Posted on 12/10/2012 7:56:08 AM PST by Kaslin
I was shocked by something I heard from one of my friend’s sons the other day. He is a college graduate with a business degree and fortunately has a job. We were all talking about the fiscal cliff and how it would affect people making over $250K a year. His reaction to the top rate rising to 39% along with the California State tax increase due to Proposition 30 prompted him to say, “Whew, I think I dodged a bullet! I was up for a promotion with a pay raise but someone else got it. I’m pretty sure my taxable income will be under the level where I would have gotten punished.” PUNISHED.
He was basically saying that he would rather earn less and stop advancing in his career than be hit with massive taxes. I asked him to explain and he said that basically he didn’t want to work and then fork over 50% or more of his earnings to the government. He said that he had gone to school, studied hard and gotten a job but was still burdened with excessive student loans and he felt that with that hanging over his head he couldn’t afford to pay more in taxes.
As for buying a home and starting a family, well that was not even an option for him. He said that if they were talking about taking away the mortgage home deduction then why buy a house anyway?
This is where we have come in this country. It is now a better option to take a lower paying job, rent a home or live with mom and take government benefits than it is to climb up the ladder to success. The American dream is fading folks. Like an old photograph from a Polaroid instant camera, the picture is slowly disintegrating.
Our entitlement society is out of control. It is a sad fact that a head of a household of four making minimum wage has more disposable income than a family making $60,000 a year. In an article in August 2010 this issue was discussed in The National Review.
“In many cases, economists have calculated, welfare recipients who enter the work force or receive pay raises lose a dollar or more of benefits for each additional dollar they earn. The system makes fools of those who work hard.
“Recently the chairmen of two important subcommittees on Capitol Hill convened a hearing on this issue. The hearing elicited some revealing testimony from one of the chairmen’s congressional colleagues.”
“The more benefits the government provides, the stronger the disincentive to work,” Representative Geoff Davis (R., Ky.) pointed out. The great irony, he added, is that although federal welfare programs “are designed to alleviate poverty while promoting work,” collectively they have “an unintended side effect of discouraging harder work and higher earnings.”
Less work and lower earnings, in turn, translate into greater dependency on the government — and zero or even downward social and economic mobility for those mired in poverty.”
Working women who are single with children often forego a raise because it would push them into the dilemma of losing Title 20 daycare if they made more money. There are over 70 Federal welfare programs right now and the list will continue to grow under Obama. If a person works and climbs the ladder, they will become disqualified for these programs and lose all of the benefits that they have become so accustomed to.
This creates a moral dilemma. When good people continue to stay on unemployment because taking a job would not pay them as much as their benefit, how can you really blame them? We don’t live in a culture where people are embarrassed to ask for a handout. It is so easy just to file for benefits by computer, have the funds deposited directly into your bank account or take your EBT credit card to buy anything you want. There is no shame in taking government assistance, you are entitled to it.
“Today, more people than ever before—67.3 million Americans, from college students to retirees to welfare beneficiaries—depend on the federal government for housing, food, income, student aid, or other assistance once considered to be the responsibility of individuals, families, neighborhoods, churches, and other civil society institutions. The United States reached another milestone in 2010: For the first time in history, half the population pays no federal income taxes.” - National Review
So the tipping point has been reached and now the government is scrambling to grab any and all money that working people make just to pay these entitlements. Unfortunately, the American people are waking up and becoming more like the young man I talked to. They are seeing that their hard work and effort is not benefiting their own families, but being redistributed to others; some who need it and others who just don’t bother to work. Look at the major companies that are paying out dividends before the huge taxes kick in. They can see the writing on the wall and are preparing for it.
The young already know that they will probably never see social security or Medicare benefits in their lifetime yet they see it withdrawn from their checks every week. They are the ones sensing the “unfairness” of all of this, not the people reaping the benefits.
This is NOT America, this is not who we are as a country. If we don’t stop punishing success and achievement, future American generations (if there are any) will be content to sit at home and count their government goodies but will never excel at anything, never strive to be anything. There will be no incentive to achieve success. Why should you? It will just be taken away.
Once the so-called “rich” have been drained dry the only option left for the government will be to just keep printing money. That lasts until the economy collapses in on itself and by that time the country we knew will be just like that fading Polaroid, a memory.
Morgan Brittany
Politichicks.tv
@Morganbrittany4
Yes, he's so lucky. /sarc
$ wise, I would still have more. Of course, I would never want a job that paid that much because, as you say, the responsibility and workload is way more than I want. Money isn’t everything.
“I call BS. If someone really did turn down a promotion or a different higher paying position because of a 39% top marginal rate then that person is an idiot. Who in their right mind would turn down more cash in their pocket?”
True, but only if the person continues with the same expenses. Often the higher income requires working in a more expensive place with a much higher cost of living. Choosing to take less money by taking a job in a cheaper location can be financially better - both in terms of living expenses and taxes. Just look at the migration away from New York and California if you want to watch this is real time.
You left out the part where you'd be willing to miss all those things for the right price.
Am I correct in assuming you wouldn't? In that case, this isn't really the right argument - even though I agree with you 100%.
This is not sarcasm. I'm happy for you. I hope you are not envious of those who don't feel the same way, and work harder to earn more.
I'm not sure I'm not envious of you. I've never found a job that I can say I'd rather do than win the lottery and do nothing. I work to earn money to support myself and my family, that's the only reason. Every dollar earned is a trade-off for something I'd like to do, so these economic concerns are important to me.
Read "The Moon is a Harsh Mistress" by Heinlein. It's an interesting read, and he answers that question.
Personally, I think Congresscritters should pay for every one of their good ideas out of their own pockets. THEN we'd see how much they believed in them.
Read "The Moon is a Harsh Mistress" by Heinlein. It's an interesting read, and he answers that question.
Personally, I think Congresscritters should pay for every one of their good ideas out of their own pockets. THEN we'd see how much they believed in them.
“If someone really did turn down a promotion or a different higher paying position because of a 39% top marginal rate then that person is an idiot.”
Yeah, cuz afterall those persons making $200K already are proven idiots! What is amazing to me is that many here are talking trash like you are, yet you forget that the jump to these income amounts means A LOT more responsibility.
It’s pretty easy for me to sit around and say, “wow, I’d pay that tax and still be way ahead.” Then I look at the higher execs around here and their schedules and responsibilities.
I can imagine a promotion from $200K to $250K, could very well mean 50% more responsibilities, meaning more travel, more time away from family, less opportunity to start a family, etc and etc. When balancing the full equiation, I can certainly see how many would see that their 50% more in responsibilities is initially a 25% raise in pay, then the local, state and fed leaches get their cut....
There wouldn’t be any congressmen, then the POTUS would have complete say-so.
“If a person made $260k/yr, couldn’t they take $11k pre-tax earnings and invest it in something that is tax free? Wouldn’t that make their taxable income $249k?”
NO. You might avoid future capital gains taxes if you bought something like municipal bonds but you would still have to pay the original taxes on the income.
Our government is operating in a sweet spot where the majority of voting adults don’t pay federal income taxes and where the remainder have no idea what the tax code actually is since the rules are so complex they hire someone else to fill out the forms.
Actually, it's $2520, and I live in NYC.
'Nuff said.
Not at all, we’re all individuals. I enjoy what I do and the people I work with.
Of course I would rather win the lottery, but let’s be realistic...it’s way easier to get a job and go to work than win the lotto.
Not only will they support corrupt government by taking the raise/promotional which gives more money/power to this government, but they'll be working a hell of a lot harder.
Once ya add everything up, there is no way it's worth it in today's America....
Your attitude assures that will happen.
Wrong.
Article can't even get the important facts correct, so I stopped reading.
The question is not “why work?”, it’s “why work ‘on the grid’?”
I about gagged when I saw my first check...I was better off making less and giving the government less and I did considerably less work.
Live and learn.
I won't argue against any of that because it's all true. However my comment was directed at the OP where it looks like the only consideration for turning down a higher salary was because of having to pay a 39% marginal rate on income over $250,000/yr as opposed to a 35%, or whatever it is right now, marginal rate on income over $250,000/yr.
Actually the pay scales at where I work assure it.
If you take a 25% raise to get 50% more responsibility then you are still an idiot.
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