Originally Posted by mazerunner
I don't think I listed anything exorbitant in these figures. No vacations. No designer clothes. No dining out. No fancy tech gadgets. But for many people, they are just one disaster away from financial ruin. They are like hamsters in a wheel barely keeping their heads above water. They are too busy trying to survive to care about the guy making $150,000 or more.
No, but your numbers weren't realistic either.
Quote:
Originally Posted by mazerunner
It's a hard life to break out of. Yeah, some people do manage to get out of these circumstances through their own "hard work." But a lot of people "work hard" every day and are trapped in poverty or near-poverty. The system is not stacked in favor of people who are the most at risk.
You have a point here, but America is not for the poor.
A more highly trained and educated workforce that makes American workers have the same average gap in ablity to produce high tech items like the past when we dominated such areas. Screwdriver assembly is a hard area to compete in since poorer countries of the past now have the facilities and materials available to produce such times. Even the automation revolution means less certain skills as seen in the past are needed.Wealth sharing is just raising the bottom level while producing no growth thru higher GDP;it become the new low income.The ACA is likely to be the last large increase in wealth sharing seen for deacdes at its cost also; but it would mean much for many middle class workers most those at the bottom.
That is the only way to eliminate Intelligence Inequality, and it is Intelligence Inequality that leads to Income Inequality.
Reality sucks...
Mircea
I've always believed that differences in IQ is what creates the differing classes of society - which is why we'll always have the rich and the poor.
The solution to this? Make sure that every child that is born has a super-high IQ, through means of genetic engineering. I've always wondered what kind of world we would have if everyone had an IQ equivalent to the top 1% of the population today. At the very least, we need to prevent the poor people from having kids in the first place - that'd help things tremendously - i.e., extinction of the poor...lol.
I still wonder though, even if we could pull off the above, how would a society full of super-smart, ambitious people fare? Would everyone be rich, due to their productive efforts, or would some sort of new class divide develop based on some other quality?
One things for sure, all unequal societies fail at some point or another - as there's no stopping the poor from eventually taking from the rich. It's always happened in the past, and will always happen in the future. People always want what others have! It's no wonder the rich are constantly terrified of having their precious gold coins taken away from them by force, as it's happened all too often in the past...lol.
Some suggestions:
1-No big houses.
2-No big cars.
3-No foreign adventures.
4-Curtail wastage.
5-Domestic peace.
Reduce illegal immigration as much as possible. Tightly restrict legal immigration to skilled workers and reduce asylum for refugees. Foreign born citizens now make up the highest percentage of the US population in 100 years and it's rising. This has greatly increased the wealth and income gap in the US as many of the immigrants are poor and unskilled.
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hum.... 
