3 ms·

> which is firmly in the 1% If the numbers at https://dqydj.com/average-median-top-household-income-percentiles/ https://dqydj.com/average-median-top-household

> which is firmly in the 1% If the numbers at https://dqydj.com/average-median-top-household-income-percentiles/ https://dqydj.com/average-median-top-household-income-percen... are correct, the "top 1%" household income threshold in the US in 2020 is $53lk. $400k is closer to the "top 2%" level. More importantly, these numbers like "400k" tend to not be inflation adjusted (e.g. the cutoffs for the net investment tax and the additional medicare tax are not, cutoffs for phaseouts of the child tax credit are not, etc). And income percentiles grow faster than inflation. Looking at that same data table, it looks like the percentile boundaries grew 6%+ year over year from 2019 to 2020. If that's not a fluke caused by the pandemic in some way, then in 10 years you expect something like 1.79x growth in the cutoff numbers, which would put $400k at about the "top 8%" level at that point. Is it possible that your idea of what level is "firmly in the 1%" is just a few years out of date?

EMM_386 6y ago
I shouldn't have even included the "top 1%". That's an unfortunate flash point for veering any policy discussions off the rails. Take the raw numbers. Yearly household income of $400,000 is not gong to affect the baby sitter or local contract plumber. I stand by my assertion that the OPs comment was attempting to distort the narrative. Yes this may need to be adjusted for inflation down the road, like anything else.
- bzbarsky 6y ago
  Fwiw, I think you were misunderstanding part of the comment you replied to. It was not saying that the babysitter or contract plumber make $400k but that the local grocery shop owner might, and that both that shop owner and someone truly rich add comparable amounts to the economy in terms of service consumption. I suspect that both of those claims are dubious, by the way. Someone with more wealth is in fact likely to employ more plumbers (due to having more toilets) and babysitters-per-child (full-time nannies, tutors, etc). And given how low-margin grocery stores are, I don't know that I'd expect a grocery shop owner to end up with $400k+ taxable income.... > Yes this may need to be adjusted for inflation down the road, like anything else. My main point about the inflation bit is that it's disingenuous to introduce a new tax with a claim that it "does not affect the middle class" when you know with near-certainty that in 10 years or less it absolutely will. In fact you are banking on that to make the numbers you depend on actually work out. Almost all proposals to "tax the rich" that do not come with automatic inflation adjustments built in are just proposals to tax the middle class in disguise.

EMM_386 6y ago

I shouldn't have even included the "top 1%". That's an unfortunate flash point for veering any policy discussions off the rails. Take the raw numbers. Yearly household income of $400,000 is not gong to affect the baby sitter or local contract plumber. I stand by my assertion that the OPs comment was attempting to distort the narrative. Yes this may need to be adjusted for inflation down the road, like anything else.

bzbarsky 6y ago
Fwiw, I think you were misunderstanding part of the comment you replied to. It was not saying that the babysitter or contract plumber make $400k but that the local grocery shop owner might, and that both that shop owner and someone truly rich add comparable amounts to the economy in terms of service consumption. I suspect that both of those claims are dubious, by the way. Someone with more wealth is in fact likely to employ more plumbers (due to having more toilets) and babysitters-per-child (full-time nannies, tutors, etc). And given how low-margin grocery stores are, I don't know that I'd expect a grocery shop owner to end up with $400k+ taxable income.... > Yes this may need to be adjusted for inflation down the road, like anything else. My main point about the inflation bit is that it's disingenuous to introduce a new tax with a claim that it "does not affect the middle class" when you know with near-certainty that in 10 years or less it absolutely will. In fact you are banking on that to make the numbers you depend on actually work out. Almost all proposals to "tax the rich" that do not come with automatic inflation adjustments built in are just proposals to tax the middle class in disguise.