I'd forgotten that for months now Charlie Gibson has been asserting that $200,000 is a solid middle-class income, blissfully unaware that just 3.4 percent of U.S. households have an income of $200,000 or more. You could be richer than 96 percent of your fellow citizens, but still just folks to Gibson. Obviously that's not on a par with being bad at bowling or anything on the "out of touch" scale, but it's still disappointing to learn that even our salt of the earth working class multimillionaire television news personalities aren't utterly infallible.
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Out of Touch
16 Apr 2008 11:26 pm
Comments (109)
The performance by Gibson & Stephanoupolis probably has Peter Jennings rolling over in his grave.
Gibson gave a textbook definition of being elitist and out of touch for us all to see. The idiotic capital gains tax questions were an insult considering the actual problems in this country. Well, feel free to add Gibson to the list of cancers in this country.
The person who seems the most bitter tonight is Matthew Yglesias.
Tim K makes his triumphant return to my consciousness.
I missed you, buddy.
And Chris Matthews thinks he is not in the winner's circle because he only makes $5 million a year.
I thought decadence was supposed to be a little more fun.
The performance by Gibson & Stephanoupolis
This is a pet peeve of mine, but it comes up repeatedly both in casual writing and in pop-culture. The correct spelling of the suffix for that surname is -opoulos, not -opolis. TV shows like Webster, unfortunately, caused this mistake to propagate by naming one of the stars George "Papadopolis", and, more recently "Freaks and Greeks" had a character named Nick "Andopolis."
The correct spellings are Stephanopoulos, Papadopoulos, and Andopoulos, respectively.
-opolis is always in reference to cities (eg, Neopolis, modern Naples)
Please stop this. It is annoying the hell out of me.
TinK
Oh I'm sure that if ABC had asked the same questions to Hillary that she didn't want asked, that there would be a similiar blog rage. Right? Pretty rich seeing the reaction, and the meme that Hillary is attacking Obama like a Republican when it's liberals sounding like Republicans in the 1990s. The rage is coming from his performance.
TimK
Oh I'm sure that if ABC had asked the same questions to Hillary that she didn't want asked, that there would be a similiar blog rage. Right? Pretty rich seeing the reaction, and the meme that Hillary is attacking Obama like a Republican when it's liberals sounding like Republicans in the 1990s. The rage is coming from his performance.
Everybody in the middle class has a second home in the Hamptons or Nantucket or Martha's Vineyard, right?
Even Goldberg can see it:
Tactics Uber Alles [Jonah Goldberg]I'm no leftwing blogger, but I can only imagine how furious they must be with the debate so far. Nothing on any issues. Just a lot of box-checking on how the candidates will respond to various Republican talking points come the fall. Now I think a lot of those Republican talking points are valid and legitimate. But if I were a "fighting Dem" who thinks all of these topics are despicable distractions from the "real issues," I would find this debate to be nothing but Republican water-carrying.
more recently "Freaks and Greeks"
"Freaks and Geeks", obviously. I'm sure you can all understand the slip-up.
It would be one thing if the debates had become equal opportunity trash and trivia for everybody, but I never saw anything even closely equivalent during Republican debates. Only the Democrats get to be the big media punching bags.
Gibson forgot to ask Obama if he is a Marxist. Lieberman thinks that's "a good question." And we all know that Joe Lieberman is non-partisan, just like ABC News. So the "debate" is a failure right there, isn't it?
I was just as pissed off at the idiotic Bosnia question that Hillary was asked and answered poorly. I felt the initial question about Bittergate was fair game but beyond that it was one bullshit question after another.
Just because Sean Hannity thinks something is an issue does not make it an issue. It is like asking Hillary if she had anything to do with Vince Foster's death.
"Obviously that's not on a par with being bad at bowling or anything on the "out of touch" scale"
hahaha.
Matt,
I take your point, but there is a difference between income and wealth. For example, the going rate for a first-year attorney at a big law firm in New York or Los Angeles is $160,000 a year. However, the attorney might have had to incur $150,000 in principal debt to earn the degree that qualified her to earn that generous salary. She has income, but she has little wealth, assuming she did not inherit any. Moreover, she is an at-will employee whose income could disappear at any time.
Don't get me wrong. I am not suggesting that an attorney earning $160,000 deserves our sympathy or pity-- she is clearly in a good situation. But having a high salary does not necessarily mean you're on Easy Street.
"The person who seems the most bitter tonight is Matthew Yglesias."
So true. Is Matt going to turn to guns, Jesus and anti-immigrant sentiment now?
Nothing on any issues.
I don't watch debates, but I wonder why anybody would be upset at this. It is a fallacy to think that people vote on issues. They usually don't. Moreover, the two candidates' positions on issues really aren't very different from each other. And, finally, if people really do want to learn about the candidates' positions on the issues, they can just go to the candidates' websites.
IMHO, debates should focus on things other than issues. In particular, for primary debates, it certainly seems legitimate to explore how the candidates will react to Republican attacks - that is something that is highly relevant to your choice in the primary and that you can't find on the candidate's website.
Again, I haven't watched the actual debate, so I take no position on what happened in this particular debate.
"Freaks and Greeks"
I believe that was the working title for 300.
TV shows like Webster, unfortunately, caused this mistake to propagate by naming one of the stars George "Papadopolis"
Did Webster ever take the name of his adoptive family and thereby become "Webster Papadopolis"?
The idiotic capital gains tax questions were an insult considering the actual problems in this country.
The accountants who handle his portfolio must be so worried about capital gains issues, though probably not after this year.
($250k household income? Top 1.5%.)
having a high salary does not necessarily mean you're on Easy Street.
Well, duh. And the Obamas only cleared their law school loans when they got money from his books. But in the fucked-up world of American media-politics, he's an elitist.
I really want to know about capital gains taxes!!!! I'm serious!!!! I really mean this!!!
Meanwhile, in the rest of America, people struggle to get by.
having a high salary does not necessarily mean you're on Easy Street
I suppose if you have no self control and can't deny yourself the 7-series when all you can really afford is a pedestrian 3 then things can get tight. Things are tough all over I guess.
"I'd forgotten that for months now Charlie Gibson has been asserting that $200,000 is a solid middle-class income, blissfully unaware that just 3.4 percent of U.S. households have an income of $200,000 or more. You could be richer than 96 percent of your fellow citizens, but still just folks to Gibson."
Matthew,
This is pretty awesome hackery from someone with your background. Sure, $200k per year would make you rich in Oklahoma City, but what about where you grew up, in Manhattan? That would barely cover rent on a two bedroom apartment and annual tuition for two kids at Dalton.
A lawyer who gets a salary of $160,000 a year after having spent $150,000 getting that law degree is STILL on Easy Street. They are NOT paying that college expense back in the first year they're working. Give me a break.
They'll pay it off over X years like any other loan.
If you're a lawyer AT ALL, you're an "elitist" by definition - unless you do all your work pro bono for people in El Salvador or some shit.
(And if you're in that position of having a highish salary and $1,200/mo loan payments, you're frankly not likely to be worried hugely about capital gains. The AMT, but not capital gains.)
In particular, for primary debates, it certainly seems legitimate to explore how the candidates will react to Republican attacks
Not if it involves treating a bullshit oppo narrative as legitimate material for national prime-time. It legitimises bullshit. Last time I checked, the moderators of the GOP debates never played stenographer for unabashed partisans.
JoeJoeJoe,
The example I cited is a friend. She drives a 5-year-old Honda Civic, and lives in a 400-square-foot studio apartment. She hasn't taken a vacation since 2003, when she started law school. She has made no "golden-handcuffs" purchases. She has the six-figure debt for her student loans, and she could lose her income at any time. Like I said, no one should be crying for her. But income does not equal wealth, even when you're circumspect about spending that income.
I really want to know about capital gains taxes!!!! I'm serious!!!! I really mean this!!! Meanwhile, in the rest of America, people struggle to get by. Posted by Charlie Gibson | April 17, 2008 12:18 AMWhat is really atrocious about Gibson's question and his follow-up is that he kept asserting the fact that revenues go up when capital gains taxes are cut.
In fact, his assertion is wholly untrue.
Gibson is right that a cut in capital gains taxes results in a brief increase in revenue, but that's only because stockholders decide to unload some stocks they have held in the new tax regime; there is less incentive to sell the stock if you know the rate is going to soon drop.
Wow. And to think I was concerned about the state of our 4th institution before the debate. Now? Yikes.
I'd love to see the mainstream media call our ABC News, Gibson, and Stephahfafpadfobus, but I highly doubt that will happen.
Truly pathetic, but even more depressing.
RSH,
Funny you should say that. This girl actually did pay down $75,000 of her law-school debt within 15 months of starting her job. That still leaves her with $80,000 in debt, no guarantee of future income, and something like $7,000 in liquid assets. She makes a lot of money, but she doesn't have a lot of money. There is a big difference.
You see, now having read the comments on the "Hillary Turn" thread, here's my take on Charlie Gibson.
First of all, this fuck is an idiot on his face. I mean, look at the jerk and the way he acts on any given day on his show. "Nuff said, right?
Second, back in the day when I was planning on running a terrorist game, I had plans for jerks like this - and in fact, all the major broadcast news anchors and assorted other bozos like Cokie Roberts. Lead plans. Those people were going down precisely for performances like this and because of the fact that they are part and parcel of what's wrong with this country.
That and the fact that after I'd wasted a few of them, when I told them to publish my propaganda or else, they'd publish it - or else.
Seriously, a few of these morons need to be wasted as a warning to the others. They're traitors to the country just as much as the neocons they continually publish and interview uncritically.
The highest median household income of ANY neighborhood in NYC (per last US census) is Battery Park City at $112,947 per year. The Upper West Side is #5 at $78,066 per year. All this talk about how everybody in NYC can't get by on TRIPLE the median household income of Murray Hill is just pure horseshit. Google some facts, Richie Rich.
I don't want to hear about loans and mortgage payments and how tough it is making it when you make 1000% more than the poverty level. Have a nice warm cup of humble and STFU with your woes. If you lived in South America a good chunk of your earnings would go to security so your rich ass wouldn't be kidnapped and held for ransom.
Fred,
That doesn't change the fact that only 3.4% of the population makes that much, by definition if only thetop 3.4% of the population earns that no way it can be middle class.
Brian, any way you slice it, we're not talking about your friend when we're talking middle-class. It's something every law student deals with and it sucks, but that's what virtually every law student goes through for a period of time, and then they bank after a while.
She ain't in the middle class, and good for her.
Sure, $200k per year would make you rich in Oklahoma City, but what about where you grew up, in Manhattan?
You curiously forget Gibson's original out-of-touch quote:
a family of two professors here at St. Anselm, they're going to be in the $200,000 category that you're talking about lifting the taxes on.
Last time I checked, St Anselm pays its full professors $77k/year, and -- oh, yeah -- is in New Hampshire. Still, by aiming to make a snide remark, you succeeded in looking slightly less of a tit than Seven Million Buck Chuck.
Brian - My harsh comment above is a general comment, not directed to anyone in particular. I'm sure your friend worked hard in school and getting an education which enables you to get a high paying job is an admirable thing so kudos to your friend.
I've just seen one too many comments in these threads about somebody's niece who has to live with a half dozen of her girlfriends so she can afford to live in NYC. Left unsaid --- "to live in NYC and party her ass off". Too many people look at cities as a combination of the uber-rich and a playground when there are many, many working class folks in all cities.
joejoejoe- see my question on the previous thread- do you frequent baseball blogs?
JoeJoeJoe,
I don't have a lot of sympathy for the kind of character you describe, but my point is that the general statement doesn't tell the whole story. This girl lives in Los Angeles not because she wants to party it up-- she doesn't even drink-- but because that's where she's from. Her parents both worked their whole lives in blue-collar jobs and have no wealth to leave behind.
Anyway, the point is, you can be very responsible, do all the right things, and the fact that you have a high salary does not necessarily give you long-term financial security. Again, as I have said all along, she's in a great situation and most people would gladly trade places with her. However, it's still not the same as having wealth-- and someone who has a lot of capital pays a much lower tax rate on it than she pays on her income.
That's all I'm getting at.
I frequent the Baseball Toaster family of blogs and BallHype but mostly I read soccer (The Offside, Pitch Invasion) and basketball (Need4Sheed, Detroit Bad Boys, The Basketball Jones) blogs online. I do less bitching about the misperceptions of income quintiles on those blogs.
It would take a REALLY BAD 1st year lawyer at those $160k pay scale law firms to earn "ONLY" $160k. When you count all the so-called "performance" bonuses that's almost guaranteed, and the NY/CA/DC/CHI "special bonus," The average 1st year associated pay at NYC big law is more like $200k-$250k.
http://abovethelaw.com/bonuses/
If those attorneys manage their money smartly, they can pay back their loan within 2-3 years if they want to.
I know some lawyers that are struggling, and very small percentage of law firms are on the $160k scale. Those people are the elites even among lawyers, and they know it. For them to pretend otherwise when it came to public policy, that's rich.
Well joejoejoe, just be glad I'm not Bronxer.
But income does not equal wealth
Yeah, but at the federal level the US taxes income, not wealth. If you want to eliminate the income tax in favor of a wealth tax, I'm sure plenty of people in the other 96.6% would be happy to oblige.
ZednCu - The Toaster blogs have a very good comment culture in my experience. People are fairly respectful of one another and mostly keep politics out of the sports discussion unless it's on topic. I'm sure we'd get along if we cross paths and Alex Belth & Cliff Corcoran at Bronx Banter have some of the best Yankees coverage anywhere.
During college, I spent four summers and winters working as doorman in the Park Ave. co-op where Charlie Gibson lived until about a year ago. As result of that experience, I can say with the utmost confidence that of all the residents of this building (individuals who all had net worths in the multi-million dollar range) Charlie was by far one of the kindest and most sympathetic. I spoke with him on many occasions about the difficulties facing working class people like myself and my co-workers (all blue-collar folks, many immigrants, just looking to get by with a stable job). He never asked for a hand with his luggage, let alone special treatment of any kind because of his celebrity or wealth. In fact, the only reason he lived in this particular location was because his wife was headmistress at a local private school that owned the unit. Charles Gibson may have misspoken on this point, but he's no oblivious elitist.
Charles Gibson may have misspoken on this point, but he's no oblivious elitist.
He may not be an oblivious elitist, but he's certainly an oblivious member of the elite, based on the economic ignorance he displayed.
"This girl actually did pay down $75,000 of her law-school debt within 15 months of starting her job"
Was she REQUIRED to do that or did she do that because she wanted to be sure much of her debt was paid off quickly?
"no guarantee of future income, and something like $7,000 in liquid assets."
Gimme a break - MOST people have no guarantee of future income, and would die to have $7,000 in liquid assets.
The most I've ever had in the bank at one time was $3K and that didn't last more than a month or two since I was unemployed at the time.
And I didn't say she was "wealthy", I'm saying she's better off than a hell of a lot of people - and being a lawyer, she's going to GET even more better off than most people if she's not a moron.
Patrick,
I don't care if the guy is an elitist, peasant, socialist, or an 18th-century pig-faced capitalist. He did a MAJOR disservice to the American people by asking questions that were utterly irrelevant to the problems American faces today.
The overall point is that he did a piss-poor job of moderating and administering the debate. Whether he's an elitist or not is irrelevant.
Lmao, the most pathetic thing in here is that some people are defending the idea that making 200k means you're doing poorly.
That would basically mean that 90% of the country is living in absolute, abject poverty. There are towns in this country where you people would be strung up for saying some of this shit.
All this proves is how pathetically out of touch the Atlantics audience is.
Kanchou-- she's in L.A. Bonus was $5K for 2,000 billable hours. No special bonus.
RSH-- yes, most people have no guarantee of future income. But people with capital do, and the question was about class. Wealth affords you upper-class status, not income-- at least not income at that level. Again, I am not saying that she is disadvantaged. She's in a great situation.
No, she wasn't required to pay down her debt, but the point is that even if she hadn't paid it down, she'd have $75,000 in the bank, but still have a negative net worth because of the $150,000 in debt. How well-off are you if your net worth is negative? Granted, if she keeps doing the right things and doesn't lose her job, she's on her way to real financial security that most people never achieve.
Soullite,
Who said that someone making that amount is "doing poorly"? I have repeatedly cited an example of someone making $160,000 and repeatedly said she's in a great situation that most people would like to be in. However, that doesn't mean that she has financial security other than in the short term. Income is an imperfect indicator of one's financial well-being. You can be making more than 95% of people, but it doesn't mean that you're *richer* than 95% of people, especially if access to the high-paying job was unattainable without amassing a mountain of debt.
Everyone's ignoring the consequences of Obama's plan to scrap the cap on the Social Security tax. First, even if $200k is in the top 3.4% of incomes in America, it's a level most young couples can reasonably aspire to. There are nurses, cops, principals, pharmacists, etc. making over $100k. Two of them get married, work some overtime, and they're at $200k. This isn't George Soros money. Lifting the cap on Social Security taxes would be a huge marginal tax increase on them, and would discourage all those who aspire to earn that level of income.
Even if a President Obama ameliorated this with his donut hole idea, there's another consequence he apparently hasn't thought through: extravagant Social Security taxes will lead to extravagant Social Security checks: a surgeon making $500k per year might retire with $20k monthly Social Security checks. That won't be politically sustainable, and neither will be the alternative of taxing the surgeon on $500k in income but giving him benefits as if he had only been taxed on $100k in income -- that would turn Social Security into a welfare program instead of a universal social insurance system. Rational liberals have resisted that for decades because they know that it would undermine the political support for Social Security.
The Obamas have spent a lot of time talking about how financially stressed they were on their income, which averaged about $207k per year from 1997-2004, reaching $252k in 2004 (i.e., before Barack's book deal and Michelle's giant wife-of-Senator raise in 2005).
Fred,
The Social Security/Medicare cap is an individual amount. If it is imposed on income over $200,000, a couple would have to make $400,000 in joint income, assuming they have equal incomes, to be subject to the additional tax.
With respect to the surgeon's theoretically exorbitant benefit, it's easy to deal with. You cap the benefit.
The "Disney Debate" was pure crap! The questions seemed like fluff & fodder. Barack didn't looked exasperated with the sheer lack of substantive issues that Charlie Gibson & George (Might as well be Bush) Stephanopolous brought to the table.
Bitter Voter... Holding out for HOPE!
Suz
Fred,
Does someone on the left pay you to come spout right wing nonsense to re-enforce how stupid the right is? Do you have even a remote sense of remedial logic? If only 3.4% of the population makes over $200K then most young couples can't reasonably expect to achieve that level, only a very small percentage of them can. Do I need to explain what 3.4% means using pictures for your right wing lizard brain to get it?
I think it's fair to say that all Americans have said a prayer tonight. We prayed that Charlie Gibs gets to keep his capital gains tax cut.
Brian,
"The Social Security/Medicare cap is an individual amount."
Do a little homework before attempting to engage with me on this topic next time. The Medicare portion of the payroll tax is already uncapped. As for this facile comment:
"With respect to the surgeon's theoretically exorbitant benefit, it's easy to deal with. You cap the benefit."
And then it goes from being an (albeit, already progressive) social insurance program to being an outright wealth redistribution program, because the surgeon -- instead of getting an effective ~2% return on his Social Security contributions -- will get an effective negative ~80% return on them. As I said above, this is the reason rational liberals have resisted doing this for decades.
Attacking the messenger... sorry your candidate was horrific tonight.
It does take $200K a year to be solidly middle class. That might be a slight exaggeration, now, but just wait. Inflation is doing it's work well. Perhaps the most important effect of all the economic trends is that the middle class is going to shrink, and that's even after the middle class gets defined down. By which I mean the mean or average numbers used to define middle class will stay the same even as the cost of living soars.
I shouldn't say it will happen, as far as the inflation numbers go. After the inflation there could be deflation. However that's the thing the Central Banks are fighting tooth and nail. They can win if they somehow can print enough money and they probably will.
My seat of the pants guess. A 5% increase in the poor with a commiserate decrease in the middle class. Half of the 'middle class' actually being the working poor with negative net worth; debt slaves. Oh yea, and no more government help for them, less in fact. The hospitals will be closed to many of them soon enough. No student loans for their kids. Worse schools, worse roads, fewer police who make up for their load by being far more putative and brutal.
It's a dream come true. It's Morning in America.
Re: She has the six-figure debt for her student loans, and she could lose her income at any time.
In the event of unemployment student loan payments can be deferred. And your friend is eminently employable. Shoudl she lose her current job she will find another one promptyly-- unlike, say, a mill worker in Cleveland who may never find a job making remotely his current salary if he's laid off.
Re: Lifting the cap on Social Security taxes would be a huge marginal tax increase on them, and would discourage all those who aspire to earn that level of income.
Oh bullshit! If someone came to me and said: "Good news is you salary will 200K, bad news is you'll pay a 7.5% payroll tax on that" I would certainly go for the deal, since it would still leave me $192,500.00, which is very much more than double what I am making right now. Who but an idiot would not go for that deal?
Re: And then it goes from being an (albeit, already progressive) social insurance program to being an outright wealth redistribution program, because the surgeon -- instead of getting an effective ~2% return on his Social Security contributions -- will get an effective negative ~80% return on them.
Again, bullshit. The return would less, but would still be positive. The worst you can do on Social Security is 0% of your contribution back-- if you die before collecting benefits. Meanwhile don't forget the other big benefit of Social Security-- it spares most people from the financial burden of supporting parents and other elderly relatives. Such a burden would be ruinous to most families, and for those worried about birthrates, it would end the ability of most families to afford children. That's a huge part of the reason that Social Security is so popular.
I'm completely ok with a 'wealth' tax instead of an 'income' tax! I'll just spend all my money at the bar! Then I won't have any wealth....see? Works fine.
Frankly, your friend knew that the bills were expensive, and knew she wouldn't be 'wealthy' within five years. However, she should be in...what, 20? How many Americans will be wealthy after 20 years? Not many.
The only sane way to tax people is on income, that I can see.
Charlie Gibson is the elitist one.
And quite frankly, as others have pointed out, the blame is not just on ABC News but on Hillary Clinton.
They only pushed these inane questions because Hillary has. She could have easily taken the high road a long time ago and denounced this smearing and silly line of attack. But she has chosen not to.
I mean, if the debate had been Obama vs anyone else in the Democratic party, does anyone think these questions would have been raised? Or if they had been, someone like Biden or Edwards would have immediately denounced them. That's the big difference.
Again, it's not my original saying, but Hillary is becoming the Goldwater Girl again. From now on let's call her Hillary Limbaugh Clinton.
It does take $200K a year to be solidly middle class.Pure, unadulterated horseshit. I'm a single father making 71K out of which I have to pay 9K spousal support to my ex (I get back a little of that at tax time). Sure I don't have money to throw around, but I live comfortably enough and I don't expect anybody to take up a collection for me any time soon.
I'm a couple years out of law school with the aforementioned six-figure debt. My wife and I make a combined little less than 100K and I feel rich. I have a nice enough house and fancy beer in the fridge. I'm set. I'm continuously shocked by the "but I have student debt" argument. Get over yourselves.
Well, we do have a bit of difference in use of terms. Having an income $200,000 or $300,000 or $1,000,0000 per year might put you in a different social and cultural and financial circle than the vast majority of Americans, but it sure doesn't make you upper class, which is typically defined as (a) being much, much, much wealthier, and (b) having been there for a much longer time.
if she hadn't paid it down, she'd have $75,000 in the bank, but still have a negative net worth because of the $150,000 in debt. How well-off are you if your net worth is negative?
Pretty well, actually. If we estimate that her payment on that debt is $2000/month, amortized over 10 years, then even if she ends up losing her job and getting lower-paying one that just covers her expenses, she can keep paying down her debt for more than 3 years.
As it is, she's paid down her debt by 50% and could easily refinance the loan to lower the payments, which gives her a greater cushion in the event that she faces a loss of income.
Your friend's position is not unique-- it's something faced by just about everyone who went to a top-tier law school without a scholarship. Somehow, they manage.
Lifting the cap on Social Security taxes would be a huge marginal tax increase on them, and would discourage all those who aspire to earn that level of income.
No, it wouldn't be a "huge" marginal tax increase on them. Next, it would not discourage all (all?) those who aspire to earn that level of income. No one likes taxes, but they doesn't make people decide to eschew law school in favor of being a paralegal. At very high marginal rates, for some people who are paid for each additional unit of work and are working out on the margins of work hours, in the 70-80/hr/week range, there may be a point where the tradeoff versus free time isn't worth it, but we're not there yet, and the fact that the government needs to cover its costs makes the discussion academic, anyway.
I don't feel for your friend. She'll be fine. Plenty of highly-paid professionals, including the Obamas, never paid off their loans until they were 40. It's a cost of doing business that makes the loans worthwhile to take out in the first place.
Well I am in the 3.4% here. Can't say that the amount of money that I pay in tax is an issue for me.
After federal taxes the two largest deductions from my paycheck are for my 401K which I generally aim to max out by October and my stock plan which currently provides a significant guaranteed return. Essentially they are both forms of savings.
The only real justification for the cap on contributions to social security is that there is a cap on distributions. The idea of social security is that it guarantees a minimum pension. If you are earning $90K plus you should probably be putting the surplus into some form of pension plan. Its privatized if you like.
I never believed that the Bush tax cuts would be in my personal interests even though they were meant to buy votes (and campaign contri-bribe-tions) from people like me.
The first reason is that I have a much bigger interest in the health of the economy than the marginal tax rate. 4% growth compounded over four years comes out at 17%. There is no imaginable tax cut that would come close to the same effect. The GOP tax cuts have not provided an effective long term economic stimulus because the markets know that its borrowed money and will have to be repaid, either in future tax increases or through inflation.
The second reason is that the tax cuts were ostentatiously unfair in a system that was already strongly tilted to favor the rich. A backlash was and is inevitable and when it happens it is going to cost people like me much more than we ever stood to gain.
Finally, despite being in the Bush demographic, I have not benefited by any of the Bush tax cuts until last year when the Democrats passed a bill fixing the AMT. This is because the Bush tax cuts were designed to serve the interests of trust fund babies like himself, not self-made working rich like myself. Because of the AMT rules that create huge tax liabilities on certain unrealized stock gains I was forced to prepay roughly four times my base salary in 2001. I get the difference back each year as the difference between the standard and the capital gains tax rates. So while I was struggling to pay off a mortgage I had been forced to lend almost twice as much to the government.
For some reason the Republicans were totally uninterested in this patently unfair situation. My case was far from being the worst, some people lost their houses. What was meant to be an incentive scheme turned out to bankrupt some of my co-workers. No employer in Silicon Valley will touch ISO stock options any more. The point here is that it took a Democratic Congress to actually fix this issue.
So no, do not repeat the idiot claim that Bush or the GOP are good for the working rich. They are not, they cost us money. As anyone who has made a fortune knows, the wealth trickles up, not down. For me to sell my product I need to have people with the money to afford it and the time to use it. Grabbing all the money for the richest of the rich makes us all poorer. It only makes sense if you are the type of person who measures wealth by what you have that others do not.
It does take $200K a year to be solidly middle class.
Ok, look, I know a guy who makes half that, at most. His wife is an artist and art teacher, and I assume her income is small, since she spends most of her time caring for their two young children. They have a small house and two cars in a Maryland suburb.
That pretty much defines middle class.
Now, to "solidly" afford a $600,000 house and two late-model cars and afford yearly European vacations, yes, that probably requires $200k. Throw in private school tuition for two kids, and I can see how you'd be struggling. But that's not what we typically refer to when we think of "middle class."
It's an affectation of those of us who come from or aspire to join rather elite lifestyles that we regard $200k as "just about what we need." Which is precisely the point: that's how Charlie Gibson perceives things.
It takes at least $1,000,000 per year to be in the middle class. I'm barely scraping by on 800K. For example, this morning I didn't even have any gold dust to sprinkle on my bald eagle egg omelets.
Again, it's not my original saying, but Hillary is becoming the Goldwater Girl again. From now on let's call her Hillary Limbaugh Clinton.
I'm starting to think she's angling to be McCain's Vice-Presidential pick. Think about it-- she gets the conversion narrative like Holy Joe, McCain gets a solid attack job, she gets really good odds at getting to be President...everyone wins.
Except of course the American people, but who cares about them?
I couldn't get over the asinine nature of questions asked in the debate last night. Gibson and Stephanopoulos should know better. Then there were the questions chosen from "viewers". The woman who asked about the flag pin. The amount of time spent on Jeremiah Wright. Hillary bringing up the church's connections with Farrakhan and Hamas. Dwelling on gun control.
I don't think Obama did very well. Neither did Clinton, however. She kept on slamming and he weakly responded. He gave her a pass on Bosnia and she just kept on turning the screws.
*Sigh*...business as usual. No Lincoln-Douglas here...not even a Kennedy-Nixon.
Fred: Everyone's ignoring the consequences of Obama's plan to scrap the cap on the Social Security tax. First, even if $200k is in the top 3.4% of incomes in America, it's a level most young couples can reasonably aspire to. There are nurses, cops, principals, pharmacists, etc. making over $100k. Two of them get married, work some overtime, and they're at $200k.
Classic... I had to read this comment to my wife. Reasonable to aspire to $200k/year? Nurses making $100k? According to this, 4% of nurses make more than $85k: http://rn.modernmedicine.com/rnweb/article/articleDetail.jsp?id=105105 For cops, I don't see a lot of numbers in that range: http://www.theblueline.com/salary1.html
First, even if $200k is in the top 3.4% of incomes in America, it's a level most young couples can reasonably aspire to.
Class, can anyone point out the failure in Fred's, um, let's call it "logic" here? Anyone?
He just has a somewhat, er, idiosyncratic vocabulary, in which "aspire" is a synonym for "fantasize".
Everyone's being unfair to Gibson. He's just extrapolating from current trends. Given the amount of money the Fed keeps pumping into the economy, I'd guess over 40% of the population will be making $200K within two years. Of course at that point gasoline will cost $25/gallon, $8 will buy 1 Euro, and a dinner for 2 at Applebee's will run you over $200.
How well-off are you if your net worth is negative?
So if someone just bought a home (in non-housing crash times) they're in horrible shape? Debt to income is a little more useful than just total debt load.
People may be confusing what we think a typical middle-class life is supposed to look like and the actual lives lived by people who really are in the actual middle classes. At least in the more expensive areas of the country, a $200,000 a year income is about what it takes for a small family to live in a decent-sized house, buy a car every two or three years, eat out three times a month, take a two-week vacation somewhere, save up a reasonable percentage of college costs, and fund your IRA's -- at least if your employer provides decent health care. (I often wonder how I would be living if I left NYC and returned to my native Syracuse.) That doesn't sound like an "elite" life style, and it isn't, but those in the real middle classes would give their eye teeth for it.
I aspire to an income of 300 brazilian dollars an hour. It's America. It's intoxicating.
Aspiration Fever. Catch it!
Judging by Oakland PD salaries, the information
on that website (blueline.com) seems to be
SERIOUSLY off.
e.g. according to the official website
http://www.opdjobs.com/oakland-police-department-salaries-and-benefits.htm
the ENTRY-LEVEL salary is $69000 to $87000.
And, this is just entry-level.
DJ, Oakland has a higher cost of living. If you look on blueline.com, it lists Sunnyvale, CA as having salaries comparable to Oakland's.
Look, I'm as much of a coastal elite as the next guy, but I realize that my experience and my cost of living isn't typical, and I shouldn't expect my personal salary goals and what it would take the lifestyle I want to live in my community with what is "typical." Unless the "typical" police officer lives in the SF-Bay area, it shouldn't be surprising the those salaries are going to be out of step with what one normally expects from those professions.
I should clarify that blueline.com gives the
Oakland PD salary range and 63k to 79k which
is much below even the actual ENTRY-LEVEL range
of 69k to 87k.
DJ, ah. I didn't see Oakland, CA mentioned at blueline, so I didn't realize you were referring to what they actually reported for Oakland.
It's all a question of semantics, for sure, but I think the people with the 200k+ incomes we are talking about would be considered "upper middle class" in ordinary language. What distinguishes them from those considered "rich" is the fact that they depend on their salaries rather than wealth. A common definition of "rich" is the ability to finance an upper middle or upper class lifestyle solely through interest/capital gains.
obviously where you live matters. a great deal.
when I first moved to NYC, I was making about 45K (in 2003). now I make about 125K. my lifestyle hasn't changed much. the difference is that now I'm not spending 1200 a month on a tiny closet with roommates in a fake 3 bedroom (really a converted 1 bedroom)...it's more like 3K a month to live in a real 1 bedroom. and I eat out better.
why? because my take home hasn't improved by much. because of TAXES.
I pay close to 50%. yes, 50%. (three income taxes in NYC.) I didn't when I was making 45K.
now subtract student loan payments (on 165K) and rent. there's not much left.
I'm not asking anyone to cry for me...but there's no financial security in Manhattan on 125K (and I couldn't make that much doing what I do somewhere else). there just isn't. if I lost my job tomorrow...in three months I couldn't make rent. I live fine, but that's simply not wealthy in Manhattan.
I'm not asking anyone to cry for me
Trust me, we're not.
Am I the ONLY person who went from graduate school to a well-paid job who realizes that any financial challenges he faces are essentially matters of personal CHOICE related to his lifestyle preferences?
PHB - Great point! I have been arguing this a lot lately. I wish more people were not so damn short-sighted about this issue. I make ~150K and I also take the wealth trickles up perspective. Heck, I work in the wireless business. There are over 1 billion phones sold each year. So this is especially true for me.
How do you think it would play if in response to criticisms of elitism, Obama pointed out that most of his media critics made more than him for most of his career?
Read what I said in every post. I affirmatively stated that my friend, who was just someone I was citing as an example-- don't miss the forest for the trees-- does not deserve sympathy or pity. I said that she's in a great situation, and that most people would gladly trade places with her. Yes, she made a choice to attend an expensive private law school without a scholarship. However, none of that changes the essential premise, which is that income, in a vacuum, does not necessarily reliably indicate the "class" a person resides in.
And I never suggested that income shouldn't be taxed. It should be taxed similarly to wealth-- i.e., wealth should be taxed at higher rates.
Nathan:
I wonder about your math. I'm looking at my pay stub from yesterday. We both live and work in NYC and make about the same. My taxes come out to just a smidgen over 39%, which is "close to 50%" in the same sense that major combat operations ended in Iraq in 2003. I suspect that your after-tax pay now is a great deal more than it was when you were grossing just over a third as much.
For the several people whining about how sure, they'd be rich if they lived in Podunk but in big coastal cities they're barely getting by:
I make $80,000 doing HIV research, am about $100,000 in debt for law school (though $0 for my PhD), have a wife who makes negligible income because she takes care of our 5 year old & consider myself solidly middle class.
Of course, my kid goes to public school & I live in Brooklyn.
Perhaps there's a hint here for those complaining about how they can barely get by on their 6 figure incomes after Manhattan coop payments or $3,000 monthly rent & private school tuition?
Someone above actually is so out of touch with reality as to speak of the burden of Dalton tuition on middle-class parents! Clue: if you are considering sending your kid to Dalton on other than a full scholarship basis, you are not just rich, but very rich. Is there a more elite institution in the city?
Elite in the economic sense, of course; I can't imagine anyone would seriously claim Dalton is academically superior to the top public schools like Stuyvesant.
Yes, it costs a lot of money to live like a rich person. That there isn't a lot left over after paying for your rich-person status signifiers doesn't mean that you're middle-class, only that you are a member of an economic elite with no conception of how most people live.
Median household income for Manhattan was $47,030 in the 2000 Census. How can anyone making 2-5 times that (like several posters above) rationally believe he/she is a member of the middle class? Having less money than the very rich doesn't make you middle class.
CJColucci : "...buy a car every two or three years, eat out three times a month, take a two-week vacation somewhere,..."
Jeeze, that is middle class? Hell I didn't know I was getting towards the poverty line with my long weekend vacations to drivable spots, my eating out once a month (maybe) and my six and seven year old cars.
I think the problem here is the definition of middle class all depends on who you compare yourself to. Unless you actually check against the median amount of income in the country...then middle class sure as hell doesn't exist at the $200k level.
CJCollucci:
add in the SE tax.
CJCollucci:
add in the SE tax.
buford puser:
well, yeah, Brooklyn helps...it also helps if you've been renting the same place for a number of years...because then you're almost certainly paying well-below market rent.
the 2000 Census was conducted 9 years ago. In addition, it included large populations in Harlem, Washington Heights, students, Chinatown and all the old people uptown and in the WV who are fabulously wealthy but don't really have any income.
fact of the matter is...stats from 2005 indicate that in the downtown neighborhoods of the West Village, TriBeCa (which has the wealthiest zip code in NY), SoHo, NoLIta and BPC, close to half the working population makes six figures. and the rest are mainly just shy of it.
yeah, Murray Hill and the UES are filled with kids in entry level jobs making 40K...they're also living two to a bedroom....or living off their parents.
Nathan:
No, sorry, moved into our $1,600/month newly reno'ed very-typical-market-rent apartment a year ago.
Your stunning arithmetic acuity in noting that 2000 was 9 years ago aside, perhaps you were not aware that the US Census is conducted every 10 years? The next will be in 2010. This is thus the most recent census data available. According to the Dept of City Planning website, "New York City's per capita personal income (adjusted for inflation) decreased by 3.0 percent or from $44,268 to $42,945 from 2
I'm not suprised. My colleague asks his undergrad students "How much do you have to make to be in the top 10% of household income?" and people drastically overestimate the amount. The real number is like 150k, but most students put it at double that amount.
Posted by TheF79 | April 16, 2008 11:39 PM