Tuesday, March 26, 2013

Buffett Repeating Himself

The only issue I want to raise with this is where Warren says: "However, I prefer a cutoff point somewhat above $250,000 — maybe $500,000 or so."  There was something in the Fiscal Times furthering this by pointing out that $250k in 1993 is about the same as $400k today. 

Here's the thing: $250k is a crap-load of money.  It is infuriating each and every time anyone (though particularly very rich people) try and argue that it isn't.  The median income in this country is one fifth of that, and well over 90% of families must make do on less than half.  Even very wealthy Manhattan's median income is less than $100k.  People (individuals and families) just don't make nearly as much money as [rich] people think we make, and it makes a huge difference in terms of how we discuss things, like, say retirement.

If we think that lots of families are pulling in $200k/year then it's pretty easy to say that people are irresponsible who don't save enough for retirement, and it's therefore easy to argue that making SS less generous is not that bad: people just need to save a little more.  But families are not pulling in that kind of money.  Most families are living on $66k/year, and after taxes and necessities there isn't a whole lot left over.  If they are forced to save more, then it means a real drop in their standard of living.

Any family getting $250k/year is very well off, at the very least.

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