by Ouida on March 26, 2010
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History of US Marginal Tax Rates
This graph is a gift from my Financial Adviser, Kim Butler of Partners4Prosperity. Tax rates are at their historic lows. The government has depended on a phenomenon called “bracket creep” to raise revenues. Bracket creep occurs when a work force receives regular increases in pay that result in broad movement into higher tax brackets. Most economic reports indicate that wages have been flat for the last decade, therefore tax revenues have been flat to declining. Bracket creep has not occurred. What, then, is going to happen? Taxes are going to have to go up…for everybody. Right now the government is playing the rich against the poor and middle class by promising benefits at the expense of those who should pay “their fair share”, the rich. But right now the rich, households making greater than $250,000, account for just 2% of the population. They can only be taxed so much.
Then what happens? Taxes must trickle down…to everyone.
And shouldn’t everyone have a hand in paying for the social safety nets we want to build? I believe it is important for everyone to decide what they want to pay for. If universal health care is a good idea, then it is a good idea no matter who pays for it.
It is pretty clear that taxes have room to go…up! So what do you want to pay for?
Please comment.
by Ouida on March 25, 2010
I’ve mentioned before that I was a financial wreck. Wracking up thousands of dollars in credit cards each month. Buying $15 dollar a pound coffee, deferring the interest payments on my student loans until I almost completely reversed the benefit of having received student loan payback. I spent money and had nothing to show for it. Did you know, it is possible to nickel and dime yourself into massive credit card debt? I sure found that out the hard way. [keep on reading!…]
by Ouida on March 24, 2010
It was June 2007. I returned home to find water running down my driveway and out my front door. In my house I heard the whoosh of water and felt the water soaking in through my shoes. Four inches of it in my home, every room. The laundry room was the epicenter. Dry wall ruined. A water hose on the washing machine was the culprit. In a moment, my plans changed. I was supposed to be headed out of town. Insurance company called, flights cancelled. I called a friend and we began to bail my home out.
I picked up my floating belongings, ruined books, papers hard drives and computers and realized then that I had way too many personal possessions. That was a tough realization for me. I consider myself frugal. Frugal people don’t buy things they don’t need, right? Many of the things I found floating round my home were things, books especially, that people had given to me. My closets were littered with clothes that I hadn’t worn in years, yet had not sorted through to give away.
You don’t appreciate the amount of junk, clutter in your until you have to empty your home in 2 hours, Once I filled the garage, everything else had to go in the back yard; a friend of mine came by and told me that my back yard looked like a scene from Sanford and Son. The lesson from the flood what that my house was filled with junk pain and simple.
I vowed to de-clutter and stay that way. For a time I did it. Now I look around and discover un-filed papers, unread books and unviewed DVDs. For a brief moment I considered buying a cabinet to house them! But I have come up with a better plan, I think. In the next 60 days, I am going to host a de-clutter party. I will cook for friends and in exchange, they can hold my hand while I empty out shelves. I am declaring a moratorium on buying books for the next 60 days, until I identify the ones I will never read and determine a place (not inside my home) for them. I am also going to add up the cost of those books and post it around my home as a reminder. I will make a reading list and read the books I haven’t read posting them on this blog so that you can cheer me on as I check them off. I will also let you know how the anti clutter party went
complete with pictures.
Let me know your struggles with clutter and what you have done about it.
by Ouida on March 22, 2010
From Ayn Rand’s Atlas Shrugged:
“Mr. Rearden,” said Francisco, his voice solemnly calm, “if you saw Atlas, the giant who holds the world on his shoulders, if you saw that he stood, blood running down his chest, his knees buckling, his arms trembling but still trying to hold the world aloft with the last of his strength, and the greater his effort the heavier he world bore down on his shoulders – what would you tell him to do?”
“I… don’t know. What… could he do? What would you tell him?”
“To shrug.”
Health care has passed paid for with special taxes levied at the top 2% of income earners while subsidizing premium payments for 90% of households. I voted for President Obama and I am a doctor. I will be the first to tell you that our health care system is a mess. Too much money is spent without significant gains in public health. We have some of the best medical technology available in the world while lagging industrialized nations in infant mortality. Physicians view each patient encounter as an opportunity to get sued and act defensively to prevent that from happening ordering unnecessary tests increasing health care costs. We have become a nation of people who expect unlimited access to everything without regard to cost. Creative mortgages for people who cannot truly afford to own a home. Credit cards for people who cannot truly afford that flat screen TV. We have also become a nation of people who want without sacrifice. Everyone will benefit from the broader availability of health care, yet reform is paid for on the backs of a few people. Our nation is in the middle of a class warfare that probably began with Clinton, was intensified by Bush and has continued with Obama. I was attracted to our president because of his intellect and his rhetoric of shared sacrifice but that rhetoric has given way to programs of income redistribution and a burgeoning sense of entitlement in our society. I am reminded of a bible story recounted by the late business philosopher, Jim Rohn: Jesus and his disciples are receiving donations. People of all classes give. Finally a woman arrives and gives the equivalent of a penny. Many of the disciples are incredulous. Jesus is not, he recognizes the sacrifice of this woman’s gift and treasures it above all others. Jim Rohn’s take on the story? That in a civilized society, everyone must pay in order to enjoy the fruits of that society. 0.9% In Medicare taxes across the board would mean that the $30,000 per year wage earner would pay $22.50 per month to support a program that would benefit us all. Is this an unreasonable amount of money? I don’t think so especially because health care reform will subsidize that wage earner’s access to care. As things stand, the person who makes $30,000 per year will receive the benefit without the sacrifice and will therefore have no ownership in the system. Will Atlas Shrug? I am not surrendering my passport but I do believe that continuing to tax certain members of society whose only crime is producing more is unsustainable and brings us closer to the day when we wake up and find our producers gone and our talent overseas.
What are your thoughts?
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