Robert Reich on the Economy: KISS (Keepin' It Super Simple)

I'm not the biggest fan of MoveOn.org, but this is one of the easiest to understand videos about the current state of the economy I've seen.  Former Labor Secretary Robert Reich does an excellent job of "Keepin' It Super Simple" explaining the truth about our economy.  Take a look: 

Masterstroke!

Critique and analysis are coming in on the "Lame Duck" session of the 111th Congress and the consensus seems to be saying is that it was anything but lame.  Whether it be a campaign promise kept to repeal "Don't Ask, Don't Tell", or the deal with the devil that was struck between the President and Senate Republican Leadership to extend the Bush Era Tax Cuts for everyone (including the wealthy) while also getting an extension of Unemployment Benefits and a few others Democrats wanted, the winners of the final round of the 111th Congress are the Democrats and President Obama. 

If Republicans are wondering what the heck just happened, Ezra Kline's column in the Washington Post sums it up best with a quote from Senator Lindsey Graham (R) SC, saying that "When its all going to be said done, Harry Reid has eaten our lunch."  Included in this assessment was a major Foreign Policy victory for President Obama with the passage of the new START Treaty. 

If you are feeling a little perplexed, a little in aw of this political mastery, and wondering how the ingredients came together for the President and the Democrats, the always pragmatic and wise David Gergen offers his assessment of the situation by stating,

"What happened?  One answer, I would submit, is that the president and his team found a better approach to governing:  Instead of relying on the Democratic Caucus in each chamber to deliver, they built up coalitions of their own that swayed public opinion in their direction and gave the leverage in Congress." 

So how did these coalitions get cobbled together?  It wasn't just the two moderate Republican Senators from Maine (Olympia Snow and Susan Collins), or Scott Brown from Massachusetts.  It was other, more conservative Republicans, that came together with the President and the Democrats on the way out. 

Retiring Ohio Senator, George Voinovich, the now independent (dare we say Rogue) Senator from Alaska, Lisa Murkowski, newly minted Senator from Illinois, Mark Kirk, and then we have the ethically challenge John Ensign of Nevada, Richard Burr of North Carolina, ranking Republican on Senate Foreign Relations, Richard Lugar and Lamar Alexander of Tennessee, who is in the Republican Leadership.  Of note, Lisa Murkowski voted with the President and Democrats on DATA repeal, START, the compromise on extension of tax cuts and unemployment benefits, and of all things voting with Democrats to end debate on the Dream Act. 

Then there's the Food Safety Bill, the DoD reauthorization, and a few others, that if it were not for Republican support, would have died on the vine.  So then, why did all this pressing legislation that was so important, finally get passed?  There are several thoughts on that.  One being from Ezra Kline, where he observes: 

"The answer, I think, is that there are plenty of Senate Republicans who aren't too comfortable with the class of conservatives who got elected in 2010. These legislators knew they had to stick with McConnell before the election, as you can't win back the majority by handing the president lots of legislative accomplishments. But now that the election was over, the bills that had piled up were, in many cases, good bills, and if they didn't pass now, it wasn't clear that they'd be able to pass later. 

The incumbent -- and the outgoing -- Republicans know that the fact that Republicans will have more power in 2011 doesn't necessarily mean that they'll use that power to pass sensible legislation. So those of them who wanted to pass sensible legislation decided to get it all done now, even if that meant handing Reid and Obama a slew of apparent victories in the lame-duck session." 

For me, its a combination of several factors with a big part of it in line with what Ezra Kline states above.  The opinion polls since the November elections have been loud and clear that voters are tired of the hyper-partisanship and want things to get done.  Congress responded.  Also, it seems that there is a realization from establishment Republicans that the new crop coming in, of which 70-80% of them have never held public office before, are going to be a political nightmare and a major liability if they can't harness the energy in a strategic direction.  Just like Democrats misread the results of 2008, this new group of Republicans seem to be over-reaching and reading too much into the results and projecting a mandate that just isn't there. 

Did the President and Democrats run the table?  Not even close.  They fell short on the omnibus spending bill, Dream Act, and they were unable to exclude the wealthy from the Bush Era Tax Cut extension.  But coming off the "shellacking" of the November 2nd debacle, this was nothing short of clutch, a Masterstroke! 

Image found at:  http://hiphopandpolitics.files.wordpress.com/2010/12/obama-pointing.jpg 

Taxes: Does taxing the wealthy endanger individual prosperity?

As conservatives, anti-tax advocates, and anyone with wealth continue to assert that increasing taxes on high income earners (those making over $250,000 per year as defined by President Obama) will kill any economic recovery, there's new data to the contrary that effectively shoots this claim out of the water.  

Thanks to the watchful eyes of a progressive tax reform group, Citizens for Tax Justice (CTJ), they came across a Wall Street Journal article that more or less dispels the myth that when taxes are raised on high income earners, or places that have higher tax rates on the same group, that wealth flees for places with lower tax rates.

As reported by the Wall Street Journal's Robert Frank, according to an annual report by Phoenix Affluent Marketing Service, "the overall number of millionaire's in the U.S. rose 8% in 2010 to roughly 5.6 million households." 

States with the highest concentration of millionaire's, Maryland and Hawaii, had some of the highest state income taxes.  As a matter of fact, the report that the Phoenix Affluent Market Service pulled their information from was from the conservative tax policy think tank the Tax Foundation.  Among the top ten states with the highest individual income taxes were: 1) New York, 2) Maryland, 3) California, 4) New Jersey, 5) Ohio, 6) Oregon, 7) Hawaii, 8) Wisconsin, 9) Iowa, 10) Vermont.  Virginia ranked around 30 in the report. 

Out of the top ten individual income tax states listed above, "...the millionaire populations and the millionaire densities of Hawaii, Maryland, New Jersey, California and New York increased in 2010 from 2009. That suggests that the states gained more millionaires than they lost."  So what is so attractive about these states with their prosperity killing individual income taxes? 

According to the Wall Street Journal article these are,

"states with large concentrations of highly educated professionals and business owners, which are key ingredients to growing wealth,” according to David Thompson, Managing Director of the Phoenix Affluent Market.  Additionally, “in general, most high-net-worth households don’t base their living decision on tax rates, but on things like quality of life, access to good education, infrastructure and culture.”

In short, high taxes on the wealthy aren't killing their prosperity or driving them out of states with high individual income taxes.  The wealthy and anti-tax advocates are pushing a total myth. 

Links of interest:  http://www.ctj.org/, http://www.taxfoundation.org/ 

Taxes: What if you got a Receipt instead of a Bill?

What a novel idea.  This is so simple that a 5th Grader would understand.  First reported by NPR, Third Way (a moderate to progressive Think Tank based in Washington, DC) has published an Idea Brief proposing the Federal Government provide taxpayers with a receipt for the taxes they pay. 

It would detail a list of Federal Programs that are funded by the taxes we pay.  While not an exhaustive list, the example of what this receipt would look like includes such things as Social Security, Medicare, Medicaid, Interest on the National Debt, Combat Operations in Iraq and Afghanistan, and so forth... 

The motivation behind this is that if Americans saw what their tax dollars paid for, they would think differently about how government works and if their tax dollars are being waisted. 

To learn more about Third Way, click here. 

To view Third Way's Idea Brief, click here. 

Image found at:  http://couponkatie.com/wp-content/uploads/2010/07/071410-Kroger-Receipt.jpg 

Calls growing louder to let the Bush Tax Cuts expire

The message is clear and the calls are growing louder from professional Economists.  Let The Bush Tax Cuts Expire.  Not only is this coming from former Federal Reserve Chairman, Alan Greenspan, but others that generally favor tax cuts like former Reagan White House Budget Director David Stockman, former Treasury Secretary Paul O'Neil (who was fired for opposing the Bush Tax Cuts in the first place) and former Clinton Treasury Secretary Robert Rubin. 

Now, each one of them is advocating different approaches and degrees of expiration, but the consensus is that the price is too high for these tax cuts to continue and the national debt needs to be addresses NOW. 

The White House, most Democrats and some Republicans are pushing and extension of the tax cuts for everyone making less than $250,000 a year and letting them expire for everyone else (which is the top 2%).  That would recover around $700 billion over the next 10 years. 

Greenspan and Stockman are pushing for the complete repeal of the whole tax cut, which are costing the nation $3.7 trillion over that same period.  Simply put, we can't afford them.  Here's Greenspan on Meet the Press: 




Rubin backs the White House position and is also suggesting bringing back the Estate Tax, stating he "would put an estate tax in place right now, immediately. I would increase the tax on the higher brackets."

O'Neil is advocating wholesale Tax Reform, because at the end of the day "it's still the same stupid tax system." 

College becoming more of a luxury in Virginia

It's that time of year again when scores of kids head off to college.  From small colleges to major universities, friends and classmates will reconnect, socialize, and renew their efforts to earn that undergraduate degree.  The difference this year is that the price has gone up, making that piece of paper more of a luxury that only the rich can afford. 

Just as Virginia's transportation infrastructure continues to be underfunded, Higher Education continues in a similar trajectory.  As pointed out by Sunday's editorial in the Roanoke Times and the the August Report from the State Council for Higher Education for Virginia (SCHEV) on 2010-2011 Tuition and Fees, the cost of state supported Higher Education is rapidly becoming unaffordable for most Virginians. 

Not since the 1994-1995 academic year has Virginia's in-state colleges and universities been so expensive.  For five straight years Virginia has cut the budget for Higher Education, shifting more of the burden onto the shoulders of financially strapped families and students working their way through school.  Students will have to pay $838 more this year over last at a four year institution.  At Community Colleges, they will pay $504 more this lear than last for a full load of classes.  Sad to say but that's money that many people don't have since the economy is struggling to recover and millions continue to be unemployed.  The tragedy of it all, getting that undergraduate degree doesn't even guarantee the promise of a living standard that is near that of their parents, or better.

Conservatives continue the call for tax cuts and more cuts to state spending.  Just like the GOP's refusal to consider raising the gas tax at the state level to shore-up transportation funding, they refuse to consider any increase in Virginia's antiquated state income tax or the sales tax.  But, they will consider increasing fees for administrative services, driver's licenses, marriage licenses, hunting and fishing licenses, etc...

At some point, Conservatives will have to make a decision as to how important education is to Virginia.  Not just Higher Education, primary and secondary education too.  Virginia now ranks in the Top 10 in the country for the most expensive in-state tuition.

Conservatives proudly advocate for "personal responsibility" and the celebration of "American Individualism" while at the same time they work to change the rules or move the goal post, making it even harder for those on the receiving end of their scorn to achieve the lifstyle only a Republican can enjoy.  This pattern of inaction by Republicans in the Virginia General Assembly leads me to conclude that it's intentional and they only want a wealth social elite to benefit from a college level education. 

There was a time when higher education was affordable and our lawmakers recognized that if you make it affordable to as large a segment of our citizenry, this investment in people will reap massive benefits.  Because education is available to everyone at the primary and secondary level, and Higher Education has been relatively affordable, this better educated citizenry saw major increases in living standards and made us the most productive nation on the planet.  All of this is now in jeopardy, and we are now moving back to a place where not only wealth, but education, is going to be concentrated in the hands of a select few. 

Image found at:  http://i.acdn.us/image/A3457/345744/300_345744.jpg

TAXES!!! Are we really OVER TAXED like conservatives claim?

Taxes, Taxes, Taxes.  Its that dirty five letter word that elicits grumbles and raises blood pressure.  So, lets face it, nobody likes to pay taxes but most realize that it's the price we pay to live in a democratic and free society.  Our taxes provide the lubrication for interstate and intrastate commerce by building and paving our roads and a few other intangibles tied to our national economy.  They pay for our military, national security, and law enforcement which provides for the national defense and protects the citizenry. 

Our taxes also provide for the general health and welfare of the country so that we can respond to emergencies, natural disasters, outbreaks of communicable diseases, ensure fair wage and labor standards, and even provides for universal education up to the 12th Grade.  This universal education part is probably the most important because once we passed laws for compulsory education, we became the most productive nation in the world. 

We work hard and expect a lot from our multiple levels of government (Federal, State, and Local) for the taxes we pay.  So, when I hear phrases from conservatives and tax cut advocates like "Over Taxed" and "Overly Burdensome" when referring to the taxes we pay, I have to ask:  Compared to what? 

I came across a CNN Opinion Article last night written by John Avlon, who also writes for the Daily Beast.  In it he makes several great points about Goldwater-Regan Conservatives circa 1964, and that if they were running for office today as a "Conservative" they probably wouldn't be elected to Dog Catcher for their support of "Liberal" policies like how Regan raised taxes by a Billion dollars to close a state budget gap while Governor of California.  Or how both Regan and Goldwater supported Gay Rights.  Let's not forget that Regan was an Organized Labor man, being the President of the Screen Actor's Guild for a time. 

So, when it comes to taxes and do we pay too much to the Federal Government, what exactly is too much?  I came across the web site for the Tax Foundation (which is a conservative groups) and came across a publication on their site with the Federal Tax Rates from 1913 to 2010.  One thing that jumps out is that we are paying a lot less in Federal Income Taxes than we did back in 1964.  There are two side to the issue of Tax Liability/Burden/Responsibility:  what we think we pay and what we actually pay. 

In several conversations I've had over the years with conservative friends of mine, the general perception is that we pay close to or over half of our income in taxes.  That covers Federal, State, and Local taxes.  In a short conversation/Facebook chat I had last night with a friend, he estimated that he payed about 45% of his income in taxes.  If we are just looking at Federal Income Tax for 2009-2010, the top marginal tax rate of 35% kicks-in at $373,650 of earned income.  He clarified and made sure that I included all taxes, so here we go: 

Federal Income Tax for 2010  (Tax Bracket and Earned Income - Filling as Head of Household) 

35%          $373,650 and higher 
33%          $190,550 to $373,650 
28%          $117,650 to $190,550 
25%          $  45,550 to $117,650
15%          $  11,950 to $  45,550
10%          $           0 to $  11,950

Federal Income Tax for 1964  (Tax Bracket and Earned Income - Filling as Head of Household) 
(Selected Tax Brackets and Income Levels)

77%          $200,000 and higher 
71%          $100,000 to $120,000 
61%          $  52,000 to $  60,000
39%          $  18,000 to $  20,000 

Well, you can see my point and if you want to pour over a very boring chart with lots of numbers, click on the link above to the Tax Foundation's Tax Chart from 1913 to 2010. 

For anyone that owns a home or has a home equity line of credit, you are able to deduct the lion share of the mortgage interest, so that cuts down on your taxable income.  Child Tax Credits, Primary Care Giver Health Care, etc...  The point here is that with all the available credits and deductions, a person's taxable income at the federal level is reduced even further. 

In the Commonwealth of Virginia the top marginal rate for State Income Tax is 5.75% and that kicks in at around $20,000 of earned income.  So, everyone making that much money a year or more pays the same State Income Tax Rate, and this is based off of your ADJUSTED Gross Income from your Federal Tax Return. 

Federal Gas Tax is 18.4 cents per gallon.  Then states tack on their gas tax. 

Virginia's State Sales Tax is generally around 4% or 4 cents for every dollar spent. 

Then there are Local Taxes (Personal Property and Local Sales Taxes).  In Chesapeake, you will pay $1.04 or $1.05 per $100 of assessed value on your property/house (the difference in the two rates depends on if you live in an area where they spray for mosquitoes or not).  If you own a home assessed at $200,000 you will pay something like $2,100 per year to The City of Chesapeake, which goes primarily to fund the schools, teacher salaries, and Administration. 

In Campbell County, the Personal Property Tax Rate is around $0.42 per $100 of assessed value.  That same $200,000 house in Campbell County will be taxed at around $840 per year. 

Then you pay local sales taxes, which varies from locality to locality.  And then there are the other fees and assessments the Commonwealth of Virginia and localities charge its citizens. 

The bulk of tax payers are in the 25-28% Federal Income Tax Bracket.  According to my "back of the napkin" math, taking into account all taxes and potential fees paid, a person's total tax liability/burden/responsibility is in the range of maybe 35-38%.  Compared to the 1964 Top Marginal Income Tax Rate of 77% which kicks-in at $200,000 or the 61% Income Tax Bracket at $52,000 of earned income, OUR TAXES ARE LOW. 

So, where is the wealth redistribution and Socialism?

Image found at:  http://1040formhelp.com/wp-content/uploads/2008/12/taxsensitivity.jpg

How can you be Taxed Enough Already if almost half don’t pay Federal Income Tax?

How can people claim they are taxed to death when 47% of households will pay no Federal Income Tax? According to the non-partisan Tax Policy Center, nearly 71 million households will pay no Federal Income Tax during 2009. Now, this isn’t to say that these same household don’t pay sales, property tax [renters pay a portion of this through their rent], various forms of state taxes, or payroll taxes. But for all this uproar and angst about the heavy tax burden that so many people are carrying on about, are people really overburdened with taxes or are the ones that are paying the lion share of the taxes overburdened?

There are several schools of thought out there about the most equitable way to share the tax burden, or responsibility. One group wants to eliminate the IRS all together and replace all Federal Taxes with a national consumption tax (a.k.a. Fair Tax) at a 23% tax rate. Then there’s the Steven Forbes “Flat Tax” proposal which would cap all Federal Income Taxes at a certain percentage (say 10% to make the math easy to figure out). This would mean that everyone, over all income levels, would pay the same proportional income tax rate. Then there’s the Progressive Tax system that the United States currently uses, where over the years the tax rates have increased and decreased with the political winds of the nation. Also, our Federal “Progressive Income Tax” system is honeycombed with loopholes, exemptions, and tax credits which shifted the larger tax burden-responsibility to middle income earners.

Keep in mind, this discussion is only about personal income and not corporate taxes, which is a whole other debate. Do we base our tax codes off of a person’s ability to pay or disregard ability to pay and base it off of everyone pays no matter what your individual income level? There is no question that there needs to be massive tax reform and we need to tackle the eternal question again - what is the most fair and equitable tax system to fund the Federal Government. But, I find it disingenuous when a group of people claims they are Taxed Enough Already when most of them will pay little or nothing in Federal Income Tax. So, let’s be real honest here and admit that you don’t want to pay any taxes and expect the country to run and function at the same level or better by defunding all forms of government. We need tax reform, but not the kind that TEA Baggers are pushing.

Is this what a TEA Party activist’s dream world looks like?

This past Thursday, September 17th, TEA Partiers gathered in Lynchburg and in other communities across the nation in honor of “Constitution Day,” to make a symbolic point as they continue to press their anti-tax, less government stance. There is no question that our national debt is massive and we cannot continue to live beyond our means. But, for all the anger and the animosity being fired at President Obama and Congressional Democrats, why are they standing so close to the ones that are the most responsible for our current financial situation?

Cutting taxes for the wealthiest and then engaging in deficit spending during non-recession years started with Ronald Regan. This approach to financing our Federal Government has ballooned our national debt to the levels they are at today. It continued with George H. W. Bush and was only slowed temporarily by the Clinton Administration. During the Clinton years, the size of government was reduced and the amount the Federal Government spent went down as well. In turn, we saw several years of budget surpluses that helped cut into the national debt. Then conservatives and anti-tax advocates had this notion that if there’s a budget surplus then it must mean that taxes are too high and there is no other debt to pay off.

Republicans pretty much had control of the Federal Government from 2001 to 2007 (when the Bush Administration was sworn in to the time that Democrats officially took control). So, it’s pretty misleading when activist groups like the TEA-Baggers put all this on the Obama Administration and Congressional Democrats when the ones standing closest to them (Republicans and Free Market Conservatives) are the most responsible for the economic mess that we are in. Now how does this all fit with a possible, and from all accounts probable, dream world for TEA Party activists?

In the Ohio School District that covers Grove City, the normal sounds on Friday nights these days are the sound of passing cars on the road and chirping crickets at the local High School Football stadium. Grove City is notorious for fighting any tax increase. This is no dream world; this is reality for this working class community. The town voted for a third time in August in a referendum to increase the operating levy for the School District. For a third time, they levy failed to pass and the School Board took the next step – elimination of all extra-curricular activities. This paragraph from the article sums it up best:

The issue has turned neighbor against neighbor and caused shouting matches at school board meetings and on street corners. Those who oppose the levy argue that the district should find a more efficient way to spend the money it already has instead of asking for more tax dollars. The anti-levy crusaders appear to be the majority, evidenced by the fact that the levy already has been voted down three times. Those who support the levy warn that if the district doesn't offer a full program that includes a quality education and extra-curricular activities, parents will leave for another district that does. They also fear that another no vote will force the school board to slice into academic programs, which could trigger a mass exodus. That, they argue, would further erode the tax base and rob South-Western of many of its brightest students. To the pro-levy side, the Nov. 3 vote is nothing short of a referendum on the future of the community.

The situation in Grove City, Ohio should serve as an example of what happens when we don’t fully fund things like schools. Our tax dollars fund programs and services, like schools and infrastructure. I think it’s fair to debate how tax money is being spent. But, to hear the TEA Party activist rail on about being Taxed Enough Already, it’s like the Federal Government is taking every dime they have and they’re out on the streets. What are they really saying? Are they against increasing taxes or opposed to all taxes?

Regardless, taxes serve a purpose and when voters refuse to address critical funding issues that support the common good, the end result is what Grove City, Ohio is going through right now - cutting extra-curricular activities like sports as well as Student Government which helps develop civic skills in our young people. It also makes the community less attractive to potential residents, businesses and industries. Do TEA Baggers support killing communities because they feel they are Taxed Enough Already? I hope not.

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Bold idea: Revisiting Federal Tax Rates of the 1950's and 1960's

This is without a doubt, one of the bravest and boldest suggestions by someone who knows something about business. In an op-ed in today's Roanoke Times, Virginia Tech Finance Professor G. Rodney Thompson suggest that we take a look at raising the top Federal Tax Rate address our National Debt and pay for Healthcare Reform and the laundry list of other things that we have been putting off for far too long. While he doesn't suggest the raising the top Federal Tax rate to the 75 to 92% range that existed during this period, but increasing the top Federal Tax rate to the 50 - 60% level should be more than enough.

There are some things that need to be mentioned that factor into the nation's success during this period. While he does point out that our GDP was consistently over 3.0% during this period, and we were a much bolder nation that didn't complain about taking on a collective challenge that would benefit the common good [Eisenhower Interstate System and the Space Program that put us on the Moon], other things that he doesn't mention is that Organized Labor was much stronger during this period and individual savings rates were much, much higher. This led to the creation of the middle class that we had until the "Great Recession" and also more people were in college and universities than ever before.

We did have significant social challenges, which Professor Thompson points out, but we were not in debt to anyone. Isn't it ironic that when the Regan Era was ushered in and top Federal Tax Rates were cut, that we also saw our national deficit, budget deficits, and personal debt balloon? Something worth thinking about...

Healthcare Reform: Taxing the rich to pay for quality, affordable healthcare for everyone

According to an Associated Press story posted on the Virginian Pilot Online last night, House Democrats are floating the idea of a “surtax” on individual incomes over $200,000 per year and couples with incomes over $250,000 per year. My first response to this is sure. Why not? Didn’t these folks get lots of tax breaks under the Bush Administration and a Republican controlled House and Senate until they lost control in 2006? But, the real value of incomes over $200,000 and $250,000 varies widely geographically.

To play a little “devil’s advocate,” here are a few thought on what will be said of this proposal:

Isn’t this just taxing a person’s prosperity?

Isn’t this is just warmed over wealth redistribution, the next step to
(dare I say) Socialism?

Why should someone making over $200,000 a year be penalized for some else’s
inability to earn a living through innovation and risk-taking and be rewarded
for that lack of skill and savvy?

This is a tax increase. This is worst possible thing that can be done
during a recession, especially one as deep as this recession.

Individuals making over $200,000 per year and couples making over $250,000
per year pay most of the taxes in this country. Why do you want to raise
taxes on these hard working people when they already pay more than their fair
share?

The shouts of “Class Warfare” will travel through the halls of Congress from small government proponents, Tea Bag Party goers, anti-tax conservatives and free market advocates. They will also say, “what about the stimulus money that isn’t getting out fast enough or the TARP money to bail out the GM and Chrysler, or AIG? The economic recovery has been a FAILURE! It’s time to put us back in charge of the Federal Government to halt the march towards SOCILAISM and government run healthcare.” This is just a short list of things that Conservatives will be saying about the “surtax” on incomes over $200,000 per year. The focus will be on the bottom numbers, the $200,000 and $250,000, and not the “above” part. So what does $200,000 of adjusted gross income get a person these days?

Like I said before, the real value of individuals making around $200,000 per year and couples making $250,000 varies widely geographically. For instance the cities and communities in the megalopolis (the area from Boston to Washington, DC), $200,000 doesn’t get you that brand new Honda Accord or the ability to afford a 2,500 square foot house with on a third of an acre of land, supporting a family of four while at the same time trying to save money for college tuition for their kids. $200,000 doesn’t mean the same in real value if you live in places in or around Atlanta, Chicago, Miami, Orlando, or the major cities in California where you are lucky to find a 1,500 square foot house for less than $350,000 or $400,000 that only sits on the ground it was built.

Then again, there are lots of places across this country where earning an income of around $200,000 per year affords you a level of comfort that enables a person or family the opportunity to have that brand new SUV, a home that exceeds 3,500 square feet and sits on an acre of land and the ability to put money away for their kid’s college education. But this all comes down to individual choices on how this money is spent at those levels of income. The one thing that will obviously be glassed over by all these anti-tax conservatives is the fact that individuals earning less than $200,000 or couples that earn less than $250,000 will not be assessed this “surtax.”

So, the question comes down to individuals and couples earning $200,000 or $250,000 (respectively) or more. Have they been paying their fair share in taxes? Again, the focus will be on the magic bottom numbers of $200,000 and $250,000 for conservatives. I haven’t seen the details of the bill or the proposal, but maybe a graduated scale based on geographic cost of living that starts at these levels of income and increases to the target amount of the “surtax,” would be more palatable. The truth is, high income earners haven’t been paying their fair share for a while now and this is one way to nudge them in the direction of investing in healthcare for the common good.