Taxes: Scraping by on $400,000 a year
A University of Chicago law professor recently ignited a national firestorm with a blog post complaining about President Obama’s plan to raise taxes for families making more than $250,000.
Pity the poor rich, said Felix Salmon in Reuters.com. University of Chicago law professor Todd Henderson recently ignited a national firestorm with a blog post complaining about President Obama’s plan to raise taxes for families making more than $250,000. With an annual household income of about $400,000, Henderson said that he, his doctor wife, and their children are considered “rich” by Democrats, but are, in fact, barely “scraping by.” Henderson said that after deductions for retirement accounts, payments on his and his wife’s student loans, a $55,000 annual mortgage, $60,000 for private schooling, $15,000 in property taxes, and a $100,000 state and federal tax bill, he only has a few hundred dollars a month in disposable income. The reaction to the blog post was both huge and ferociously negative, said Kashmir Hill in Forbes.com. “Die yuppie scum” was a typical comment. With an “electronic lynch mob” still sending him threatening e-mails, Henderson said, his wife is furious at him, and his family is “on the verge of disintegrating.”
“What was his offense?” said Bob Bluey in The Washington Examiner. Nobody likes paying taxes, but Henderson, apparently, is supposed to be thrilled to pay even more than the $115,000 he now hands to government every year. If Henderson is too “rich” to complain about being gouged by the government, said Reihan Salam in National Review Online, so is every American. “By global standards,” all Americans are affluent—even the middle class and most of the poor. There is, of course, another option for reducing the $1.3 trillion annual federal deficit: The government could go “on a spending diet, rather than the Hendersons.”
Cutting spending would help, said Ezra Klein in WashingtonPost.com, but “we have a very large budget imbalance,” and to cut the deficit, taxes will have to go up. The question is: whose taxes? Democrats hope to minimize the political pain by limiting the tax increase to the so-called rich, but as Henderson noted in his blog post, we tax his family at the same rate as the “super-rich,” who make 10 or 20 or 50 times more and often avoid taxes by sheltering wealth in complex investments or in the Cayman Islands. Eventually, we’ll have to close the super-rich’s loopholes, and raise taxes on the merely rich and probably on the middle class, too. At least then Henderson won’t be the only guy bitching about it.