“Anybody who tells you money is the root of all evil doesn’t f***ing have any.”
-Jim Young (Boiler Room)
There has been a lot of talk lately about rich people vs. poor people. In the height of the political season, fingers are being pointed, people are being accused, and even Fortune magazine took time to ask if it is still okay to be rich today in America.
It is Okay to Be Rich
With rich Republicans people yelling class warfare, it is understandable that this topic is getting more attention. I think all this talk about class warfare is a classless political stunt (I made a pun, get it?) that deserves very little attention.
At the end of the day, it is okay to be rich. This is a capitalist country that rewards people who are educated, work hard, and successful with lots of money. I am well educated and I work hard and I hope to have lots of money someday.
Compared to a lot of people my age, I already do have a lot of money. That is not supposed to be bragging. I know many people who have a lot more than me. I am just trying to show that if you work hard and get a good degree (I have a finance undergrad and a finance MBA), good things will happen for you.
If you work hard, you deserve it.
It is Better if You Earned It
There are rich people all over this country who did nothing to earn their money. Cough ::Mitt Romney:: Cough. We all know a college classmate that lived off of a hefty trust fund or someone inherited an absurd amount of money on their 18th birthday. But America does not love those stories.
In this country, we love rich people. They inspire us. But, as most of us don’t have multi-million dollar inheritances and will not win the lottery, we want to see people who made their money themselves through their own hard work and ingenuity.
You Are Still Expected to Pay Your Fair Share
This is the part that the country is most divided on. We almost all agree that everyone should pay their fair share. We agree that rich people should pay taxes. We agree that the middle class should pay taxes. We don’t agree on a definition of “fair share.”
To me, fair share means equal burden. A flat tax is not an equal burden. If we all paid a 20% flat tax on every dollar we made, a person making $30,000 per year would pay $6,000 per year and a person making $300,000 would pay $60,000 per year. However, while $60,000 is a lot more, the $60,000 would hurt the person making $300,000 a year a lot less than the $6,000 would hurt the person making $30,000. Why? The person earning $30,000 per year would have $24,000 left over while the person making six figures has $240,000 left over.
I would not advocate that we should tax the person who earns more down to a point where he/she has the same take home income (a form of communism), I just advocate that they pay a higher tax rate than someone that earns a lot less. If you can’t save up and live well on a six-figure after tax income, you might need to evaluate your spending habits.
What Do You Think a “Fare Share” Means?
What are your opinions on taxation in America? Should we have a flat tax or a graduated system? Do you think millionaires should pay a higher effective tax rate than thousandaires? Please share your thoughts in the comments.
Image by Official U.S. Navy Imagery / flickr
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