# $200K/year isn't rich. Why aren't we taxing corporations? **URL:** \ **Category:** Great Debates\ **Created:** [September 12, 2011, 11:36pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110 "2011-09-12T23:36:21Z")\ **Posts on this page:** 20\ **Page:** 26
**Author:** ![Starving\_Artist](https://avatars.discourse-cdn.com/v4/letter/s/aeb1de/32.png) [@Starving\_Artist](https://boards.straightdope.com/u/Starving_Artist)\ **Post date:** [March 19, 2013, 5:28pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/501 "2013-03-19T17:28:02Z")
> [@Voyager](#): > > Richness is a measure of income - Michael Jackson was still rich even though his finances were a mess. I disagree with both these statements. “Rich” refers to accumulated wealth, not income. It’s only been in the wake of the Obama administration’s efforts to ding the “rich” to pay for everyone else’s needs that ‘rich’ has come to be applied to what is otherwise merely an affluent income, for the simple reason that there aren’t enough truly rich people to foot the bill. So a wider base is needed, and that is most easily accomplished by convincing the nation’s have-not voters that affluence of the type that can afford to feed a family three meals a day at McDonald’s = “rich”. Secondly, prior to securing his multiple concert gig in London, Jackson was having trouble keeping a roof over his and his kids’ heads. His estate is worth much, just like Elvis Presley’s, but at the time of their death both had exhausted most of their real wealth, though each was still capable of earning a large income. > [@Voyager](#): > > Just don’t plead poverty while eating like a drunken sailor. Not to belabor the point, but I don’t really think feeding your family on the cost equivalent of three meals a day at McDonald’s qualifies as eating like a drunk sailor. ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [March 19, 2013, 5:37pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/502 "2013-03-19T17:37:42Z")
Works the other way as well. There was recently a thread on your cheapest meal. Some dopers have been homeless…when meals are stolen condiments, someone making $40k a year seems rich. Even for me, rich has different meanings. By one meaning, rich means you have Bill Gates sort of wealth, by another, it means you have financial independence (which we should all be striving for by retirement), and still another, it means being about to be pretty comfortable without a lot of worries. By the third definition I’m rich, but I’m not going out and buying a Porsche anytime soon, or booking three weeks in Lucerne to relax. And if neither my husband and I worked, we wouldn’t be comfortable forever…longer than most, but for the rest of our lives. ---
**Author:** ![Malthus](https://avatars.discourse-cdn.com/v4/letter/m/85f322/32.png) [@Malthus](https://boards.straightdope.com/u/Malthus)\ **Post date:** [March 19, 2013, 5:43pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/503 "2013-03-19T17:43:48Z")
I’d put it this way - middle class people tend to scrimp and save in the hope that when they retire they will be able to live more or less as if they were still working. Upper middle class people are able to actually achieve this. To my mind “the rich” are people who could afford to live like this whenever they want - they have an asset base sufficient to keep them in reasonable upper middle-class comfort, without the necessity of working (if they so chose) - or would have, if they didn’t blow it all in various ways. ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [March 19, 2013, 6:50pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/504 "2013-03-19T18:50:47Z")
> [@Malthus](#): > > I’d put it this way - middle class people tend to scrimp and save in the hope that when they retire they will be able to live more or less as if they were still working. Upper middle class people are able to actually achieve this. > > To my mind “the rich” are people who could afford to live like this whenever they want - they have an asset base sufficient to keep them in reasonable upper middle-class comfort, without the necessity of working (if they so chose) - or would have, if they didn’t blow it all in various ways. It probably isn’t a bad way to put it. Lower middle class people can’t afford to save for a comfortable retiment, even with scrimping and saving and the poor think its completely unreasonable. And anyone who lives like they are one step up the wealth ladder is doomed to take a fall…upper middle class people who spend like they are wealthy, middle class people who spend like they a upper middle class… That is a good way to get yourself some downward mobility. But anyone who can live like they are one step down the ladder from their income/assets has a pretty good chance of moving a step up the ladder over time. ---
**Author:** ![Malthus](https://avatars.discourse-cdn.com/v4/letter/m/85f322/32.png) [@Malthus](https://boards.straightdope.com/u/Malthus)\ **Post date:** [March 19, 2013, 7:05pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/505 "2013-03-19T19:05:14Z")
> [@Dangerosa](#): > > It probably isn’t a bad way to put it. Lower middle class people can’t afford to save for a comfortable retiment, even with scrimping and saving and the poor think its completely unreasonable. > > And anyone who lives like they are one step up the wealth ladder is doomed to take a fall…upper middle class people who spend like they are wealthy, middle class people who spend like they a upper middle class… That is a good way to get yourself some downward mobility. > > But anyone who can live like they are one step down the ladder from their income/assets has a pretty good chance of moving a step up the ladder over time. Sadly I see a lot of that among my friends. They have the same income I have more or less, but they live like they are wealthy - but all hand-to-mouth. My best friend is also a lawyer, his house is beautifully renovated, he and his wife both have (leased) luxury cars, and they take fancy and expensive vacations, and electronic toys, gagets and services are expensive and they have them all … but every cheque goes to payments. They have debts and no savings other than equity in the house. I had a bit of a heart to heart with him about this over Christmas - unfortunately he is willing to live more sensibly but his wife wants to project a certain image of success to her family, and that requires the fancy home, the nice cars, etc. and he does what she wants. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [March 19, 2013, 7:22pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/506 "2013-03-19T19:22:36Z")
> [@Starving\_Artist](#): > > I disagree with both these statements. “Rich” refers to accumulated wealth, not income. It’s only been in the wake of the Obama administration’s efforts to ding the “rich” to pay for everyone else’s needs that ‘rich’ has come to be applied to what is otherwise merely an affluent income, for the simple reason that there aren’t enough truly rich people to foot the bill. So a wider base is needed, and that is most easily accomplished by convincing the nation’s have-not voters that affluence of the type that can afford to feed a family three meals a day at McDonald’s = “rich”. So, you think Michael Jackson was not rich. For the most part, people with accumulated wealth also have lots of income - the only exception I can think of is the lottery winner who takes a lump sum and puts it under a mattress. But it seems odd to me to have person A and person B, both making say $500K a year, being treated differently if one saves a good bit of his money and the other spends more than all his money. I trust you don’t support a wealth tax, which would be the logical thing if we considered richness as a factor of accumulated money. Rich means some number of standard deviations above the mean. You’ve got to set the limit somewhere, and “rich” is a convenient shorthand which works for people very close to or below the mean. The important thing is whether someone makes enough money to have enough discretionary income so that a small tax increase will not be painful. Thus we have a progressive tax. If we need the money to pay off Bush’s War, where else do we get it besides using the Willie Sutton principle? As for McDonalds, we all know that restaurant meals are far more expensive than meals you cook yourself. If for some reason Terr and his family had to eat at McDonalds that would be one thing, but they are smart enough and lucky enough not to. People who choose to eat out all the time are making use of discretionary income just like those who buy relatively expensive groceries. It is a luxury I suspect your friend’s sister can’t afford. He has the freedom to buy healthy food, which is great, but lots of people don’t have that luxury. > [@](#): > > Secondly, prior to securing his multiple concert gig in London, Jackson was having trouble keeping a roof over his and his kids’ heads. His estate is worth much, just like Elvis Presley’s, but at the time of their death both had exhausted most of their real wealth, though each was still capable of earning a large income. That’s why I used him as an example. He blew his money on his zoo and other crap. Should he have been excused from paying taxes on his royalties because he was stupid with his money? Should wasters be rewarded and the frugal punished - outside of qualifying for college assistance for your kids, that is. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [March 19, 2013, 7:28pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/507 "2013-03-19T19:28:11Z")
> [@Dangerosa](#): > > It probably isn’t a bad way to put it. Lower middle class people can’t afford to save for a comfortable retiment, even with scrimping and saving and the poor think its completely unreasonable. > > And anyone who lives like they are one step up the wealth ladder is doomed to take a fall…upper middle class people who spend like they are wealthy, middle class people who spend like they a upper middle class… That is a good way to get yourself some downward mobility. > > But anyone who can live like they are one step down the ladder from their income/assets has a pretty good chance of moving a step up the ladder over time. Exactly, and having money has all sorts of advantages that help you get more. You can pay cash for a car and not have to pay high interest on a car loan. You have no credit card debt, even after an emergency. And you can afford higher yielding investments. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [March 19, 2013, 7:46pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/508 "2013-03-19T19:46:31Z")
> [@sachertorte](#): > > A long time ago my aunts and uncles took me out to dinner in San Francisco (fancy restaurant). I was shocked at the prices. 12 dollars for soup! Now that I’m older and pulling in a higher wage, 12 dollars for soup doesn’t seem exorbitant to me (or even higher due to inflation), but I’m sure it is to many. Now I look at menus and see 1/2 oz of caviar for 95 dollars! Holy crap! If I’m lucky, maybe someday I’ll look at 95 dollar caviar and be ho-hum about it. That’s the marginal utility of money at work. Now that $12 is worth a lot less to you than it used to be. I’m sure you noticed that the incremental value of an extra dollar decreases faster than linearly. > [@](#): > > Edit: By the way, everyone seems to be accepting that private school isn’t indicative as “rich.” I don’t know how things go now, but back in the day, only rich kids went to private school. Not all parts of the country are like NY. In many places religion drives people to private schools, and sometimes perceived problems with public schools. I don’t know about today but 35 years ago my wife looked into teaching at one in Louisiana, and they paid so little that it wasn’t even worth it - so I can’t believe they were charging and arm and a leg. ---
**Author:** ![SmellMyWort](https://avatars.discourse-cdn.com/v4/letter/s/ea5d25/32.png) [@SmellMyWort](https://boards.straightdope.com/u/SmellMyWort)\ **Post date:** [March 19, 2013, 8:32pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/509 "2013-03-19T20:32:35Z")
> [@Terr](#): > > Dude, that’s the price. FIOS cable, internet, phone and wireless plan come to about $360 a month. Including taxes, of course. Yes, first couple of years it’s less. But then the introductory offer ends and switching is way too much hassle. Way too much hassle…if you’re rich. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [March 19, 2013, 9:45pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/510 "2013-03-19T21:45:43Z")
> [@SmellMyWort](#): > > Way too much hassle…if you’re rich. They’d never make these offers if only rich people didn’t switch. People have a lot of inertia. In “Nudge” Cass Sunnstein, who studies this stuff, admits that he is a sucker for introductory offers for magazines which he then never cancels. We are not nearly as rational as we’d like to think. ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [March 19, 2013, 10:23pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/511 "2013-03-19T22:23:40Z")
> [@Voyager](#): > > Exactly, and having money has all sorts of advantages that help you get more. You can pay cash for a car and not have to pay high interest on a car loan. You have no credit card debt, even after an emergency. And you can afford higher yielding investments. Money makes money. And not having money costs money. But Malthus’ friend probably doesn’t have his money working for him - and I’d lay decent odds that if tomorrow he suffered a tragic brain injury and couldn’t work, he’d be more screwed than a lot of people making a quarter what he does or less. Despite his income being large, he is likely at the “costs money” end of the equation. If that’s “rich” I don’t want to go anywhere near it. But on the other hand, there are people who make a less than median income who live beneath their means and are at the point where their money makes them money. My husband worked with a guy - barely more than a kid. Who had managed to turn a talent for computers and living with his mother into half a dozen rental homes, when one was paid off, he’d buy another. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [March 20, 2013, 12:12am UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/512 "2013-03-20T00:12:59Z")
> [@Dangerosa](#): > > But on the other hand, there are people who make a less than median income who live beneath their means and are at the point where their money makes them money. My husband worked with a guy - barely more than a kid. Who had managed to turn a talent for computers and living with his mother into half a dozen rental homes, when one was paid off, he’d buy another. True - but it is easier to live beneath your means if your means are bigger. Even when you are lazy like I am. ---
**Author:** ![Fear\_Itself](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fear_itself/32/19637_2.png) [@Fear\_Itself](https://boards.straightdope.com/u/Fear_Itself)\ **Post date:** [March 20, 2013, 1:59am UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/513 "2013-03-20T01:59:55Z")
> [@Starving\_Artist](#): > > The problem is that income doesn’t define wealth. But it does define rich. ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [March 20, 2013, 2:42am UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/514 "2013-03-20T02:42:18Z")
> [@Voyager](#): > > True - but it is easier to live beneath your means if your means are bigger. Even when you are lazy like I am. Yep, not disputing that at all. Although I think its really easiest to live beneath your means then you are not “very well paid” -Its the Malthus’ friend’s problem. You start to make $200k a year and you think you can afford everything. And people expect it (not the least being your wife and your family, who often appear with their hands out). Making $200k a year in a “high powered job” and driving a Mazda Protege just doesn’t cut it. $200k a year is, no doubt, a lot of money (although, as pointed out, more in certain parts of the country than others). But it isn’t so much money that you can impulse spend on luxury items while living in a really nice house, paying for private school for your two kids, save for retirement and college, and buying a new Mercedes every year. Yet you reach that level of pay, and those things are “supposed” to be part of the package. ---
**Author:** ![Starving\_Artist](https://avatars.discourse-cdn.com/v4/letter/s/aeb1de/32.png) [@Starving\_Artist](https://boards.straightdope.com/u/Starving_Artist)\ **Post date:** [March 20, 2013, 4:05am UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/515 "2013-03-20T04:05:18Z")
> [@Fear\_Itself](#): > > But it does define rich. No it doesn’t. Wealth defines rich, not income. Your income could be three million dollars a year but if you’ve spent lavishly and are in hock up to your eyeballs, you’re not rich. On the other hand if you’ve inherited tens of millions of dollars and you work at a low paying job just because you like it, you’re still rich even if your income is meager. In other words, to be rich in the way every dictionary I’m aware of defines it, you must have wealth. Income is a separate matter and people may or may not be rich no matter what their income is. ---
**Author:** ![Fear\_Itself](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fear_itself/32/19637_2.png) [@Fear\_Itself](https://boards.straightdope.com/u/Fear_Itself)\ **Post date:** [March 20, 2013, 10:11am UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/516 "2013-03-20T10:11:57Z")
> [@Starving\_Artist](#): > > Your income could be three million dollars a year but if you’ve spent lavishly and are in hock up to your eyeballs, you’re not rich. Anyone who makes and spends three million dollars is rich. ---
**Author:** ![SciFiSam](https://avatars.discourse-cdn.com/v4/letter/s/47e85d/32.png) [@SciFiSam](https://boards.straightdope.com/u/SciFiSam)\ **Post date:** [March 20, 2013, 10:52am UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/517 "2013-03-20T10:52:42Z")
What dictionary defines rich as only pertaining to retained wealth? I’m certain that’s not how most people use the word. I mean, this thread is evidence of that. ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [March 20, 2013, 4:05pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/518 "2013-03-20T16:05:44Z")
> [@SciFiSam](#): > > What dictionary defines rich as only pertaining to retained wealth? I’m certain that’s not how most people use the word. I mean, this thread is evidence of that. Most people (and dictionaries) consider “rich” and “wealthy” to be synonymous. Yes, you can try to make a tortured distinction, but that’s not a common-use one. ---
**Author:** ![Fear\_Itself](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fear_itself/32/19637_2.png) [@Fear\_Itself](https://boards.straightdope.com/u/Fear_Itself)\ **Post date:** [March 20, 2013, 4:33pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/519 "2013-03-20T16:33:51Z")
> [@Terr](#): > > Most people (and dictionaries) consider “rich” and “wealthy” to be synonymous. Yes, you can try to make a tortured distinction, but that’s not a common-use one. I think you are mistaken. Most people see people with a high income as rich, while those with a high personal value as wealthy. A rich person who spends all his yearly income is no less rich; he still has all the assets or the benefits of the services he purchased. A wealthy person has a high personal value that grows year over year. ---
**Author:** ![Terr](https://avatars.discourse-cdn.com/v4/letter/t/839c29/32.png) [@Terr](https://boards.straightdope.com/u/Terr)\ **Post date:** [March 20, 2013, 4:41pm UTC](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110/520 "2013-03-20T16:41:30Z")
> [@Fear\_Itself](#): > > I think you are mistaken. Most people see people with a high income as rich, while those with a high personal value as wealthy. A rich person who spends all his yearly income is no less rich; he still has all the assets or the benefits of the services he purchased. A wealthy person has a high personal value that grows year over year. Dictionary disagrees: [http://dictionary.reference.com/browse/rich?s=t](http://dictionary.reference.com/browse/rich?s=t) rich: having wealth or great possessions; abundantly supplied with resources, means, or funds; wealthy: a rich man; a rich nation. [http://dictionary.reference.com/browse/wealthy?s=t](http://dictionary.reference.com/browse/wealthy?s=t) wealthy: having great wealth; rich; affluent: a wealthy person; a wealthy nation. But do an experiment - ask a random person (or a few of them) whether “rich” and “wealthy” are the same thing. [Previous page](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110.md?page=25) [Next page](https://boards.straightdope.com/t/200k-year-isnt-rich-why-arent-we-taxing-corporations/596110.md?page=27)