Posted on 09/06/2010 1:23:04 PM PDT by NaturalBornConservative
Legalized Robbery
Collecting more taxes than is absolutely necessary is legalized robbery. ~ Calvin Coolidge
By: Larry Walker
The question of the day: Why is making $250,000 a year suddenly considered wealthy? The Obama's made $5.5 million last year. Is that wealthy?
Contrary to popular belief, $250,000 in 2010 had the same buying power as $20,722 in 1926. Annual inflation over this period was 3.01%. An income of $250,000, adjusted for inflation, would have placed a taxpayer in an 11% tax bracket in 1926. In order to have been considered in the top tax bracket back then, in today's dollars, would have required taxable income in excess of $1,206,419. The 1926 tax tables are shown below along with equivalent 2010 dollar amounts:
So in inflation adjusted dollars, people like the Obama's would have been considered wealthy in the 1920's and should rightfully be in the top tax bracket today. On the other hand, folks making $50,000 to $250,000 today, would have been barely considered middle class back in 1926.
The Revenue Act of 1921 contained additional tax brackets above the $100,000 level to tax the super rich. They were as follows: $100,000 @ 56%, $150,000 @ 57%, $200,000 @ 58%, $300,000 @ 71%, $500,000 @ 72%, $1,000,000 @ 73%. Translating this into 2010 dollars would yield the following amounts, respectively: $1,113,139 @ 56%, $1,669,709 @ 57%, $2,226,278 @ 58%, $3,339,418 @ 71%, $5,565,696 @ 72%, and $11,131,392 @ 73%.
President Calvin Coolidge, under the Mellon Tax Bill, slashed top rates from 73% in 1921, down to 25% in 1926. The new top bracket was 25% for anyone making over $100,000 ($1,206,419 in 2010 dollars). So under the Revenue Act of 1921, the Obama's would have been forking over 72% of their income to Uncle Sam, but only 25% under Coolidge. What a relief that would have been. The "Roaring Twenties" had arrived, catapulting multitudes into the middle class.
Now let's bring it up to today. How did the lower tax brackets of 1926 grow from being between 1.4% and 14%, all the way to today's level of 10% to 33%? And let's not forget about the 7.65% (15.3% for the self-employed) that we all get soaked for in Social Security and Medicare taxes. Under the Social Security Act of 1935, the FICA tax was set at 1% of the first $1,400 in wages. It's interesting to note that $1,400 in 1935 is the equivalent of $22,562 today, and yet the rate today (exclusive of Medicare tax), is 6.2% (12.4% for the self-employed) of the first $106,800 in wages. It's called legalized robbery.
When voters finally drop this left, right bickering and start looking at the facts they are going to wake up one day and realize that we've all been bamboozled. We've been getting robbed for so long that we don't even know the difference. The following table compares today's tax rates with 1926 rates for comparable incomes.
In reviewing our current tax tables, it is apparent that a couple making $250,000 in 2010 would have been taxed at a rate of 11% in 1926, and yet the rate is now 33%. Also, those in the top tax bracket, those making over $373,650, would have had tax rates between 14% (at the low end), and 25% for the super rich, and yet the rate is now 35%. Then along comes Obama proffering to raise the top rate up to 39.6%. The problem is that the whole tax system is out of whack.
Under Obama's 'made up' theory, a couple making $250,000 should be taxed at the same rate as a couple making $5.5 million or more. Is that fair? Should a couple who makes $250,000 be taxed at the same rate as a couple making $11 million or more? Who's kidding who?
Annual income, as defined in current tax tables, needs to be appropriately adjusted for inflation. Tax rates on the other should be adjusted back towards the historical lows, not adjusted for inflation (as eventually they would exceed 100%). There is not one section of the Internal Revenue Code that has been consistently adjusted for inflation, neither the standard deduction, nor personal exemptions have kept pace. Tax brackets have been lowered and raised seemingly based on the whims of politicians, and not based on historical inflation adjusted incomes, and that's wrong. It's just plain wrong.
It's time to stop playing games with the American people, and time to start governing honestly. I'm sick and tired of rich Washington politicians, like the Obama's, trying to pretend that they're on the same level as everyone else. The Obama's are millionaires and should pay accordingly. But let's be fair about it, making $250,000 a year in 2010 is not rich, it wasn't considered rich in 1926, and it's not rich today.
What we need is real tax reform, not more of the same. If you're not part of the solution, you're part of the problem, and unfortunately, Obama is part of the problem.
Sources:
http://www.dollartimes.com/calculators/inflation.htm
http://en.wikipedia.org/wiki/Revenue_Act_of_1926
http://en.wikipedia.org/wiki/Revenue_Act_of_1921
The Obamas
That is eminently fair. There should be only one LOW rate. All incomes should be taxed at the same percentage. 9% would be good with no deductions or exemptions at all for "earned income." Everyone needs to pay taxes so that everyone has an interest in keeping them low.
But you know they have a very real cognitive dissonance. They really do not know how silly they are. If Michael Moore is so crazy for socialism, why doesn't he just give all of his money to the government? Or the poor? I mean, just do it! Leave the rest of us alone.
The ones making the rules always manage to exempt themselves.
Ever since he started spewing this crap in the campaign I’ve had one question. Out her in rural America aka “fly-over country” to him, it’s probably not uncommon for a decent-sized farm to have income over $250K/yr. But of course they have big expenses too, and sure don’t “make” 250K a year in terms of disposable income. Which is Obama talking about when he goes into this redistribution fantasyland of his?
Same could be said for small businesses, proprieterships, limited partners, or others who might actually create jobs if they were allowed to keep and reinvest their own money.
The bigger fallacy is that only people that are making more than $250k are going to see their taxes rise. Taxes are already increasing for many people via Obamacare. I’m betting that Obama will break the bad news for the middle class after the election.
“Obamas” - Duly noted, and corrected on the original post. It’s always something.
Here we have a wealthy elitist who never earned his money but lied stole and cheated to obtain it is telling the hard working American that we will do everything humanly possible to prevent you from ever getting close to me and my deviant friends. Arrogant PUBLIC SERVANTS need to be taught a life lesson come November and in 2012
Spewing and Crap are the operative words.
obastard and government in general simply spew crap. Mostly lies and damn lies.
Just keep flipping back and forth between the obastard and Bush budgets. Bush was no angel but we are being lied to on a massive scale. I’m going to keep posting this at every opportunity.
http://www.usgovernmentspending.com/federal_budget
It's not about helping the poor. These malevolent nonproductive scum are filled with envy,guilt, or laziness, and resentment against the good (the producers) for being the good. So what they really want is government power to control everyone and to destroy the producers and enrich themselves.
Any REAL opposition Party would be slapping their opponents with this like a wet fish.
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