patrick.net

turtledove says

We are the weakest members of the 1%, and we are the ones they are going after.

Clearly, it's not the top 1% that's the problem. It's the top 0.1%, and then only a subset of them. It's probably more like the top 0.01%, but that doesn't have the same ring as "we're the 99%".

The parasites are the rich who gained their riches, not by producing goods or services, but by siphoning off of others. It's the owner/controller class.

There's nothing wrong with rich doctors, inventors, actors, professional athletes, etc. They produce wealth, even those in the entertainment business. And they do not steal wealth from others.

The executives at Goldman Sachs, Bank of America, etc. are the ones who acquire their wealth by stealing from others using means that are legal because they bribed politicians to make those means legal.

People don't hate the rich. People hate some of the rich, and only then not because they are rich, but because of how they got rich.

Certainly people have it much harder than we do. It just pushes my buttons to be lumped in with multi-millionaire wallstreeters, when at the end of the day after taxes, health insurance, and house payment, we're left with a whopping $5k/month. Of course, we have yet to pay a single bill -- or eat, yet.... and yes, we chose to live in a high-cost area. However,

My husband is a pretty average earning employed doctor (specialist). So, we don't just get it from the side of tax policy (the rich aren't paying their fair share, etc....), we also get it from the masses who are under the impression that doctor's are super-rich and completely to blame for the rising healthcare costs in this country. Yes, there are some doctors out there who've scammed the system and profited from their profession in a way that violates the spirit of the oaths they've taken. But, I've never met one, personally. The "evil" doctors taking advantage of the system are hardly representative of the profession as a whole.

The point of all this is.... If a generally recognized higher paying profession has difficulty cutting the mustard, and 99% are in a worse situation than us -- then we've got a pretty f'ed up system.

turtledove says

Certainly people have it much harder than we do. It just pushes my buttons to be lumped in with multi-millionaire wallstreeters, when at the end of the day after taxes, health insurance, and house payment, we're left with a whopping $5k/month. Of course, we have yet to pay a single bill -- or eat, yet.... and yes, we chose to live in a high-cost area.

$5k/mo ain't bad! Your non-shelter related bills shouldn't amount to more than half that. That leaves you with at least $30k/yr

Do you work or is that all your husbands income?

Dan8267 says

There's nothing wrong with rich doctors, inventors, actors, professional athletes, etc. They produce wealth, even those in the entertainment business. And they do not steal wealth from others.

Well, there's something wrong with the medical sector since our costs are way out of line with the rest of the world.

Regulatory capture by the looks of it.

I don't have any (first-order) problem with the millionaires in sports and entertainment. Everyone parts with those dollars freely.

Health care is different. There are super-stars in medicine who earn their premium, but they're exceptional.

http://research.stlouisfed.org/fred2/graph/?g=pZC

per-capita (age 16+) health costs, US

Here's what Churchill said about professional fees back in 1909:

"If a doctor or a lawyer enjoys a better practice, it is because the doctor attends more patients and more exacting patients, and because the lawyer pleads more suits in the courts and more important suits.

"At every stage the doctor or the lawyer is giving service in return for his fees, and if the service is too poor or the fees are too high other doctors and other lawyers can come freely into competition. There is constant service, there is constant competition; there is no monopoly, there is no injury to the public interest, there is no impediment to the general progress."

He was comparing these fees to land rents, and he's correct as far as he goes, but clearly competition is not so "free" in the US currently.

We have a glut of lawyers and a lack of health professionals apparently.

Dan8267 says

Reality says

Berners-Lee was on the payroll work hours of a government-funded entity (CERN) when expanded on hyper-card. Neither the FED nor the CERN were particularly capitalistic entities.

The World Wide Web went far beyond CERN. My question stands. If capitalism rewarded wealth creation and innovation, why isn't Tim Berners-Lee the richest man who ever lived?

Because Berners-Lee was working for a socialist institution. In any case, even if he invented on his own time in his garage, there would be nothing preventing him from giving it away instead of patenting it. Free market capitalism is about freedom of personal choice.

turtledove says

It just pushes my buttons to be lumped in with multi-millionaire
wallstreeters, when at the end of the day after taxes, health insurance, and
house payment, we're left with a whopping $5k/month. Of course, we have yet to
pay a single bill -- or eat, yet.... and yes, we chose to live in a high-cost
area. However,

My husband is a pretty average earning employed doctor (specialist).

Holy crap - this is very hard for me to believe. What is your house payment? Must be very high. Do you live in a high tax state as well? California?

I am 99.99% certain you do not work if this is true. That right there puts you in a very elite class - single income families are very few and far between these days.

To have $60k after taxes and housing payments per year - you are probably in the top 5%. Especially when you consider this is done with one income.

Top 5% make $161,579+, collect 33% of the income and pay 60% of the taxes.

'course, they have 95% of the disposable income now, LOL.

http://taxfoundation.org/article/summary-latest-federal-income-tax-data-2012

"The 1%" starts at $369,691.

control point says

Top 5% make $161,579+, collect 33% of the income and pay 60% of the taxes.

Right - she says $60k after taxes, housing, and health insurance.

Total taxes are probably ~36% at $161k. 1.45% Medicare, 4.5% SS, 10% State income in Cali, 20% Fed Income.

64% of $161k is $103k. Take out $10k for health insurance and $2500/mo. mortgage. Bam, ~$63k left.

Bellingham Bill says

Top 5% make $161,579+, collect 33% of the income and pay 60% of the taxes.

'course, they have 95% of the disposable income now, LOL.

http://taxfoundation.org/article/summary-latest-federal-income-tax-data-2012

"The 1%" starts at $369,691.

Where is the disposable income number coming from? The poor has negative taxes due to government handouts . . . some of which translates into disposable income and unfortunately get spent on wasteful and harmful things like cigarettes. I see alcohol and cigarette use much more prevalent in poorer neighborhoods. Personally I don't even have a hobby that costs as much as a pack a day ($3-4k a year).

New Renter says

$5k/mo ain't bad! Your non-shelter related bills shouldn't amount to more than half that. That leaves you with at least $30k/yr

I agree--$5K/month after taxes, housing, health care is a LOT. If someone is crying about that, they need to have their head examined.

HydroCabron says

Blurtman says

Also consider the benefit of a two-tiered justice system. Sell drugs for the Mexican cartels - go to jail. Launder millions for the Mexican cartels - see you at the club this weekend.

When the wealthy are prosecuted for crimes, they just pass the costs onto consumers, and we end up paying more.

Agree but that is true for all crime.
Street crime costs the victim in loss and medical expenses which burdens the system
Ditto for the court fees and prison fees
The difference is while both types of crime add costs to society, corp crime goes unpunished

HydroCabron says

When the wealthy are prosecuted for crimes, they just pass the costs onto
consumers, and we end up paying more.

I thought that prices were determined by the market.

Reality says

I see alcohol and cigarette use much more prevalent in poorer neighborhoods.

This study says otherwise:

http://paa2010.princeton.edu/papers/101517

turtledove says

My husband is a pretty average earning employed doctor (specialist).

Most people don't realize that doctors pay a lot of money for malpractice insurance. And that eats away at their income.

But as I said before, even if a doctor is rich, that's ok because doctors produce wealth, they provide critical services. They literally save lives with their hands. Doctors should be rich. Bankers and those white collar criminals in the financial industry should not.

Bellingham Bill says

Dan8267 says

There's nothing wrong with rich doctors, inventors, actors, professional athletes, etc. They produce wealth, even those in the entertainment business. And they do not steal wealth from others.

Well, there's something wrong with the medical sector since our costs are way out of line with the rest of the world.

There are many things wrong with the health care industry, but doctors are not one of the problems. The real problems are:

1. Fraudulent billing and accounting by health care providers, particularly hospitals.

2. Corporate games and shenanigans used to convert a hospital, a single business, into various "independent on paper" businesses, so as to prevent legal accountability when something goes wrong.

3. Private health insurance -- this should not even exist. We should use a non-profit, nationalized health insurance paid by income tax. Side note: the graduation of the income tax should be a function of the rich-poor gap and far more graduated than it is today.

4. Administrative inefficiencies that can be solved by hiring a genius like me to streamline health care administration and automate all accounting. Yes, this is a big project, but good software engineers can do things that mediocre engineers simply cannot do.

Well, you can control this. The more democrats you elect, the more Fed Systems will be deployed.

turtledove says

The point of all this is.... If a generally recognized higher paying profession has difficulty cutting the mustard, and 99% are in a worse situation than us -- then we've got a pretty f'ed up system.

Reality says

Because Berners-Lee was working for a socialist institution.

If CERN is a "socialist institution" than so is the U.S. military and we should get rid of it.

Dan8267 says

Side note: the graduation of the income tax should be a function of the rich-poor gap and far more graduated than it is today.

While good in theory I do think just socking the rich with more taxes will result in higher home values and rents for everyone.

Cut taxes on the masses, and housing rents go up.

Hand out free money, housing rents go up.

http://research.stlouisfed.org/fred2/series/CUUR0000SEHA

breathe and housing rents go up

Bellingham Bill says

While good in theory I do think just socking the rich with more taxes will result in higher home values and rents for everyone.

It's not about socking the rich, but rather aligning their self interests with society's interests. If the gradation of the income tax were a function of the rich-poor gap, there would be a point where siphoning more wealth would make the rich poorer and the only way the rich could increase their wealth is by increasing everyone else's.

Bellingham Bill says

Cut taxes on the masses, and housing rents go up.

This is just an manifestation of a more general problem. The problem is that privatizing rent income is terrible for society. Rent income should support the whole of society whereas most or all of income from productivity should be retained by the individual.

As technology advances and more jobs are automated either society will be divided into permanent haves and have-nots, or the gains of automation and ownership will benefit everyone equally. In the former scenario, the haves will kill all the have-nots and then turn on themselves. In the later scenario, no one will ever have to work again and yet will maintain an every increasing quality of life. Which world would you prefer?

New Renter says

$5k/mo ain't bad! Your non-shelter related bills shouldn't amount to more than half that. That leaves you with at least $30k/yr

Do you work or is that all your husbands income?

Still not shopping for mansions and yachts with $30k!

That said, student loans and the child support he pays to his ex-wife make a pretty big dent.

Not saving much, that's for sure.

Yes, I'm a stay-at-home mom. I'm very lucky that we can manage it (barely). Having a parent at home is fast becoming a luxury.

control point says

Reality says

I see alcohol and cigarette use much more prevalent in poorer neighborhoods.

This study says otherwise:

http://paa2010.princeton.edu/papers/101517

Read the study itself, and you will find that it acknowledges there are studies showing results every which way. There are fundamental methodology issues: sample method and self-recognition bias. The self-medicating type among the lower income strata is far more likely to under-acknowledge than the social drinkers in the upper strata.

In any case, the spending on alcohol and cigarette as percentage of disposable income in a neighborhood is easily recognized by the type of stores in the area. Liquor stores and stores that sell cigrettes grossly over-represent in poor neighborhoods.

control point says

Holy crap - this is very hard for me to believe. What is your house payment? Must be very high. Do you live in a high tax state as well? California?

I am 99.99% certain you do not work if this is true. That right there puts you in a very elite class - single income families are very few and far between these days.

To have $60k after taxes and housing payments per year - you are probably in the top 5%. Especially when you consider this is done with one income.

Yes, this is California, the land of insane house prices. Irvine doesn't have much 4-bed product under $1m (and that's a tiny dump). I'm not saying that we're poor. But when you think of the 1% who are made out to be the super-rich who are not paying their share, does my situation really strike you as the same as Mitt Romney, for example? He pays a much lower percentage in taxes than we do. We're progressive to a certain point (and type) of income... Then, it goes the other way.

tatupu70 says

New Renter says

$5k/mo ain't bad! Your non-shelter related bills shouldn't amount to more than half that. That leaves you with at least $30k/yr

I agree--$5K/month after taxes, housing, health care is a LOT. If someone is crying about that, they need to have their head examined.

LOL. We are not talking about a single guy living in his mom's basement while being paid to make online posts. Doctors are supposed to be one of the admired professions. Pretty girls used to fight for them, then after winning the fight would still have to put up with husbands being on call at the hospital 24/7. Serious sacrifices on the home front. $5k/mo is barely enough to put one kid through private high school or college. At this rate, why not spread legs for a good-for-nothing pot head instead of a doctor! At least the jobless pot-head live-in boyfriend would always be available at home; the household expenses can be paid for by welfare, like section 8, food stamps and cash subsidies, that would also add up to about $1k to spend each month after all housing, taxes and medical insurance already paid for by taxpayers. Such is the perversity of our tax-and-welfare system.

Dan8267 says

Bellingham Bill says

Cut taxes on the masses, and housing rents go up.

This is just an manifestation of a more general problem. The problem is that privatizing rent income is terrible for society. Rent income should support the whole of society whereas most or all of income from productivity should be retained by the individual.

Rent income is always privatized . . . because all goods and services are ultimately privatized: a piece of food in my mouth can not be swallowed by you. The only difference is whether:

1. limited resources are allocated competitively in an open market place with two-way freedom of choice

vs.

2. a bunch of bureaucratic monopolists allocating the same limited resources to their own benefit thereby creating Economic Rent for themselves.

There is no such thing as "public" when it comes to limited single-use/mutually-exclusive-use resources. Someone has to swallow a piece of food. The only thing "the public" can swallow is the bill paying for the food (i.e. the cost), not the food (i.e. the benefit). Only the individual ultimately gets the benefit. When "the public" picks up the bill, it just means the cost is transferred to other individuals not getting the benefit.

It's my thesis if we lowered taxes on the top 5%, Irvine prices would just rise to take the tax cuts, since each household -- at every level of the 'property ladder' -- takes their after-tax income and bids up the cost of housing with it.

That's OK for you, since you've locked in your housing costs, but that's the deal for the next generation.

This is not to say bandit capitalists like Romney shouldn't be paying penalty tax rates of ~50%. If we doubled their rate to 48% that'd yield another $400B or so. We could use the money to get the deficit under more control.

http://research.stlouisfed.org/fred2/graph/?g=q0u

(gov't deficit spending)

turtledove says

But when you think of the 1% who are made out to be the super-rich who are not paying their share, does my situation really strike you as the same as Mitt Romney, for example? He pays a much lower percentage in taxes than we do. We're progressive to a certain point (and type) of income... Then, it goes the other way.

You and I pay higher rates % on Salary earned..

Romney has no Salary! He has no employers to be paid from !

He isnt on anyone payroll... So he doesnt pay a higher rate...

One day as you, I and other retire or no longer employed.. WE will

be paying a lower rates... you will be living off savings ! or least that

is the plan for many!

Bellingham Bill says

This is not to say bandit capitalists like Romney shouldn't be paying penalty tax rates of ~50%. If we doubled their rate to 48% that'd yield another $400B or so. We could use the money to get the deficit under more control.

Double on what ? salary, savings, dividends, assets ?

Bellingham Bill says

It's my thesis if we lowered taxes on the top 5%, Irvine prices would just rise to take the tax cuts, since each household -- at every level of the 'property ladder' -- takes their after-tax income and bids up the cost of housing with it.

The money in taxpayer pockets would go to all the things that people want to buy. Your thesis essentially asserts that people spend all their money on house payment, and don't care about other aspects of their lives at all.

Bellingham Bill says

That's OK for you, since you've locked in your housing costs, but that's the deal for the next generation.

No, it is not. See above.

Bellingham Bill says

This is not to say bandit capitalists like Romney shouldn't be paying penalty tax rates of ~50%. If we doubled their rate to 48% that'd yield another $400B or so. We could use the money to get the deficit under more control.

No. The deficit is the result of spending. The more taxes collected, the more the government budgets would be larded up with long-term contracts to cronies, resulting in even more precarious budgetary problems down the road.

The money in taxpayer pockets would go to all the things that people want to buy. Your thesis essentially asserts that people spend all their money on house payment, and don't care about other aspects of their lives at all.

They do, but housing is a very high priority.

http://research.stlouisfed.org/fred2/graph/?g=q0w

real per-capita (25-54) housing costs.

(this is spot-on with my own experience; btw, what I rented for $700 in 1991 ($1100 in 2012 money) rents for $1800 today, a 1.6X increase in real terms).

The more taxes collected, the more the government budgets would be larded up with long-term contracts to cronies, resulting in even more precarious budgetary problems down the road

Sure, if we elect another chucklehead like Reagan or "W".

http://research.stlouisfed.org/fred2/graph/?g=q0z

Reality says

We are not talking about a single guy living in his mom's basement while being paid to make online posts

Thanks for clearing that up.

Reality says

Doctors are supposed to be one of the admired professions.

They still are.

Reality says

5k/mo is barely enough to put one kid through private high school or college.

And if you choose to live in Irvine, you can only buy a Lamborghini once every few years. I guess that's a sacrifice you have to make.

Bellingham Bill says

No, just showing housing has totally outraced inflation, demonstrating my point that it's not like other expenses.

No, all you have shown is that the official "inflation" under-states some components of expenditure in real life, and housing seems to be one of them. If you graph medical expense or education expense, both would have out-raced "inflation" even more. Heck, even the cost of real food / organic food would have out-raced "inflation." In the case of housing, I'm not even sure if it is our-racing inflation: the graph you have is not adjusted for quality or quantity consumed. People live in much bigger houses today than they were in 1950's. By your way of graphing, even people's expenditure on electronics goods would have out-raced "inflation" . . . and we know electronic goods prices have definitely deflated in the last half century!

Bellingham Bill says

When households started making 2 incomes -- and banks started lending against that higher household income -- housing prices skyrocketed.

Along with the prices for many other items, including medicine, education and real food (organic food, but industrially produced substitutes). The average houses also got much bigger with more amenities during that time (the graph is not just housing but also utility, which is a reflection of energy cost and electricity/gas monopoly surcharge "distribution fee"), unlike education getting worse and real food staying more or less the same.

Bellingham Bill says

Other goods aren't in such short supply and not so critical to survival and quality of life as housing. No good is, really, since housing even determines how well your kids grow up etc.

Do you want to try giving up food or medicine? As for kids, upper middle class bidding up prices for houses in good neighborhoods is only a reflection that high taxes and inflationary transfers have already deprived them the capacity to send kids to private schools away from home.

Bellingham Bill says

As for the partisanship talking about the national fisc, this is because the last 4 Democratic presidents have been rather serious about paying for government, while "You know, Paul, Reagan proved that deficits don't matter" is the Republican belief.

It's a two sides of the same scam. Both deficit spending and raising taxes increase the Economic Rent collected by the privileged at the expense of the rest of the society, at gun point. Two wings of the same political party.

tatupu70 says

Reality says

5k/mo is barely enough to put one kid through private high school or college.

And if you choose to live in Irvine, you can only buy a Lamborghini once every few years. I guess that's a sacrifice you have to make.

We are not talking about Lamborghinis, we are talking about sending kids to a good quality private school, just like the good doctor himself probably had when he was young. If the good doctor and his family can not afford to live in Irvine, who should be able to? Only government bureaucrats, banksters and other gang-bangers in and out of bureaucratic costumes?

you bring this on yourself by living in high mortgage districts to exist in a tiny dump. Move to stockton and quadruple your disposable income.

turtledove says

Yes, this is California, the land of insane house prices. Irvine doesn't have much 4-bed product under $1m (and that's a tiny dump). I'm not saying that we're poor. But when you think of the 1% who are made out to be the super-rich who are not paying their share, does my situation really strike you as the same as Mitt Romney, for example?

Reality says

We are not talking about Lamborghinis, we are talking about sending kids to a good quality private school

No. I'm talking about Lamborghinis and you were talking about private schools.

Reality says

just like the good doctor himself probably had when he was young.

Really? All Drs. went to private schools? Please tell me more.

Reality says

If the good doctor and his family can not afford to live in Irvine, who should be able to?

The good Dr and his family clearly can very comfortably afford to live in Irvine. They have more $$ left AFTER taxes, housing (in Irvine no less), and health care than what the median family has BEFORE all expenses. I think they have no problem being able to afford living in Irvine.. Don't you agree?

VERY dishonest.

From the article: "...when it comes to individual income taxes". So that's NOT considering payroll/social security taxes, sales taxes, etc, etc.

If 80% of payroll taxes come from the bottom 50%, and I make a headline "Rich don't pay most of the taxes - 80% of taxes come from the bottom 50%", you'd call me a liar because I'm only considering one part of the overall tax structure and then claiming that it is true of taxes overall. What this article, and the O.P. has done, is just as dishonest.

tatupu70 says

New Renter says

$5k/mo ain't bad! Your non-shelter related bills shouldn't amount to more than half that. That leaves you with at least $30k/yr

I agree--$5K/month after taxes, housing, health care is a LOT. If someone is crying about that, they need to have their head examined.

You must not have children. 5k won't spend you very far these days. Its by no means filthy rich

tatupu70 says

No. I'm talking about Lamborghinis and you were talking about private schools.

Your Lamborghini is utterly irrelevant to this discussion. The good doc and his family is not into Lambo. Stop projecting.

tatupu70 says

Really? All Drs. went to private schools? Please tell me more.

Can you not distinguish "probable" vs. "All"? In any case, the salient point is that doctors in previous generations were able to send their kids to private schools, with money to spare for the family to live decent lives.

tatupu70 says

The good Dr and his family clearly can very comfortably afford to live in Irvine. They have more $$ left AFTER taxes, housing (in Irvine no less), and health care than what the median family has BEFORE all expenses. I think they have no problem being able to afford living in Irvine.. Don't you agree?

No, not "very comfortably." The $50k or so that you are implicitly referencing is median pre-tax income according to income tax filings, not median net income after taxes and welfare transfers, nor including any of the zillions illegal incomes, under the table payments and legally tax sheltered wealth accretion that technically are not even considered "income."

In case you did not realize, many welfare family pay nothing for taxes, housing or healthcare. So the good Doc's income is reduced from $250k to $50k for essentially nothing more than bringing up to the baseline of a welfare family. The welfare family would also have food stamps, whereas our friend Turtlelove has to spend her own money feeding her family. The illegal pharmacist (aka "drug dealer") may well be able to provide more for his pretty girlfriend than the Doc can do for his beautiful wife and family on W-2 income. That's how sad our system has become.

bdrasin says

VERY dishonest.

From the article: "...when it comes to individual income taxes". So that's NOT considering payroll/social security taxes, sales taxes, etc, etc.

If 80% of payroll taxes come from the bottom 50%, and I make a headline "Rich don't pay most of the taxes - 80% of taxes come from the bottom 50%", you'd call me a liar because I'm only considering one part of the overall tax structure and then claiming that it is true of taxes overall. What this article, and the O.P. has done, is just as dishonest.

The bottom 50% gets far more SS payouts over a life time than they pay in in payroll taxes. Remember, "Saint FDR" told you paying into SS account is your own money. LOL. Please don't have selective memory now.

Reality says

Rent income is always privatized . . . because all goods and services are ultimately privatized: a piece of food in my mouth can not be swallowed by you. The only difference is whether:

It's not who consumes the resource, it's who produces it. No one created the land, the EM spectrum, the mineral and chemical resources mined. Such exploitation of public goods should benefit the public. No one should get rich simply by "owning" a mine. The miners, those producing wealth by extracting the minerals, should get rich.

Reality says

There is no such thing as "public" when it comes to limited single-use/mutually-exclusive-use resources.

A single piece of coal is consumed by an individual, but the profits should go to the public since no individual made that piece of coal and to the miner who mined the coal.

Dan8267 says

Reality says

Because Berners-Lee was working for a socialist institution.

If CERN is a "socialist institution" than so is the U.S. military and we should get rid of it.

From your silence, I take it your answer is, "Shit, I forgot that I love socialism when it pays for things I want.". That's the typical fair-weather capitalism hypocritical answer.