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> To hit 55% tax rate in California after this, you only need to make like $250k total If you make 250k as an individual you're in the 97th percentile in the s

> To hit 55% tax rate in California after this, you only need to make like $250k total If you make 250k as an individual you're in the 97th percentile in the state, 91th for a household. If that's impossible to live on how do the 90% below you survive? It's literally four times the median wage in the state. Also another perspective from across the pond, I hit the maximum marginal income tax rate at 57k. Of my 85k paycheck I pay a little less than half effectively in taxes and social contributions so this discussion is like another world to me https://dqydj.com/income-percentile-by-state-calculator/ https://dqydj.com/income-percentile-by-state-calculator/

pembrook 5y ago
Comparing salaries to all of California is an irrelevant data point. Most Californians don’t live in the Bay Area, where basic housing costs $1.5M Can a family of 4 live on $250k in the Bay Area? Of course. But you’ll never own a home. And working for the wealthiest companies in the world doing the most in-demand job in the world, yet never being able to own a home, that’s a bizarre situation to be in. We want to incentivize more people to work in tech. Not less. Whatever you get paid in Europe is irrelevant since it’s a completely different system (from healthcare and education down to public transport and housing). And if Europe wants to be at all competitive with the US or China in tech (right now, it’s not), maybe you should be getting paid more than a mid-level accountant?
- snewman 5y ago
  The problem here is not taxation, it's the artificially constrained housing supply in the Bay Area. Too many people are chasing too few houses; they would remain unaffordable to most even if the tax rate were zero, because prices would rise to match income.
  - pembrook 5y ago
    Fully agree, it's a housing supply issue. But raising taxes while not addressing the supply problem will make it worse for those who have not already "cashed out" their capital gains into tax-advantaged real estate.
    - delusional 5y ago
      "We can't solve the issue because that would be unfair to the people who haven't gotten to make use of it yet" isn't a compelling argument.
- eertami 5y ago
  >And if Europe wants to be at all competitive with the US or China in tech (right now, it’s not), maybe you should be getting paid more than a mid-level accountant? I have 10 weeks vacation and a <20 hour workweek. I'd really rather _not_ be competitive with the US or China.
  - bko 5y ago
    Congrats, but you can't opt out of competition indefinitely. If someone is willing to do the same job except better or for less, it'll eventually happen. Or do you think you're entitled to that job due to historical reasons?
- hyperbovine 5y ago
  Give me a break, there are tons of home owning families in the Bay who make less than that. The Bay Area is a lot more than Palo Alto, SF, Mountain View and Berkeley.
  - xyzzy_plugh 5y ago
    Can't give you a break, unfortunately. They already had homes before costs got to their current point. I made more than 250k and could not afford any home within an hour's commute to SF in the years my income was that high. I might've been able to buy a condo at one point, but that's about it.
    - hyperbovine 5y ago
      https://www.redfin.com/neighborhood/14233/CA/Oakland/West-Oakland https://www.redfin.com/neighborhood/14233/CA/Oakland/West-Oa... Most of these are well within reach, even moreso before the current bubble, if you make that kind of money. And an 8 minute BART ride from the city. Your not wanting to live there does not imply that somebody does not live there.
      - xyzzy_plugh 5y ago
        You're right, I forgot about the 0.8% of homes in the Bay Area smaller than most condos in an area where your chances of being involved in a crime are 1 in 6.
        hyperbovine 5y ago
        Your made up 0.8% statistic perfectly conveys the point I was trying to make above.
        xyzzy_plugh 5y ago
        It's not made up. The US Census data is public to all. Number of households in West Oakland divided by the number of households in the entire Bay Area. If you look at just houses, the number is even worse. Your example is beyond cherry-picked. The population of that region is only 21k. It is not remotely representative of the reality the vast majority of residents face.
- UncleMeat 5y ago
  A small change in tax policy isn't going to make the difference in owning a home in the bay area. The problem there is the price of housing. Yes, somebody making 400k in Palo Alto isn't rolling in stacks of cash (though you are certainly doing a lot better than the grad students making 30k). But this sort of "hey but in this extreme edge case the policy is sort of frustrating" argument is consistently overused to prevent reasonable policies (see estate taxes and farms for a classic example).
deleted 5y ago
[deleted]
germandiago 5y ago
The question here should be what we are promoting by spoiling higher salaries and giving back to others. Are you sure this will make for a good incentive for: - people who excel at business to stay. - lazy people to work instead of relying on welfare. Besides that, needless to say that taxing is unfair in itself and taxing depending on how much you make is like treating you different because you belong to a group or another. Reminds me, in some ways, to Europe's middle age: you were judged different depending on different rules according to groups. I understand US is very different from my country, but my advice is that do not give a centimeter to any kind of positive discrimination (taxes, race, sex, religion or whatever). Once you have that one part will abuse the other. The only solution is to be as dilligent as possible applying same rules to everyone equally. Yes, they sell all with nice words and good causes in-between, with you being spoiled with no word on what to do with that. But at the end, this is involution IMHO.
- adabyron 5y ago
  > good incentive for: > - people who excel at business to stay. I use to believe what you're saying. In fact I often quoted very similar lines in arguments. The more I've made, the higher up I've moved, the more senior executives I've worked closely with, the less I believe it though. Most "Sr. Execs" have just put in time, had some luck & networked well. Higher salaries are rarely the incentive to become amazing at something. If you become amazing at something, usually you just love that type of work. Money as an incentive, for anyone who is living comfortably, has shown time & time again to not be a great incentive. Many people now are preferring remote work over higher salaries. Time > Money. In middle & upper class incomes, the only thing I've seen higher salaries encourage are fast track MBAs and butt kissing. Those in the upper income have done very well by encouraging favorable tax laws on themselves. They donate to politicians. They receive favorable tax breaks through real estate, capital gains, avoiding FICA tax of 15.3%, business deductions, low interest loans, etc. If you donate & network enough, you can also get some nice business contracts from the government. > good incentive for: > - lazy people to work instead of relying on welfare. Welfare is not for the lazy. It's for the burdened & hopeless. It's also to keep people well off enough to work but not go around stealing & attacking people out of hunger. It's like trying to dig out of a hole with a shovel while wealthy people are driving tractors & digging your hole deeper. Cheap labor is what makes wealthy people wealthy. A CEO can hire cheap labor, the govt will tax them "FICA" & income tax. The CEO will take their money in stock, so no "earned income" & no "FICA". If they do take an income, FICA is only on a small portion of their salary. The CEO can also get almost interest free loans on that stock, so no need to even sell stock & pay any tax.
d0gsg0w00f 5y ago
Because you can go somewhere else and take home more. Humans are constantly dissatisfied with their situations and seek continuous improvement. This causes a lot of friction but it's what breeds innovation. The "why can't you just be happy with what you have?" argument applies at all levels of life. You could take this same argument from the bottom of the class hierarchy all the way to the top and it still won't stop humans from wanting more. This is in fact the same mental mechanism that enabled us to climb _from_ the bottom. You can't just turn it off no matter how high you climb. I speak from personal experience climbing from working in fast food, warehouses, construction then to white collar IT leadership positions. I can't turn off the drive to be better no matter how good things get and I don't want to because it's the core of how I survive. Just my $0.02

pembrook 5y ago

Comparing salaries to all of California is an irrelevant data point. Most Californians don’t live in the Bay Area, where basic housing costs $1.5M Can a family of 4 live on $250k in the Bay Area? Of course. But you’ll never own a home. And working for the wealthiest companies in the world doing the most in-demand job in the world, yet never being able to own a home, that’s a bizarre situation to be in. We want to incentivize more people to work in tech. Not less. Whatever you get paid in Europe is irrelevant since it’s a completely different system (from healthcare and education down to public transport and housing). And if Europe wants to be at all competitive with the US or China in tech (right now, it’s not), maybe you should be getting paid more than a mid-level accountant?

snewman 5y ago
The problem here is not taxation, it's the artificially constrained housing supply in the Bay Area. Too many people are chasing too few houses; they would remain unaffordable to most even if the tax rate were zero, because prices would rise to match income.
- pembrook 5y ago
  Fully agree, it's a housing supply issue. But raising taxes while not addressing the supply problem will make it worse for those who have not already "cashed out" their capital gains into tax-advantaged real estate.
  - delusional 5y ago
    "We can't solve the issue because that would be unfair to the people who haven't gotten to make use of it yet" isn't a compelling argument.
eertami 5y ago
>And if Europe wants to be at all competitive with the US or China in tech (right now, it’s not), maybe you should be getting paid more than a mid-level accountant? I have 10 weeks vacation and a <20 hour workweek. I'd really rather _not_ be competitive with the US or China.
- bko 5y ago
  Congrats, but you can't opt out of competition indefinitely. If someone is willing to do the same job except better or for less, it'll eventually happen. Or do you think you're entitled to that job due to historical reasons?
hyperbovine 5y ago
Give me a break, there are tons of home owning families in the Bay who make less than that. The Bay Area is a lot more than Palo Alto, SF, Mountain View and Berkeley.
- xyzzy_plugh 5y ago
  Can't give you a break, unfortunately. They already had homes before costs got to their current point. I made more than 250k and could not afford any home within an hour's commute to SF in the years my income was that high. I might've been able to buy a condo at one point, but that's about it.
  - hyperbovine 5y ago
    https://www.redfin.com/neighborhood/14233/CA/Oakland/West-Oakland https://www.redfin.com/neighborhood/14233/CA/Oakland/West-Oa... Most of these are well within reach, even moreso before the current bubble, if you make that kind of money. And an 8 minute BART ride from the city. Your not wanting to live there does not imply that somebody does not live there.
    - xyzzy_plugh 5y ago
      You're right, I forgot about the 0.8% of homes in the Bay Area smaller than most condos in an area where your chances of being involved in a crime are 1 in 6.
      - hyperbovine 5y ago
        Your made up 0.8% statistic perfectly conveys the point I was trying to make above.
        xyzzy_plugh 5y ago
        It's not made up. The US Census data is public to all. Number of households in West Oakland divided by the number of households in the entire Bay Area. If you look at just houses, the number is even worse. Your example is beyond cherry-picked. The population of that region is only 21k. It is not remotely representative of the reality the vast majority of residents face.
UncleMeat 5y ago
A small change in tax policy isn't going to make the difference in owning a home in the bay area. The problem there is the price of housing. Yes, somebody making 400k in Palo Alto isn't rolling in stacks of cash (though you are certainly doing a lot better than the grad students making 30k). But this sort of "hey but in this extreme edge case the policy is sort of frustrating" argument is consistently overused to prevent reasonable policies (see estate taxes and farms for a classic example).

deleted 5y ago

[deleted]

germandiago 5y ago

The question here should be what we are promoting by spoiling higher salaries and giving back to others. Are you sure this will make for a good incentive for: - people who excel at business to stay. - lazy people to work instead of relying on welfare. Besides that, needless to say that taxing is unfair in itself and taxing depending on how much you make is like treating you different because you belong to a group or another. Reminds me, in some ways, to Europe's middle age: you were judged different depending on different rules according to groups. I understand US is very different from my country, but my advice is that do not give a centimeter to any kind of positive discrimination (taxes, race, sex, religion or whatever). Once you have that one part will abuse the other. The only solution is to be as dilligent as possible applying same rules to everyone equally. Yes, they sell all with nice words and good causes in-between, with you being spoiled with no word on what to do with that. But at the end, this is involution IMHO.

adabyron 5y ago
> good incentive for: > - people who excel at business to stay. I use to believe what you're saying. In fact I often quoted very similar lines in arguments. The more I've made, the higher up I've moved, the more senior executives I've worked closely with, the less I believe it though. Most "Sr. Execs" have just put in time, had some luck & networked well. Higher salaries are rarely the incentive to become amazing at something. If you become amazing at something, usually you just love that type of work. Money as an incentive, for anyone who is living comfortably, has shown time & time again to not be a great incentive. Many people now are preferring remote work over higher salaries. Time > Money. In middle & upper class incomes, the only thing I've seen higher salaries encourage are fast track MBAs and butt kissing. Those in the upper income have done very well by encouraging favorable tax laws on themselves. They donate to politicians. They receive favorable tax breaks through real estate, capital gains, avoiding FICA tax of 15.3%, business deductions, low interest loans, etc. If you donate & network enough, you can also get some nice business contracts from the government. > good incentive for: > - lazy people to work instead of relying on welfare. Welfare is not for the lazy. It's for the burdened & hopeless. It's also to keep people well off enough to work but not go around stealing & attacking people out of hunger. It's like trying to dig out of a hole with a shovel while wealthy people are driving tractors & digging your hole deeper. Cheap labor is what makes wealthy people wealthy. A CEO can hire cheap labor, the govt will tax them "FICA" & income tax. The CEO will take their money in stock, so no "earned income" & no "FICA". If they do take an income, FICA is only on a small portion of their salary. The CEO can also get almost interest free loans on that stock, so no need to even sell stock & pay any tax.

d0gsg0w00f 5y ago

Because you can go somewhere else and take home more. Humans are constantly dissatisfied with their situations and seek continuous improvement. This causes a lot of friction but it's what breeds innovation. The "why can't you just be happy with what you have?" argument applies at all levels of life. You could take this same argument from the bottom of the class hierarchy all the way to the top and it still won't stop humans from wanting more. This is in fact the same mental mechanism that enabled us to climb _from_ the bottom. You can't just turn it off no matter how high you climb. I speak from personal experience climbing from working in fast food, warehouses, construction then to white collar IT leadership positions. I can't turn off the drive to be better no matter how good things get and I don't want to because it's the core of how I survive. Just my $0.02