gross national hapiness index

[FireIceTalon]

I think we've talked about this before, but the difference between the rich and the middle class here is that the wealthy earn more income through investments which are taxed at 15% (and allow for deduction of capital losses over successive years), while the middle class pay between 15% and 34% depending on their income levels. Here is why, as a percent of total income, a person like Warren Buffet can pay less than his secretary.

As a (slight) aside, what's the popular definition of "middle class" these days? I'm used to it being manager-level and above, generally white collar, but a lot of the political rhetoric about the middle class seems to be talking about what I would call the "working class" or the perennial "working (wo)man". Has that terminology gone out of vogue in the mainstream? For example, according to Wiki individuals with a marginal tax rate of 15% in the U.S. would make less than $35,350 after deductions. Perhaps the PC police think it's more polite to lump everyone into a middle class. Simpler to just say the 99%.

The reason I ask is that a significant income can be derived from investments by anyone who isn't living paycheque to paycheque, even if it's just a retirement savings that reinvests earnings. And even then, I would venture that many people who are living paycheque to paycheque are in need of a reality check on the lifestyle their salaries can support.

To AngrieCommie's (Edit: whoops, Eppie's) original point, here in Canada we have an investment vehicle (they call it a "Tax-Free Savings Account" or TFSA) which allows for investment income [b]to not be taxed at all. Granted, there is a limit to what you can contribute and withdraw from the TFSA, but in my experience it's been a fairly popular policy across most of the population, including myself. A lower tax rate on investment income, capped or progressive instead of flat, isn't necessarily a Rich-first policy. In my opinion it can provide significant benefit both at the individual and economy-wide levels.[/b]

Spoken like a true Capitalist. Sorry, I couldn't resist.

"I would venture that many people who are living paycheque to paycheque are in need of a reality check on the lifestyle their salaries can support."

^^This seems like a pretty loaded statement to me. If someone is living paycheck to paycheck, chances are they do not have the means, to live beyond their means. Usually the people who live beyond their means are those in the middle-upper middle class that like to go out on binges or max their credit cards - do to any number of reasons - perhaps from working long stressful hours, or just simply an overzealous love of material things, or it could just be from living in a Capitalist society that pushes forth consumerism - only to find themselves in debt. Such things are difficult to measure, but those who struggle from paycheck to paycheck to begin with is probably more do to the salary itself than their lifestyle.

As for low taxes on investment income - It is always a rich first policy from the perspective of those who do not and often cannot invest. This is just part of the so-called 'trickle down' theory, which has proven time and again, that it DOES NOT work (but what the heck, lets give it one more shot aye?). Maybe in Canada, which like European nations, has a larger social welfare state, somewhat less corrupt government, and a smaller gap between rich and poor, it produces a less compound negative result - when compared in the hyper-Capitalist USofA. Nevertheless, geopolitics aside, the basic principle is that those who make more, should pay more - and that's all too often not the case.