Middle Class
 

ok, hopefully we can have a civil discussion....(yea right)

So from the Dems I hear a lot of the "empowering the middle class" speak. In Phil Angelides succession speak last night he mentioned this again and how he still would like to "see the middle class empowered...a California for the many, not the few"

So the question is what is middle class?
From where I sit they/me look to be doing fine. No empowering needed. The working poor are the ones that need help, but I don't see anyone taking up their cause...just the cause of the middle class.

From wikipedia
"As mentioned above another theory attempting to define the vague intellectual concept that is the middle class, states that only professionals and those who would otherwise be considered upper middle class are actually middle class. According to this theory the vast majority of Americans are identified as being working class while the middle class is seen as a modern petite bourgeoisie.[3] Today many experts and writers state that the middle class or at least those with lifestyles indicative of the American middle class constitutes only a minority of the population,[6][1] and is in terms of privilege and influence closer to the top of society than the bottom or the working class majority. In this case the middle class consists of professionals who are largely paid to conceptualize, create, and manage and therefore have some degree of influence of the workings of society and their organizations.[3] These professionals usually have incomes that rank considerable above the average wage and have had the benefit of an advanced post-secondary education, which also entitles them to a high degree of economic security.[3] This theory defines the middle class as being in the middle between the top and the working class majority in terms of power, education, and wealth. Recent studies indicating that the actual middle of the income strata cannot afford the lifestyle indicative of the middle class has lend support to the notion of the middle class as a quasi-elite.[6]


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According to this chat middle class is $40,000-$100,000. I'm not sure people with that kind of income are that bad off. Other charts show middle income at $34,738. So when they talk about tax breaks for the Rich, their talking about people who make more than $34,748??? (Not exactly Rockefeller money)

Any insight?

The 'rich' who were the primary beneficiary of Bush's tax cuts were the top 1%-ers

Since the rich disproportionately pay the vast majority of taxes in the US, i would suspect that they would disproportionately stand to benefit from any tax cut.

Beyond that, your comment is just a meaningless talking point with no basis in reality whatsover.

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Specifically, how so?

$40k-$100k HOUSEHOLD is not that much money.

Try to afford your "average" 2.2 kids, housing costs, heating/utility/grocery costs, clothing, vehicle/fuel/insurance etc. on $40k a year. Good luck.

Bottom line on how the middle class is doing is what they are left with when the bills are all paid....

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Do you realize that if you are a middle class single guy making say $70-$90k/yr, your marginal tax rate is 40% , before the GoP(Greedy Ole Party) got ahold of the guvt. The marginal rate for a say $300k earner was around 38%, currently it is 33% for a less well off $146k earner it is 28%. That's what the GoP did for all you middle class guys. So much for progressive or even falt tax ideas.

Back to the original question, what is considered middle class, at least here in the US?

In England, it used to be business owners and mover and shakers who were still only 'commoners'. It was more social than economic in nature.

Would you consider someone who is in a Union, and paid in the $80K region middle class or working class? What about a civil engineer making $40K? Are they middle class or working class? How about a teacher making 30K per year? Middle class or working class?

I'm living it everyday. Not on $40,000-but not over $100,000 either.

Also depends on where you live. My sister-in-law in Idaho and her husband are in the $60,000 and the do quite well.

Thom,
I actually did benefit fromt the tax cut. Capital gains/qualified dividends in my bracket went from 28% to 15%.

So I droped 3% in income tax and 7% in Cap. Gain/Div tax. Every little bit helps.

very true, also your lifestyle choices

I'm all for the 15% on capitol gains and dividends, why not on interest.
bottom line though most in the middle class recieve so little of either that it's meaningless as far as their lives go.

You got 3% and are thankfull while the guy making 2 -5 times your income got double that %, multiplied but his income, that's some real coin in his pocket.

Bill,
You ever run into something called the AMT? It's not pretty. I guarantee that a couple making more than 140K/yr is getting more po'ed every year. Especially, if they are paying a huge mortgage and not getting to deduct any of it.

Bill,
I don't have a problem with his reductions from 39.6% to 35%.

In fact, I wouldn't care if we all paid just 20%. If Bill Gates makes a gazillion dollars and I make $80,000, hey we both paid 20% to the common good. Not his fault he figured out how to make a gazillion while I could only muster $80,00. More power to him. Why should he have to carry more of a burdon than me?

Middle class is subjective and varies depending on who is defining it. there is no clear cut definition that I know of but generally speaking, take a look at sniper's pie chart. Middle class would be the ones in red, with an income below $70,000.
BTW, they don't pay much taxes.
The top 10% (the group I fit into) pays a heck of a lot more than the lower, middle, and upper middle class pay altogether. the top 10% pays 2/3rds of all the taxes collected while the other 90% of al people in the US only pay 1/3rd.
Your welcome.

AMT usually hits when you have a lot of deductions, not me.

I have a huge problem when my marginal rate is bigger than some guy w/ 3x the income:mad:

A single guy making 70-90k a year around here(philly) is HARDLY middle class.

That would be more around 30-50k.

70-90k per around here is a house in the burbs and a new car in your drive....ie, UPPER middle class.

For myself(and i AM middle class), i have definitely had less taxes taken out of my earnings since the cuts.

Plain and simple.

This is probably because the middle class pays SO LITTLE of the US income tax, whereas the upper classes pay the vast majority of it.

The top 10% pay almost 65% of all income tax in the US(see my little pie chart above).

The bottom 50% of earners pay a whooping 5% of the national income tax.

So in that light, how CAN they see a huge gain even from a massive tax cut?

Answer: They can't.

Wait a minute, hold the phone...

tc-sacto, you have a supercharged boxster?

Do you have any engine pics online? A technical write up? Do tell......

If true, who cares?

again who cares?

Lets talk only fed payroll tax no deductions or dependents, just to keep it simple

$70k earner will have ~$24k in taxes taken form his pay ~34.3%
$300k earner will have ~$83k taken from his pay ~31.6%

These are the effective rates 34.3% vs 31.6%. Now consider that the first $20k is necessary just to put food on the table and a home to put the table in, Doesn't leave much for fun stuff or heaven forbid savings and investments does it.

A huge part of the reason many have no savings is explained by the tax rate inequity.

There is class warfare in this country and it is being successfully waged by the haves against the wanna haves.

Besides me? Apparently you....you brought it up.

Neither one of them are poor(or even remotely close- well, around here anyway) or hurting, so i dont much care.

I live on under 40k a year (primarily because i dont feel like killing myself working lots of hours) and have a porsche and always have a few bucks to buy toys for myself.

I simply dont know where you get off crying poor at the income levels you are talking about.

A huge part of why people have no savings is because people are largely short-sighted morons. That's also the primary reason so many people are in so much credit debt.

I think you're wrong because all any "wannahave" has to do to become a "have" is work harder or go get an education(federally subsidized, thank you very much).

I think that most of you folks wouldn't know what poor was if it bit you on the assss....

Poor is growing up in a cockroach infested row house in a single parent home with no car and living off a household income of (at the time) about $10k a year, in inner city philadelphia, like i did. I pulled myself out of it(and so did all of my siblings), and there is nothing remarkable about me(or us) at all.

If i did it, anyone can do it. It's just a matter of doing what it takes, and putting in the hard work to get there.

Unfortunately, there is an entire welfare class in America that is more interested in the ghetto life and driving brand new Beemer's and sporting designer clothes and jewelry despite living in a (literally) $5k dollar decrepit row house in the drug and violencen infested hood that we ALL have to pay for.

Eliminate the burden they pose, and we'd all have a lot more money for go-fast parts for our P-cars.

Of course there is always the option of tax evasion...which most Americans do as much as possible anyway, so in reality, very few of us actually pay what we're 'supposed to'.

But in closing, at 70k a year, for what a single guy pays in taxes, he really has no room to gripe, cause unless he is a moron, he is living a pretty daggone good life.

Wow, you guys must be using a different IRS rule book than I am.
Over the years my tax rate has gone up as my income went up.
The percentage kept going up, up, up, yet you think it is going the other direction. How come?

Besides, if you think the wealthy have it so easy, why don't you become wealthy? All you have to do is pay attention in school, get very good grades, go to a local community college for two years, transfer to a state run school with very good grades (working at night and on weekends to pay your bills), study a real subject and earn a degree that that does not have the word "liberal" or "arts" in it. Get a decent job and work hard to about 25 years until you are at the top of your game. No teaching, only full time jobs apply. For at least 10 of those 25 years take additional college courses at night so you can get another degree, maybe an MBA.
Make sure you set aside at least 12% of your gross income for those 25 years so you have something to rely on when you retire.
After all that you will be considered wealthy and you will have the privilege of paying twice as much in taxes as those who took the easy route.

if that's too much work or too hard or if you have a list of excuses why you can't do all those things, then just sit there and complain that it's not fair that someone who did all those things only pays most of your share and not all of it.

Why? If you make $60K/year and pay 15% or $9K in taxes and another guy makes $600K/year and pays a 10% rate and pays $60,000 in taxes, do you not think he's paying his "fair share"? He's paying as much in taxes as you earn and he's still paying almost 7 times as much in taxes as you. What's his "fair share". How much more schools, roads, national defense does he use than you? That is my fundamental problem with taxes. The rich guy gets a 10% tax break to 9% and he still pays $54K in taxes and you bit(h cause he got more tax cuts in absolute dollars than you, even though he still pays almost as much in taxes as you earned! I think its very unfair that Bill Gates pays hundreds of millions in taxes (and I believe he does). Do you have kids in school, now or ever? The fact is that the average working joe doesn't even pay enough taxes to educate his own kids in K-12. In CA we pay about $7,000/kid to educate in K-12. If you have two kids, thats $14,000 in tax money for school, let alone police, fire, roads, flood control, etc. Most people don't want to face this little fact. So who actually pays for all those middle class and lower kids to go to school, and all of the other government services you get? Answer... the Rich.

Excellent post Sammy.(yours too Hugh, lol)

Because many believe it should be "to each according to their need, from each according to their ability."

Wow Sammy, its like you read the history of my life, except for the putting aside 12% part. I can't seem to make that mark, but I try to get close. Yep, left before graduating high school as the son of a coal miner who died of black lung when I was 16, joined the USMC at 17 and was a forward observer for the 8" howitzers and 175 mm guns by the time I was 18. For those of you who never served, the attrition rate of forward observers was about par with being a tunnel rat, but I digress.. got out with an honorable, put myself though college between the GI Bill and working full time, graduated, worked full time, got an MBA at night, and the dems. call me a lucky sperm....

Well there are a lot of Communists/socialists out there.

The rest of us would rather cut your arm off for STEALING off us rather then support the lazy and stupid so that they can have a free ride.

BTW, in case you had not heard, Communism is a failed ideology.

You want to donate YOUR money, go for it.

You want to STEAL my money....well....there's gonna be a fight.

Fire mission, target, socialists in open, Golf Lima 695 094, direction 159, adjust fire, over. ;)

Good going Hugh. Sounds to me like you've earned it, even though others will say we just had more opportunities.

I didn't serve in the military, I was waaay too rebelious back then and fought authority at every turn. I wouldn't have made it through boot camp. I did register for the draft though.
Luckily for me we this country has plenty of brave souls that have served in my place, my thanks to all of you.

Refresh my memory, who said that? was it Marx, lennon, Stalin?

if you make over 20 million a year, why do you need a tax break?

even 2 million a year.... i'm sure a family earning 50K , 2K savings is a big deal.
To a FAT CAT on Wall St, or a CEO earning over a million a year, a tax break is 20-30K . I'm sure they just upgrade their yatch.

so in conclusion, take away the tax cuts from the rich (earning more than 1 Mil AGI) and give more to middle class, to offset rising costs, ie. medical insurance, RE taxes, gas prices, etc.... give the money back to the people that actually NEED it. simple as that.

Bill apparently has "new tax math". Or both of our accountants are worth poo-poo...

I guess my point is that if people had a better understanding of where government revenues come from they might like a little smaller federal deficit, especially if the middle class actually pulled their weight in terms of what they actually pay and actually get, but hey! as long as we can tax the rich and they'll pay for it who cares. I believe most democracies that have failed did so because the middle class figured out that they could continue to tax the small (rich) percentage of the population to fund the middle class life style. The thing many people forget are the two most fungible things in the world are people who know how to make money, and people with money.

Apparantly you and or your accountants don't know what a payroll tax is

Income tax + ss tax + medicare tax = payroll tax


and don't try to make the sale that ss & medicare aren't really taxes, it all goes to the same pot and is spent immediately on wonderful things like cheese museums and bridges to nowhere

your effective tax rate is what you get when the sum of your taxes is divided by your net

Dig out your tax forms from last year, don't forget that if you are not self employed your boss paid 7.65% more of your taxes on all earned income up to $94.2k, if self employed you already know and aren't likely to forget what you paid.

Just a concept. Market clearing price equals what your boss pays to hire you, this includes your salary, plus all the Bill mentioned above including ss tax (the employers side) + medicare+medical insurance+ retirement (if paid) +anything else they pay. And here's a jolt, you paid the employer side of social security, not your employer.... why you ask? because its part of your employers cost of hiring YOU. Again, take econ 101, if you don't believe me. Since its part of the market clearing price of employing you the employers side of SS is part of what it cost him to hire YOU.

Lower middle is probably about $20-40K, upper middle $60-80K.

These incomes shrink when you are paying college tuitions on a couple of kids.

Why are college tuitions so high? That's a scandal in itself.

Annual income is not the best measure of "class". Net worth is a much better indicator of wealth than income but that would be much harder to track.

Should we as a society give those less fortunate a helping hand? Yes.

A hand out? No.

Oh yeah, cause that's perfectly just, right mr. Marx?

How bout we just take your Porsche instead?

Got a problem with that?

All of your fat cat socialists....tommorow morning i demand that all of you sell your porsches and immediately go out and buy food and distribute it to the needy in your areas.

If you do not, we will come put you in prison for Porsche tax evasion.

Your little socialist plans sound pretty effin' sucky now, dont they?

Closet Chic' Commies.

I'm with Sammy and m21sniper on this one.

From the SSI website:

The OASDI tax rate for wages paid in 2007 is set by statute at 6.2 percent for employees and employers, each. Thus, an individual with wages equal to or larger than $97,500 would contribute $6,045.00 to the OASDI program in 2007, and his or her employer would contribute the same amount. The OASDI tax rate for self-employment income in 2007 is 12.4 percent. (Tax rates of 1.45 percent for employees and employers, each, and 2.90 percent for self-employed persons, are applied to all earnings—without a taxable maximum—under Medicare's Hospital Insurance program.)

Hence, all persons earning over 100K continue to pay additional taxes on higher income amounts.

Does the reduction in SSI tax result in a lower "net" tax rate? Only if you consider this simple math. You forget that the AGI can result in significant decreases in income tax rate (4% would be the start) with a resulting reduction in your "net' tax rate. You no longer have access to those deductions if you meet criteria as someone who is taxed under the AMT. I grant you, that you can (as a business owner) find a way to reduce your AGI to levels where you may not be affected by the AMT, but if you are a w2 or 1099 earner that won't be the case.

Here is a graph of effective Federal payroll tax rates for a single individual,deductions are left out.
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Where do you all fit?