Not Shedding Any Tears for HENRY

So I was reading an article in Fortune today and I found myself getting really irritated with whiny rich people. The editor was lamenting the Obama tax plan and how it impacts HENRYs, "High Earners Not Rich Yet" and used the following illustration:

Say a family earns $300,000 a year, and pays $50,000 a year in mortgage interest; the family also contributes $5,000 to Boy Scouts, Red Cross and other charities. Under the AMT's top effective tax rate of 35%, they benefit from savings of $19,250 on those deductions. But under Obama's new plan, the share of that $55,000 that HENRYs can deduct is no longer 35%. It's capped at 28%. Hence, their tax bill rises by almost $4,000.

Oh heavens! Where on earth will these people who make 1/3 of a million days per year and have a McMansion big enough that it's generating $50k a year in interest (and who donate a paltry 1.6% of income to charity) ever come up with an extra $4k to pay in taxes?

This article laments the plight of these poor individuals whose

chance of accumulating the couple of million dollars needed to qualify as rich were virtually nil even before Obama took the stage.

Chance of accumulating a couple million dollars was virtually nil? Are you kidding me?

Let's see. According to one website, the average American's income is roughly $42,000. Assuming that is a family, they would be in the 15% tax bracket so in their after tax income is $36,500. Now, if Henry is making $300,000 per year he would be in the 33% marginal tax bracket and his after tax income would be about $222,300.

If Henry lives at the same standard of living as the average American (as a shortcut, I'll use $36,500 in annual expenses) he would be able to save $185,800 a year. Even if he just puts it into a CD earning 2.5% interest a year, at the end of 5 years he would have $998,675 and thus would basically be a millionaire. His chances of accumulating a couple million dollars are "virtually nil" only if he lives an extravagantly opulent lifestyle well above the average American, who is already grossly rich by most of the world's standard.

Tall about being out of touch with the worries and concerns of the average American.

Automotive Parts and Accessories

After helping someone at church replace their flat tire with a spare a couple weeks ago, I started thinking about preparations for roadside emergencies. I went to Wal-Mart and noticed a couple products of interest. Has anyone ever tried the Slime Smart Spare

or the Schumacher 6-4-2 amp charger


or any similar products they would recommend?

Face It

So recently, with Jake and Rita's persuasion I finally broke down and joined Facebook. It has been cool connecting with people I haven't seen in ages.

Will you be my friend?

In Dreams I Walk With You

So I had this other crazy dream last night which also makes me think maybe I've been working too much. It started because I was having a discussion with a co-worker, Matt, about how much space in the bathrooms is devoted to toilets and I felt there should be more room for cots to sleep on. My old college dormmate, Ty was there. Afterwards, I ended up at my parents house in Ohio where my friend from Delaware, Mei-ling, was dogsitting for my parents. In addition to the dog that my parents actually have, there was a husky and some other breed. She was surprised to see me there. Then, after walking up some steps with my pastor Karl and friend Noel, I somehow was at this summer camp with some other co-workers. Susan was mad because Frank ate her food, and someone wanted me to intervene which I reluctantly did but Frank was unrepentant. Then, in the basement, my friends Jake and Rita were there laying on cots, but the A/C was out so everyone was in their swimsuits and sweating profusely. I ended up again in the bathrooms and woke up.

So, as I was discussing with some friends from church today, do all dreams have meanings? How do dream experts derive consistent meanings in the interpretations of dreams? How can you tell if your dream is expressive of deeper internal concerns or if it's just a random conglomeration of people and events?

Workaholism?

I think I may have been working too much lately. When I got home tonight after dessert with some friends, I tried to unlock my door with my office keycard.

Dental Dreams

So the other night I dreamed that I had three rows of teeth, sort of like in the movie Coneheads only not quite that bad.

Is my subconscious telling me I need to do a better job flossing?

Weird. Very weird.

Interesting Song

I'm also intrigued by The Fray's new song, Where Were You? It brings to mind lines from Lewis's A Grief Observed.

New Tunes

I'm digging the first track from The Airborne Toxic Event. Little bit of an Arcade Fire kind of vibe.




"and the piano's this melancholy soundtrack to her smile"

Mint

The last few weeks I have been checking out an on-line personal finance website (similar to Quicken or MS Money software only web based) called Mint. I thought they had a pretty good synopsis of things in their article, Three Principles of Personal Finance: All You Need to Know for Financial Success:

1. Spend less than you earn
2. Make the money you have work for you
3. Be prepared for the unexpected

Like physical fitness, vital to financial health is "strengthening the core" and following these simple and intuitive principles.

Creighton, if you're reading this I'd be interested in hearing your thoughts on the article.

Is It True?

As I haven't been able to sleep again tonight, I continued reading The Pilgrim's Regress. I came across this statement:

Do you know how it is with love? First comes delight: then pain: then fruit. And then there is joy of the fruit, but that is different again from the first delight. And mortal lovers must not try to remain at the first step: for lasting passion is the dream of a harlot and from it we wake in despair. You must not try to keep the raptures: they have done their work. Manna kept, is worms.

Think he's right?

Obama Gets It Right on Trade

I was encouraged to see President Obama offering some correction to Congress on their attempts to insert protectionist language into the stimulus bill. According to CNN,

President Barack Obama "wants to ensure that any legislation that passes is consistent with trade agreements and doesn't signal a change in our overall stance on trade," White House Press Secretary Robert Gibbs said in a briefing Wednesday.

That is marvelous. While I am all for buying American goods out of my personal wallet, writing it into legislature in a huge federal spending bill would only incite a round of international protectionism which would further cripple the global economy as it did during the Great Depression. American companies must be effective and efficient and compete on their own merits against their international counterparts, just as we insist these international firms must do so in their own borders.

Thank you Mr. President.

Stimulating Bad Behavior

Yesterday I saw an article that part of the stimulus package being crafted by Senate Democrats included "above the line” tax deductions for interest payments on car loans and state sales/excise taxes for new cars purchased between November 12, 2008 and December 31, 2009."

Okay, so let me get this straight. Part of the reason we are in a financial crisis is because consumers overstretched themselves with debt. And part of the solution is to provide an incentive for consumers to borrow more money to buy a new car?

This is completely unfair. In essence, I, who have been frugally saving for my next car as I hope to drive my Saturn for another 90,000 miles or so am providing a tax subsidy for someone to go out and borrow money to buy a new Lexus.

This is a bad idea. I'm all for a stimulus package that focuses on improving our failing national infrastructure and creating energy independence, but leave it to Congress to totally screw up this opportunity.