Hacker News Reader

Comment by internetslave | Hacker News Reader

My honest opinion is the hard working professionals making 150-350k are getting hosed. Pay the majority of taxes in this country so that other people can loot, riot, and collect welfare. Asset prices debasing everyone’s wage due to rampant money printing, and they won’t stop. Money printing is a tax on the professional class. Being a hard working professional in this country is losing its allure, and is increasingly a suckers bet.

“ Work hard! Don’t worry if we print money and triple the cost of your house and new mortgage! You are in the top 15%! Look your class only pays 20% of the taxes, never mind all that money we printed! It’s not a tax!”

There’s a serious level of subversion about what’s going on economically in this country.

View on HN

The notion that people making $350K are having a particularly rough time is nuts.

As for inflation, it's threatening to price people under your $150k/yr cut-off for "hardship" out of decent housing even in mediocre cities, ever, and may eventually hurt creditors some (which, I mean, that's a fine outcome according to most people, I'd think). Those with $150k+ salaries had damn well better have some assets to their name, including maybe a (mortgaged) house, and so will ride the inflationary wave alright. Those with little or nothing, on the other hand, may now never be able to afford anything. Young workers just starting out, who have high-ish income but only because they live in a place with insane housing prices, are getting screwed, too, sure, but established professionals will be fine, unless they've somehow managed not to acquire assets over the years.

Pity the normal couple with $60,000/yr household income. Believe it or not, they raise kids on that income. Go figure.

I wouldn't trade places with someone getting by on unemployment for their $12/hr job they were laid off from, certainly. I don't think they're "looting". We're clearly top-heavy on capital, given how the markets are behaving, so I think I've got a better idea of where the looting's happening.

So you're saying that it's the high earning savers that are screwed but professionals that took a mortgage will ride the inflationary wave. Got it. Everybody most be over-leveraged for the system to work.

What on earth are you talking about? I'm in that class. I'm sitting here in an air-conditioned room in a $1500 chair in a four-story townhouse looking at my window at an unobstructed downtown skyline view, sitting with a mini-fridge full of my favorite drink in arm's distance, an OLED on the wall, a king-size bed with a separate laptop right next to it so I can hop in and work laying down whenever I feel worn out. My life is fantastic.

As for mortgage cost, rates are the lowest they've ever been. I just refinanced to cut my payoff time in half keeping the payments almost exactly the same. The property values are shooting up, but I already own the property, so how does that hurt me? It's wealth, not an expense. 401k and IRA are doing fine. What do I care if the real value of the couple grand I keep in checking as bare dollars is going to be nothing in 50 years? That's a tiny portion of holdings and I'll be dead by then anyway.

I don't understand complaints like this. If anyone is getting hosed, it's people in the 40-60K salary range. Just enough to not qualify for any kind of public assistance, but not enough to not be living paycheck to paycheck and forced to rent forever at perpetually increasing prices so property owners like us can get rich.

As for other people are doing, I guess looting and rioting happened somewhere since it was on the news. But again, I live downtown smack dab in the middle of a major metro. I'm watching what these people are doing in full public view every day. Mostly, they're either living in tents next to the highway or they're out in the sun for 12 hours every single day hauling wood and stone to put up new condo developments all over the place for the benefit of homebuilders and people like me with enough money to buy downtown condos. As far as I know, the bulk of protesters in any activist movement are well-off suburbanites who can afford to take time off work or college students.

I promise you that you are not "getting hosed" lol. The absolute silver spoonery of that statement. The people getting hosed are the essential service / warehouse workers making <$15 an hour with no paid sick leave. I can't believe you make 6 figures to stare at a screen and think you're getting bad deal. The lack of adversity on this site sometimes...

This is the person (the OP you replied to) who wears pink polo shirts and khaki shorts and lives in a gated community and cosplays with guns.

Idk where you get your data, but that slice of earners you mention pays maybe 20% of the taxes In This country, tops (assuming you mean USA).

https://taxfoundation.org/summary-of-the-latest-federal-inco...

Work hard! Don’t worry if we print money and triple the cost of your house and new mortgage! You are in the top 15%! Look you only pay 20% of the taxes, never mind all that money we printed! It’s not a tax!

So you agree with me that one premise was wrong, but you want to double down on your other premises, which are less wrong, but still lack meaningful nuance?

Chill.

I’m saying the tax argument is flawed. They are debasing wages and acting like that’s not the case

I feel you brother but you're mad at the wrong people.

It's banks and REIT's and corporations and foreign investors buying up houses, not poor people.

Where did that money go to? To the "socialist" stimulus checks?

The majority of money printed was loaned out to banks and other institutions, which promptly put that money back into the stock market and other investments.

Think about it this way. Would you rather have your investments crash and pay the same taxes, or take the tax increase and also have your investments go up? If you would prefer the second, you benefited from the government's actions.

In fact, I feel the lower class were the ones that the government took from, in the form of impending inflation.

Yeah, it's a loan, when you pay the loan back the money supply actually ends up contracting again and only the residual interest payments are actually added to the economy.

It's noteworthy that this would still be about seven times as much as the entire bottom 50% of income taxpayers.

Do you expect everyone to pay the same amount of taxes?

No, I don't.

My turn: do you expect more than half of all households in America to be paying no federal income tax at all?

Why would they pay income tax, if the point is to redistribute the money collected back to them?

Seems like instead of collecting $x amount of tax from them in order to give it back in benefits, we could just not have them pay tax (which is the case currently).

The real answer is - raise their wages, and then they will be paying more in federal taxes (just like the upper quartiles are).

USA lower tier professionals (Doctors, Lawyers, Programmers, have a anticompetitive racket - they should all get a 20-30% net haircut in salary, tech should be regulated, we should increase admission to med-school and allow nurse practitioners to serve as doctors, etc.). I say this as someone who benefits greatly from the current system, but also realizes how fucked up it is.

Finance people should be taxed out the wazoo - watching stocks tick up and down on the market is a waste of time and most of them defraud people anyway, estate and wealth tax should be a thing, if they try to denounce citizenship to get away, immediate tax of 50% of [unrealized] profits (we currently do 20%).

Even that wouldn't get us back to how things were in the 1960s, but it would at least be closer, and probably makes things better in the mean time.

I'm not denying that programmers get paid a lot or that our taxes shouldn't be higher but it's a different situation from being a doctor or a lawyer. I have no degree and am entirely self-taught. I would not be able to practice law or medicine without getting one. However, I am a professional software engineer.

Programmers get paid a lot because the market is extremely competitive. Doctors get paid a lot because healthcare in the US is essentially one massive cartel and incredibly inefficient as a result. In most countries, doctors and programmers make similar salaries.

I think the term "software engineer" is sort of meaningless. I know someone who builds ssis packages and while he does know T-SQL, he is relatively unfamiliar with transactions, cannot describe how a balanced tree index works, and will not complete an SQL query without using "nolock".

I have never seen him produce a working program in any dot net language, or for that matter any procedural language except maybe visual basic for applications (excel macros maybe). I think he tried to learn php but gave it up. He also calls himself a software engineer. He makes some good money tho, he's in management.

I rarely see this with other engineering disciplines. Its always the computer programmers lol

Just 2 cents from the peanut gallery!

Sure, anyone can call themselves that, but if you give me a resume with only SQL on it and you want a programming job, I will definitely start asking about other languages and trying to gauge general experience.

I don’t really care what you call me but I will call myself a software engineer because I have a depth of understanding in how to solve problems with software in a consistent way. I’ve always had an engineering mindset, I grew up in a family of engineers. It’s just the term I prefer.

ok fine, you're an engineer!

I’m not sure why that’s noteworthy. We have a progressive taxation system with a tax-free allowance and various deductions for things like dependents that reduce taxes at the bottom of the income range. So there is always going to be some number n which is the ratio between the amount of taxes paid by higher income group X and some lower income group Y and... sometimes it’s going to be 7. Is 7 too big? Too small?

Median income tax is about 10k on 65k of income so people in the bottom 50% pay between 0 and 10k on between 0 and 65k of income.

If you’re earning 200k or so you pay a similar amount of tax on the first 65k of your income.

But yes, you pay more tax on the extra 135k you’re making. But that’s okay, because you’re making an extra 135k. You can afford it.

I do understand the concept of progressive taxation.

$65K is an average household income, but there's no way that the average household is paying $10K in federal income tax, that's laugh-out-loud far of the mark.

Let's just say that's a couple married-filing-jointly.

In 2020, you'd take first of all a $24,800 basic deduction. Then you'd pay $4,429 in income tax on the $40,200 taxable income.

If you had two kids, you'd take two Child Tax Credits for $2,000 each and pay $429 in federal income tax.

An average household with two kids pays essentially no federal income tax in 2020.

Even in the absolute worst-case, a single filer pays no more than ~$7,400 on $65,000 of income.

In 2021, thanks to the increase in the Child Tax Credit ($3000 per child or more younger children), the bipartisan Joint Committee on Taxation estimates that the average household will pay no federal income tax at all on income under $75,000 per year.

Sure, but payroll taxes (~7.5% + 7.5% employer contribution) are a thing and that's another ~$5000 (or $10,000 if you include employer contribution) that the household has to pay.

Also as grandparent mentioned, you pay exactly the same amount of taxes on your first $65K as the person making $65K does.

https://www.taxpolicycenter.org/sites/default/files/styles/o...

I'd be really curious what your opinion is informed by since I don't see any data to back it up.

Those in the Top Quintile (~200k in 2010 and ~250k today, so right in the middle of your proposed hosed bracket) have seen the greatest increases in Mean Income in the last decade [^1 p.8]. Those in the Upper Income bracket (~190k in 2000 to 207k today) have seen a 20% increase in wealth in the last 30 years while lower brackets have declined [^2].

Do you have any data to backup your assertion that "being a hard working professional in this country is losing its allure, and is increasingly a suckers bet"? These jobs seem to have a much greater increase in wages [^3 Fig. F][^4 Fig. 1] (4x in the last 40 years) than those in all other lower income groups. I'm not sure how anyone could come to the conclusion that increasing wealth and top of the pile wage growth are "a suckers bet".

[1] CRS The U.S. Income Distribution: Trends and Issues - https://fas.org/sgp/crs/misc/R44705.pdf

[2] Pew Research "Trends in income and wealth inequality" - https://www.pewresearch.org/social-trends/2020/01/09/trends-...

[3] Economic Policy Institute - "State of Working America Wages 2019" https://www.epi.org/publication/swa-wages-2019/

[4] CRS "Real Wage Trends, 1979 to 2019" - https://fas.org/sgp/crs/misc/R45090.pdf

> Those in the Top Quintile (~200k in 2010 and ~250k today, so right in the middle of your proposed hosed bracket)

Actually, not. Your numbers are household, not individual quintiles; the proposed “hosed" bracket bracket is about about 92nd-98th percentile by individual income.

> the proposed “hosed" bracket bracket is about about 92nd-98th percentile by individual income

The figures get even worse in this case. The 95th percentile of individual income has far greater wage and wealth growth over the last 40 years.

Based on numbers from the U.S. Census Bureau, over the past twenty five years, the 95th percentile income household has grown from an aggregate share of income of 21.2% (in 1994) to 23.0% (in 2019).

Yes those hard working professionals making 350k are really getting hosed /s. Time to quit and go on food stamps.

You’d rather be collecting welfare than making $150k?

It’s getting to that point, absolutely. You live one time, and are spending it paying for others. This is out of control

As someone who lived on poverty wages and now makes significantly more: No, you do not.

You should try it some time. It’s not fun.

Yeah we all think this, jumping out of tech and buying a transam and taking a relaxing job and smoking pot when our wives aren't around.

Anyway, remind yourself of how you couldn't afford that $80-150/mo gym/class. How you didn't go on a real vacation for years because it took 8mo+ to save up for one. How you probably drove a car that constantly broke down because you couldn't get a loan on something decent. How you had to save money from your $6/hr job to eat Burger King on your lunch break across the street. How a huge chunk of your income went into driving yourself to work (gas/maintenance). How you couldn't afford a place without 3-4 roommates. How you went for years without buying a set of 4 tires, instead buying 1 used tire to replace your bald tire before the police/rain gets you.

I'll take the 150k stresses over my previous $6-12/hr stresses where I felt like I was spinning tires and never, ever going to get out of that.

You're spending a portion of what you make to stabilize society and prevent poverty-driven riots across the country during a global pandemic. There's nothing out of control about it

Are you a parody account?

You would choose welfare over a $150K salary?

What’s wrong with paying money so others can live? I see a lot of life as chance. I’m lucky that I grew up upper middle class with parents who paid for college. Now I got a cushy job as a software engineer. I could have just as easily been born to a family with 0 wealth and had to start working at a young age and do that until I died. Why shouldn’t we have a safety net to at least cushion the blow of getting a bad dice roll at birth?

> What’s wrong with paying money so others can live?

Nothing if it's voluntary.

> I grew up upper middle class with parents who paid for college.

I didn't.

> I could have just as easily been born to a family with 0 wealth and had to start working at a young age and do that until I died.

I was and would likely not end up dead with 0 wealth if I can manage to keep some of what I'm now generating.

I have bad news for you: dead people can’t keep their wealth.

Dead people's families can. The parent poster talked about being `lucky` in that his parents could pay for his college. I want my kids to be `lucky` enough to afford housing and _if they really want_ college.

I grew up poor, was homeless at 16 for a year while still trying to go to HS, eventually had to drop out and climb up the career ladder with no formal education, now make well into 6 figures and I'm more than happy to help people NOT have to go through my situation. You should be as well. I am beyond lucky that I dug myself out of that hole and I know other people will not have my luck. If I didn't start programming as a kid because my school got computers early I would probably be in retail still.

And evidently your luck, as well.

Again, voluntarily sure. I view redistribution of wealth via force to be a net negative on the wealth of society.

> evidently your luck, as well.

I worked at a Burger King, a hardware store, an apartment complex (plumbing toilets and whatnot), and finally put my self through college. It was an exhausting climb the whole way and I _worked_. I was never let go, and I hardly (like a $1500 a pell grant once) received assistance because I _made too much_ in my day job when I finally did go to school.

I wasn't terribly lucky other than I `lucked` into a work ethic and I `lucked` into being born in a country that still had enough of a free market that I _could_ work my way up.

And thinking on it now I don't think I was that well served by my schooling. I feel if anything I was held back in an _almost_ deliberate effort to homogenize me.

If it were voluntary would you contribute?

I do contribute locally, and I donate to media sources and causes I believe in.

I should add that I also support local farms and businesses now that I have the funds.

> It’s getting to that point, absolutely

I'm guessing you’ve never lived on welfare. Having done that and had a.personal income that, while short of $150K, is a sizable fraction of it (and been everywhere in between), increasing real income has involved a monotonically increasing quality of life. I’m definitely into the range, even short of $150K, where the marginal difference from each additional $ of income is much smaller than at lower levels, but it is still not negative.

Best you can do is take what your salary affords now and jam it into leveraged assets. Preferably assets that you can pick up and leave with.

This is probably 90% of the reason for the crypto boom.

While this is written in an inflammatory tone, they key takeaways are inflation are rising and income from the government as a proportion of total income are increasing and never been higher, respectively.

Jeffrey Gundlach had a great recent presentation on these trend reversals that is worth considering:

https://youtu.be/gy65QvvsXPI

At this pay level, you can easily become an asset owner. You're supposed to become a home owner and a stockholder (at least through your 401k). Don't even pretend that anyone in that range has it rough.

This is such an inflammatorily bad take that I suspect it's trolling at this point.

African Americans do not collect the majority of welfare in this country. Sops to multi billion dollar corporations like WalMart - why is that not welfare?

A trillion dollars of HNW tax evasion happens every year, simply because the IRS is underfunded and understaffed - why is that not the problem?

And isn't asset price inflation a direct outcome of inequality? Lower money velocity leads to asset bubbles - this is something we know of since the French Revolution now.

Wow, okay. People making 150-350k are doing just fine. The majority of people making under that amount are not looting, rioting, and collecting welfare. They are also hard working people, who are earning far less than the value they create for shareholders. You want to talk about a sucker's bet? How about working 39 hours a week for a mega corporation that earns billions in profit, but still won't pay you enough that you have to turn to the state for healthcare and food subsidies.

> My honest opinion is the hard working professionals making 150-350k are getting hosed. Pay the majority of taxes in this country so that other people can loot, riot, and collect welfare.

There is a lot of confusion here to unpack, but the central idea, that taxes pay for the government is the key confusion. Taxes are a means of wealth redistribution and method to curb inflation. Taxes don't fund the federal government - it can print money just fine.

> My honest opinion is the hard working professionals making 150-350k are getting hosed.

They...aren’t. It’s true that that group, the 92nd-98th percentile by income in the US, are bearing a somewhat heavier burden than they probably ought to in order to support the illusion of tax progressivity while hyperrich capitalists skate by relatively untaxed, but that’s very much not “getting hosed”, especially compared to the at-least-equally hardworking people much lower on the economic scale

Do you really think an honest hardworking professional making 150-350k would trade their lifestyle for that of people who are collecting welfare? They're free to quit their jobs at any time and start collecting that welfare money!

It’s not at that point yet, but now more than ever as a hard working professional you are carrying others on your back. Massively inflating asset prices are like stealing money out of your pocket if you aren’t fully invested and leveraged. If the shame of living on welfare ever disappear, and safe poor neighborhoods are in high supply, watch men drop out. It’s already happening among millennials

You can do four things with your money.

Spend it, which creates new jobs.

Invest it, so businesses can create new jobs.

Lend it, so borrowers can spend it on your behalf.

Do nothing and let people stay unemployed.

Considering the lack of demand for credit indicated by low interest rates, lending is almost the same as doing nothing.

The last option causes deflation which requires the Fed to step in and increase the money supply until inflation hits the target inflation rate of 2%. Right now it is around 2.6% which is pretty much as perfect as it gets. Not too low, not too high.

Highly simplified: People are stealing USD and the Fed has to compensate for the loss except the Fed is distributing the new money very inefficiently which causes collateral damage in the asset markets.

Shaky numbers but I think you're generally right!

At that level of income and likely technological knowledge, nothing prevents you from moving somewhere else cheap, buy a house with your savings and use your professional knowledge to start a remote business.

Sure, a lot of factors to consider but I think you can find a better bang for your buck.

Go where you're treated best!

If I were American I would have renounced my citizenship long ago (mainly for the taxes on worldwide income when not resident in the USA).

Most of Europe is not much better though, it's actually pretty comparable to the USA (more expensive housing, lower salaries, cheaper healthcare).

Money printing is a tax on everyone. More so on the poor, who have fewer assets that inflate along with the money printing.

> Money printing is a tax on everyone.

Its a “tax” (a reduction in real value held) on holders of dollar denominated assets, transferring value to holders of dollar-denominated liability.

> More so on the poor, who have fewer assets that inflate along with the money printing.

The poor tend to have most of their gross assets in tangible non-financial assets (like a car and other durable goods), which do tend to inflate with general inflation (they may depreciate independent of inflation.)

In terms of dollar denominated items, the poor tend to be net debtors, and inflation reduces the real value of that debt.

> transferring value to holders of dollar-denominated liability.

And also, of course, recipients of the new dollars.

When you buy overpriced stocks, where is the money ending up? Is it ending up with the poor, who are selling overpriced stocks?

utterly insane opinion to have. i cannot fathom the mind of someone who thinks this way.

It's someone that believed the story and now sees the game has many more strings attached and the political class is throwing this promise to the dogs.

Sometimes even the beasts of burden rebel. Though it may seen they should be grateful for getting their guaranteed hay at the end of the day.

Reply on news.ycombinator.com