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TAXES: Rates are historically low

Letter by Ruth C Crook, Tacoma on Dec. 13, 2010 at 3:13 pm with 37 Comments »
December 13, 2010 3:13 pm

Re: “Stop class warfare, Democrats” (letter, 12-10).

The writer asserts that a 36 percent or 39.6 percent marginal tax rate for families making more than $250,000 or individuals making more than $200,000 is so prohibitive that people will stop working. If they can afford it, that would be great. It would free up those jobs for people who need them.

In 1980, my husband and I together made just over $50,000. We didn’t have to worry about the wolf at our door, but we certainly weren’t rich and we had six children to support. After itemizing our deductions and claiming two personal exemptions and six dependent exemptions, we were in the 54 percent bracket. We were not tempted to quit working.

In years past the marginal tax rate has been as high as 91 percent. With rates as low as they are now I have no patience with whiners.

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  1. aislander says:

    No one is talking about “whiners.” In fact, I don’t recall EVER seeing a letter from someone complaining about his personal tax situation. The question is: what is good for the country? I contend that allowing people to keep their own money to use for their own priorities rather than having the government confiscate it to pay for ITS priorities IS good for the country. And the fact that the percentage of GDP that the government receives in revenues doesn’t change with rates supports that contention…

  2. Send in that 54 percent and don’t let me hear you whining. I’m letting you off easy by comparison with years past. I have no patience with those who refuse to pay their fair share of taxes.

  3. Just because in the past marginal rates were 91% doesn’t make it right. Any money legally earned by an individual belongs to that individual to support themselves and their family. The government has the right to levy a tax, I agree, but they do not have the right to levy a tax that is unnecesarily high.

    I applaud you for continuing to work. Isn’t it great that the powers that be have seen the wisdom of reducing the tax rates. Imagine what a family making $50,000.00 can do with the money they get to keep.

  4. The question is: what is good for the country?

    Jobs.

    A balanced budget.
    Yes – spending is a problem BUT there must also be an increase income.

  5. What is good for our country is to control our spending so that the lowest tax revenue is required. If increase revenues are required we first look everywhere to cut spending before we ask any taxpayer for one dime of their hard earned money.

  6. aislander says:

    beerBoy writes: “…BUT there must also be an increase income.”

    Since revenues barely change as a percentage if GDP in response to a change in rates, the ONLY way to increase income is to increase GDP…

  7. sumner402 says:

    Whats good for the country?
    The middle, when we had one, but the GOP has fought hard to eliminate the middle class from the American landscape.

  8. UnbiasedReporter says:

    Well Ms Cook:

    “In 1980, my husband and I together made just over $50,000. We didn’t have to worry about the wolf at our door, but we certainly weren’t rich and we had six children to support.”

    Making $50K a year in 1980 put you in the top 5% of income earners. The AGI for the top 5% started at $43,792. Top 5% – that made you rich according to today’s stance.

    “After itemizing our deductions and claiming two personal exemptions and six dependent exemptions, we were in the 54 percent bracket.”

    And if you were actually paying 54% (with all the tax shelters and deductions back then) then you needed a better accountant. The average tax rate PAID by the top 5% of income earners in 1980 was 26.85%.

    http://www.taxfoundation.org/news/show/250.html

  9. First_Lefty says:

    Oh….well if the “tax foundation” say so…..it’s true…..LOL

    My observation is that if the 5% bracket has moved from $50 to over $250K in 30 years, there is something wrong with the entire economic system.

    Of course, my house, in 1980 appraised for $60K and that house would be about $275K today.

    Bottom line – regardless of earnings or tax amounts, some people will always complain because they are not part of the solution, just part of the problem.

  10. bobcat1a says:

    “Top 5% – that made you rich according to today’s stance.”

    No darling, top 2% is the cut-off for extending tax cuts. Try to remember that. $50,000 in 1980 was the equivalent of $132,000 in todays dollars. Far cry from $250,000, the top 2%.

  11. redneckbuck says:

    The top 10% of earners pay 70% of all taxes. Let’s push it to 90% and see what happens.

  12. First_Lefty, I have to correct you. My father was a chemical engineer and he always said, “If you are not part of the solution, you are part of the particulate.”

    Seriously, the problem with our economic system is: inflation. The Federal Reserve and Congress have colluded to debase our currency and reduce the purchasing power of the dollar.

    Unless one adjusts prior year money values for the amount of inflation, any comparisons between years will be misleading.

  13. 14% of Americans are below the poverty line. Let’s push that to 35% and see what happens.

  14. sumner402 says:

    I see the right has nothing but slogans and talking points.
    I wonder if they even think about or know how meaningless those are?

  15. Sumner402’s guys, Presidents Obama and Clinton recently held a joint news conference and both argued to retain tax rates instituted by President Bush.

    Both argued retaining the current rates would help “stimulate” the economy and increasing them could push us into a double-dip recession.

    Listen to liberal icons and learn something!

  16. nanook, both presidents said the tax cuts for the middle class is how you describe it. Obama said the price of getting the tax cuts for the middle class was the compromise he worked out on the 2 yr extension for the wealthiest. He has said over and over again that the extra cuts for the wealthiest has not done anything for our economy and only raises the deficit. He says he will fight them in two years and will not allow them to be passed into law because they are so harmful.

    If you listen, and quote, carefully, you will not have to make up your own lies about what was really said.

  17. redneckbuck says:

    Even when our economy is really cooking 5% of the people do not work, or are unemployed.

  18. redneckbuck says:

    Industry has to make a come back in this country. A combination of decent wages and a product that people want at a fair price is the only way to make things right.

  19. sumner402 says:

    Presidents Obama and Clinton recently held a joint news conference and both argued to retain tax rates instituted by President Bush.

    That doesn’t make it good economic policy.
    Everyone knows it’s bad policy but no one has the guts to do anything about it.
    900 billion added to the deficit, why aren’t the tea whiners raving and foaming at the mouth over that?

  20. “14% of Americans are below the poverty line. Let’s push that to 35%”… isn’t that the leftist strategy?
    Increasing incentives not to work is how the left increases it’s constituency.

  21. redneckbuck says:

    Wait…..a good product at a good price is great for jobs…..but then there is that nasty profit thing and an owner making lots of money. It is just easier to keep unemployment high.

  22. If you made $50,000.00 in 1980 what are you making now. If you are still working at the same job it must have increased substantially. Sounds like you’re the whiner.

  23. Increasing incentives not to work is how the left increases it’s constituency.

    But….how does that square with that whole evil Unions donating to the Dems rhetoric?

  24. What is the first thing the credit counselors do with a new client? They take all the credit cards and cut them in half right in front of the client.

    Now here we have Barry Bigears lying by saying that lowering tax rates contributes to the deficit. Crap. It’s the continued use of that Chinese credit card (treasury bonds) to pay people to not work and to pay lousy technologies to stay lousy (ethanol from corn).

    January 5th is when the credit card gets cut in half. It will cause a lot of pain but the patient (America) will get better faster.

  25. sumner402 says:

    January 5th is when the credit card gets cut in half.

    I’ve got a bridge I would love to sell you!

  26. BlaineCGarver says:

    Ah, dear letter writter, you wear your chains lightly, and ever so softly kiss the hand that throws you a crust of bread after you have given your life’s blood to your master.

  27. blakeshouse says:

    It is amazing to me how the lib socialist/neo marxists feel that every penny EARNED by everyone belongs to the Govt and it is up to the Govt to determine just how much you will be deemed worthy of being able to actually keep.

    Not a single person I know has a problem paying their fair share of taxes, but when the top 5% of earners has to pay over 50% of the taxes something is wrong!!! Add to that the fact that a huge percentage is going for the entitlement programs that foster the dependence on govt. All you have to do is look at Europe. The same socialistic garbage being foisted on the American people is the same crap that the Euros fell in love with over the yrs, payed for by the outrageous taxes. Now that the entitlements have bankrupted them and they have to make these serious choices, the gimme class is rioting in the streets.

    Tax increases could be implemented if we could trust those in D C to NOT go against the will of the people and keep adding these asinine social projects. Return the Govt to what it was designed to do and get rid of the rest .

  28. It would be nice if you guys, lefties and righties, actually knew something about historical tax rates and deductions. Without getting into corporate tax law, abusive tax shelters and the like, get your hands on old copies of Publication 17 and review the deductions and credits, the expansion of the earned income tax credit, etc. Go to the Bureau of Labor statistics and plug in the income for whatever year you want and look at the 2010 equivalent.

    The only people really getting screwed now are those without children and a paid off home or an apartment dweller. The poor are on entitlements; the rich have favorable tax rates and deductions to shelter their tax burdens: and the middle income people with kids have been sheltered by the expansion of credits.

    It seems absolutely no economic class wants to be responsible for paying anything. Their fair shares are zero tax rates with refundable tax credits for all.

  29. What is the definition of middle class? Someone please give me the dollar amounts that define, Rich, Middle Class and Poor.

  30. Red ‘industry has to make a come back in this country’ All too true, and the Bush tax cuts were suppose to stimulate the economy and job growth in this country. Alas, the stimulation and jobs were sent overseas.

    Raising tax on the ‘rich’ may work better. Back when the top rates were over 50% business owners had a very powerful incentive to leave money in their business in the form of better wages and benefits for their workers, upgrades and modernization of factories, and research and development etc.

    At the least, if DC can reduce spending, the increase revenues can be used to pay down the national debt.

    5% unemployment is better than 10% unemployment. And the10% figure does not include underemployed and those no longer receiving unemployment benefits.

    It was the lust and greed of the business owners for higher and higher profits that sent our jobs overseas in the first place. Remember the golden mean; too much of something is as bad as too little.

    Also, who’s going to buy all those wonderful, cheap, foreign made products if we don’t have well paying jobs in this country?

  31. BGC, the top 5% earn over 80% of the taxable income, so their fair share should be above 50%.

    Sincere, historically the dollar amounts have varied, but currently is taken as $200,000 between the middle and upper classes.

    The upper class: The highest socioeconomic class in a society. The Upper cclass is most commonly described as consisting of those with great wealth and power and may also be referred to as the Capitalist Class or simply as The Rich.

    Middle class: The socioeconomic class between the working class and the upper class, usually including professionals, highly skilled laborers, and lower and middle management.

    Working class: The socioeconomic class consisting of people who work for wages, especially low wages, including unskilled and semiskilled laborers and their families.

  32. “Since revenues barely change as a percentage if GDP in response to a change in rates, the ONLY way to increase income is to increase GDP… ”
    5% change is pretty meaningful….it went from around 30% in 2000 to about 25% now, according to the OECD.

    Wall street recorded record profits last year, and is on track for it’s second best “performance” ever….

    A conservative friend once told me that human nature is the reason socialism didn’t , and can’t work. He’s correct. That’s also the reason Laissez Faire Capitalism didn’t, and can’t work.

    The blended economies developed over the last century have provided far better living conditions for far greater numbers of people than either system ever did in a relatively pure form.

    Compromise is NOT a bad thing, and principles should be a guide, not an excuse. Fair wages AND ROI is good, excess should be avoided, in all things

  33. PumainTacoma says:

    I think people just want to know if they are getting their fairshare from the tax dollars they pay. Do you feel someone who pays $251 a day (yes a day in taxes; Federal, Utility and Property Taxes) should be upset? I do. After the Feds eat up 33-35% of your income, the city comes in and raises your utilities and your property taxes are sky rocketing. Then some ask you to give more. My family gives and pays plenty. Some of us are trying to save for our retirement so we do not have to ask the unemployed to pay for us when we retire or ask the government to feed, cloth or bathe us. So yes, people have a right to be mad as hell and rightly tell the politicians that we are not going to take it anymore. Keep your cash. Stop the hand-outs. And stop buying mesh back, swivel $10,000 chairs at city hall.

  34. PT –boo-hoo. Cry me a river.

    Why is it that people who pay more in taxes that most hard-working Americans earn before taxes are such victims?

  35. If you are telling the truth then you are pulling in around $260K a year, of which, about $170K is take-home.

    If you can’t manage to invest enough of that in retirement to get along then maybe you should look at how you are wasting your resources.

  36. for comparison, the average American income is around $50K, the median income is around $70K

    So again……cry me a river because you “only” take home $170K.

  37. $170,000 per year, poor baby will have to settle for the Cadillac SUV instead of the Porsche.

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