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Navyblue

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I've seen a couple of people allude to those making 150,000 ish as being a part of the 1%. on here in this and/or the other occupy thread.

So my question to you since the "occupy" group has come up with such catchy advertising jingles as "1%" and "Occupy ...": what exactly does the 1% look like?

Who is the 1% exactly?

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I've seen a couple of people allude to those making 150,000 ish as being a part of the 1%. on here in this and/or the other occupy thread.

So my question to you since the "occupy" group has come up with such catchy advertising jingles as "1%" and "Occupy ...": what exactly does the 1% look like?

Who is the 1% exactly?

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They look like the people who can buy three houses on their annual salary, which regular folks work 20-30 years to pay off, and still have money left over.

What do they look like? Like doctors who get funds for prescribing certain medications. Like corrupt politicians and bankers. Like weapons contractor CEOs and other leaders of the few global firms that run the world. It's really not that difficult to see what they look like. They are the people running our societies into the ground for their personal benefit.

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We all know about those super-rich, Warren Buffet, Bill Gates of the world, but what about guys like Peter Schiff who is a business owner, who employs people with a fair (probably more than decent wage), who doesn't rely on government handouts or lobbying, and are successful due to the effort and research involved?

He falls into the 1%, but should he be targeted and be forced to pay more? I mean, he's already paying corporate tax, tax from running the business (buying equipment, etc), pay employee salaries (which they pay tax), and then his own personal income he has to pay tax on that too..... to a point where (excluding employees) he is basically paying 50-75% of his income towards tax. Should he be forced to pay more?

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Learn to read a bit, I'm talking about the middle and smaller businesses.

Nope, totally right.

I'm gonna use Peter Schiff's company. I'm assuming it earns 20 million a year for calculation sake.

Federal tax of 38% for those at the very top.

State tax (in this case Connecticut 7.5%, but can go as high as 12%, although it is deductible towards federal tax)

So I'm just gonna say 40% total, since it's a nice round number.

20,000,000 * 40% = 8,000,000

Then personal income tax for the highest earner is 35%

Lets say he takes home half of it (the rest remained in the company).

4,000,000 * 35% = 1,400,000.

Total 9,400,000 already paid for taxes from only 20 million. That's already 47%, and I still haven't included other wage deductible stuff (the USA equivalent of CPP, EI, health plans, etc), property tax, etc. Tack that on to the total and it will be way over 50%. Throw in employee salaries and how much they're paid, the total amount of taxes given to the government from revenue generated by that company will be reaching closer to 75%.

Sure, are companies like GE or other large multi-national corporations probably not paying the approximate amount, probably, but how many large companies are there compared to smaller sized ones? Considering 75% of the population are employed by small to medium size businesses, companies like GE are the outliers, not the general norm.

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Shhh FeStealth stop educated the uneducated on how taxation works.

It's precisely the problem I have with this whole 1% thing. Spoo many sheeps out there.

One person exclaims that "the rich" (whatever "the rich" means) don't pay their fair share of taxes (whatever fair share means) and many willfully bahh along without thinking.

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They look like the people who can buy three houses on their annual salary, which regular folks work 20-30 years to pay off, and still have money left over.

What do they look like? Like doctors who get funds for prescribing certain medications. Like corrupt politicians and bankers. Like weapons contractor CEOs and other leaders of the few global firms that run the world. It's really not that difficult to see what they look like. They are the people running our societies into the ground for their personal benefit.

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We all know about those super-rich, Warren Buffet, Bill Gates of the world, but what about guys like Peter Schiff who is a business owner, who employs people with a fair (probably more than decent wage), who doesn't rely on government handouts or lobbying, and are successful due to the effort and research involved?

He falls into the 1%, but should he be targeted and be forced to pay more? I mean, he's already paying corporate tax, tax from running the business (buying equipment, etc), pay employee salaries (which they pay tax), and then his own personal income he has to pay tax on that too..... to a point where (excluding employees) he is basically paying 50-75% of his income towards tax. Should he be forced to pay more?

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15% only if it's a long-term capital gain, 35% if it's short-term. Anybody who follows the market will adjust their portfolio according and most likely a lot of movements would be made within the short-term, thus Schiff would be dinged personally 35%

As for charitable contribution, it's only up to 50% of your gross income. You pay 50000 out of your 100000 so you can be taxed 50000 less. Potentially you may end up in a lower tax bracket, but you'll have to forking over tons of money and the end results would usually be negligible at best.

But lets just say charitable deduction plus capital gains evens out with property taxes, business licensing, normal business operation tax expenses (you still gotta pay tax on those brand new computers, desks, etc), and other governmental fees..... a guy like Peter Schiff, or the average small/medium business owners still are paying about 50% in taxes.

1 guy has to pay almost 10 million, whereas the average person pays only 10 thousand... yet both are only given the same basic rights. If 10 million from 1 guy isn't enough... so how much would be enough?

Fact: 90% of the people only contributes 30% overall.

Occupy Main Street!

:lol:

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He's not paying corporate tax, his corporation pays corporate tax. Business expenses are not taxes. His private income is what we are talking about, no? Let's see, he pays the same as everybody else per tax bracket, so his highest taxes don't even kick in until he's made over 350,000(?).

Talk about misrepresenting an argument. How about we start counting the average people's expenses as taxes too?

Federal tax is 35%. And you do understand that neither he nor the corporation pay taxes on the money that stays in the company? Ah loopholes for the rich.

20 million revenues. After expenses - not 20 million. Takes the corporation into lower tax bracket. Actually, I'm not going to talk about the corporation because it isn't his income. Let's just jump on over to his personal income, shall we?

4 mil is a nice sum. Let's go - he pays lowest income tax on the first ~8,000, then he pays as per each bracket until his pay over ~350,000 is taxed under the highest bracket. And those tax brackets only go up if he's married. I'm not going to figure out what he pays in taxes after you take into consideration each bracket, but it's safe to say he has a LOT more money left over than his employees. Oh, and if he puts it back into his business, he doesn't pay taxes on it.

Under your example, he pays 1.4mil in income taxes and has 2.6 left over for living (if he doesn't reinvest).

And I didn't bright up any loopholes, tax heavens, etc. that give the rich yet another leg up on everyone else.

Remember, an employee is taxed before he even gets his money. The rich are taxed after they've spent their money.

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Peter Schiff: In Defense Of The 1%

Peter Schiff

Euro Pacific Capital

October 30, 2011

Last week, I spent the afternoon visiting the Occupy Wall Street demonstrations in lower Manhattan. I brought a film crew and a sign that said “I Am The 1%, Let’s Talk.” The purpose was to understand what was motivating these protesters and try to educate them about what caused the financial crisis. I went down there with the feeling that much of their anger was justified, but broadly misdirected.

Indeed, there were plenty of heated discussions. I did little more than ask how much of my earnings I should be allowed to keep. In return, I was called an idiot, a fool, heartless, and selfish. But when we started talking about the issues, it seemed like the protesters fell into two categories: those who generally understood and agreed that Washington caused this mess, and those who could only recite Marxist talking points. It was the latter that usually resorted to calling names once I pointed out the hypocrisy of their positions. They might shout, “the banks have taken over the regulatory agencies, so we need more regulations!” Obviously, this is paradoxical. If they’re blaming government for causing this problem, why would they suggest more government as the solution?

I think some of the leadership of Occupy Wall Street comes from this kind of radical Marxist background – and perhaps they’re smart to intentionally keep quiet about their goals. Because the vast majority of protesters I met did believe in capitalism – they’re just tired of being screwed over by crony capitalism. Noted school-choice activist Michael Strong calls it “crapitalism,” and that’s what it is. It’s a rotten deal for everyone, and they know it.

The problem is that many of these people are under the mistaken impression that Wall Street banks are to blame for this state of affairs. That’s like blaming the dogs for getting into the trashcan. Sure, it’s bad behavior, but the ultimate responsibility lies with the authority figures – in this case, Washington. After all, it’s not the New York metro area that has benefitted the most from this crisis. Rather, the counties around DC are now ranking as the wealthiest in the country. And while wealthy New Yorkers have historically made their living providing essential financial services to the global economy, Washington has always made its living one way: at our expense.

That’s why I have trouble sympathizing with people calling themselves the “99%”, implying they stand in opposition to wealth no matter how it’s earned. I own a brokerage firm, but I didn’t receive any bailout money. In fact, I have to work twice as hard to compete with bigger financial firms that are propped up by the US government. The least I deserve is the ability to keep what I earn.

Remember, if the IRS weren’t taking so much from the wealthy, who have earned it, there would be that much less for Wall Street bailouts. A hundred years ago, major banks had no business lobbying Washington, because compared to their free-market earnings, the government simply didn’t have that much money to dole.

The other tool the government didn’t have to use against us back then was the Federal Reserve. Even if we drastically reduce taxes, the Fed might decide to do what it has been doing: printing money to finance government profligacy. This acts as a secret tax on everyone with a bank account, and is critical in transferring wealth from hardworking Americans to politically connected elites. So, really, the protests shouldn’t be on Wall Street but around the corner on the ironically named Liberty Street, site of the New York Federal Reserve Bank – the heart of the untenable system.

Until these twin sources of financial oppression are brought under control, the average American’s standard of living will most likely continue to fall, more jobs will leave for increasingly capitalist emerging markets, and more young kids will be left with nothing better to do than block traffic.

Also one common refrain was that our problems result from the rich not paying enough taxes. Most feel that the economy was better when marginal tax rates were higher, and that it’s lower rates that are the cause of the decline. Forget about the faulty logic of this assumption, it ignores two key points. The first is that while it’s true that marginal tax rates were once much higher, the tax code itself made it a lot easier to avoid paying those rates. The second is that prior to 1913, the rich paid no income taxes at all, and the economy grew faster in the 19th century without an income tax than it did in the twentieth!

Also, there was a real lack of understanding of basic economic principles. Protesters thought that the rich owed a duty to share their wealth with society. However, what they failed to see is that in true capitalism, that is precisely how the rich acquire their wealth in the first place. No one succeeds in a vacuum. Consider the late Steve Jobs. He became a billionaire by sharing his wealth. Think about the millions of people around the world whose lives are vastly better because of Apple products. Think of all the Apple employees who benefit from high-paying jobs. Think about all those investors who got rich on Apple stock. Steve Jobs shared his wealth with the entire planet before ever paying one dime in taxes. In fact, any money Steve Jobs did pay in taxes likely prevented him from creating and sharing even more wealth. Had Jobs tried to hoard his wealth instead, he never would have acquired it in the first place.

Of course, the idea that Occupy Wall Street protesters have a right to share directly in the private profits earned by others is immoral. The protesters were correct in being outraged by having to share in Wall Street’s losses. But if they do not want to share the losses, they have no right to demand a share of the profits.

One protester equated the low wages paid by Wal-Mart to slavery, yet thought the government should take 70% of my income. In the case of Wal-Mart, employees are free to choose to work elsewhere. What choice would I have when faced with a 70% income tax? They call it slavery when Wal-Mart offers workers better jobs than any others they could find, and justice when government enslaves me by forcibly taking 70% of the fruits of my labor.

Another protester challenged my claim that businesses create jobs by stating that it’s consumers who create jobs by spending money. When I asked him where the consumers got their money, he replied “from their jobs,” which actually proved my point. Without jobs, consumers have no purchasing power. And without production, there is nothing to purchase.

I’m calling for these protesters to educate themselves on the causes of the current financial decline and not to waste their time attacking the wrong target. They have every right to be angry, but also an obligation to be part of the solution. Yes, I am the 1% – but I’ve earned every penny. Instead of trying to take my wealth away, I hope they learn from my example.

http://www.europac.net/commentaries/defense_1

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Peter Schiff interviewing some of those protestors. He's there to education those people (eg. they should be protesting the government for propping up the banks/etc, and not all of the 1% are "Bad").

You can tell a lot of the protestors are misinformed and stuff.

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