The Problem

by digby

I know it’s annoying that people like me are constantly harrassing the elite media, but it’s terribly important that somebody do it, especially during these times. These wealthy celebrities are living in another universe from most of the rest of us and never is it more obvious than when they talk about money, which is the main topic of discussion these days and arguably the most confusing.

Here’s a perfect example from one of last week’s Hardballs:

SIMON: I mean, they don‘t have a plan. The response is, This is no time to be raising taxes because we‘re in a recession, and also that soaking the rich is class warfare. But the Obama White House, as you saw by reading Summers‘s comment there, is not selling this as soaking the rich. Actually, we don‘t want class warfare in America. We want fairness. And we‘re saying people should pay their fair share.And now it‘s time, as David‘s article pointed out, where the fair (ph) have been getting a break for decades now, now it‘s time for them to step up and pay their fair share. The difficulty comes really in defining the rich.
People today—if you make—if you‘re a family making $250,000 or more, you‘re going to pay more in taxes. A two-income-earner family making $250,000 today, with maybe a couple of kids in college, paying off their mortgage, who have seen their life savings cut in half, if not more, by a falling stock market, probably don‘t consider themselves rich. They probably consider themselves the middle class. I‘m sure the White House would rather have said, millionaires only get taxed more. The trouble is, if you tax just people making $1 million a year, you wouldn‘t raise enough money. You have to reach into the middle class to get the real wealth of America. And that‘s why it‘s being defined pretty low, at $250,000.

I’m sure that everyone on that panel thinks that’s true. But it isn’t. In Los Angeles County, where I live, the median income in 2007 was $53,494. Even in Beverly Hills the median income was only $70,945, at the height of the tech bubble. Yet Roger Simon believes there is a large constituency of “middle class” people who make $250,000 a year. And that’s because he and his friends all make at least that much and they think they are middle class.
They aren’t. Those reporting adjusted gross income of more than $250,000 to the IRS are projected to make up 2 percent of households (in 2008.) There is no way that can possibly be considered “middle” class. It’s ridiculous.
These are wealthy people who can easily afford to pay a little bit more in taxes on anything they make above 250K per year. A quarter of a million dollars is objectively a lot of money and anyone can live very well on it anywhere in the country unless they think they are somehow suffering because they can’t afford a Park Avenue penthouse or feel put upon because they can’t vacation at St Barts this spring. Roger Simon isn’t a horrible person, but he is part of the problem. They all sound like little Marie Antoinettes when they say this stuff. Perhaps Rush can persuade his pathetic little Galt worshippers that it’s in their best interest to support wealthy people like him through these tough economic times, but I really doubt that the majority of people in this country are finding a lot of sympathy for anyone who is whining about taxes on their quarter million dollar annual income.
Update: Jamison Foser takes the media downtown on whole tax cut debate. It’s much worse than I thought.
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