Monday, November 12, 2012

God bless the child that can pay his own way.

Mitt Romney, May 17, 2012: 
“There are 47 percent of the people who will vote for the president no matter what. All right, there are 47 percent who are with him, who are dependent upon government, who believe that they are victims, who believe that government has a responsibility to care for them, who believe that they are entitled to health care, to food, to housing, to you name it. That that's an entitlement. And the government should give it to them. And they will vote for this president no matter what. And I mean, the president starts off with 48, 49, 48—he starts off with a huge number. These are people who pay no income tax. Forty-seven percent of Americans pay no income tax. So our message of low taxes doesn't connect. And he'll be out there talking about tax cuts for the rich. I mean that's what they sell every four years. And so my job is not to worry about those people—I'll never convince them that they should take personal responsibility and care for their lives.”

Bill O'Reilly, November 6, 2012: 
“It’s a changing country, the demographics are changing. It’s not a traditional America anymore, and there are 50 percent of the voting public who want stuff. They want things. And who is going to give them things? President Obama.”

What I found most shocking about these two quotes... and most similar... is the lack of any sort of acknowledgment that people might actually deserve “stuff”. Might actually be “entitled.”

Is it possible that, if you work 60 hours a week, moving constantly, doing the things that other people don't want to do for themselves, stuff that requires lifting belts and work gloves, where you don't get paid vacations or sick days, that you have earned health care, food, and housing? Is that enough for Mitt Romney? Is it enough for Bill O'Reilly?

Here in California, the minimum wage is $8.00/hour. Plenty of really grueling jobs pay that wage. I'm not an accountant, and don't even do my own taxes... but I'll keep things simple. Here's the math for a family of four with one full-time, one part-time job at minimum wage:

60 hours per week x 52 weeks per year x $8.00/hour: $24,960 gross pay possible

...but let's say four days per year, on average, they're too sick to work. Because they're “contractors” instead of full-fledged employees, they don't get paid sick time (it's rampant all over the place... my mother-in-law has been a tech writer “on contract” for the last 13 years). So take off...

8 hours x 4 days x $8.00/hour: $256 so the gross is now $24,704. This assumes no vacation, no taking a morning off to go see their kid's holiday pageant at school, nothing.

But, these are still wages, so in spite of no paid vacation or sick time, they still pay payroll taxes. They're kind of complicated; there's several different ones. At least the $110,000 wage cap for social security deductions doesn't come into play. Here's what your hypothetical family will be paying:

FICA + Medicare: 7.65% of gross pay $24,704 = $1,889.86
Federal Unemployment Insurance: 0.9%* of the first $7,000 = $63
State Disability Insurance: 1.0% of gross pay $24,704 = $247.04
State Unemployment Insurance: 1.5% to 6.2% depending on employer's record; using average 3.85% of first $7,000 = $269.50
There's also an Employment and Training Tax, but it maxes out at $7 and isn't paid by all employers, so I'll just ignore it for now.

* Usually FUI is 0.6%, but California is paying its bills late, so we have to pay more into the Federal system.

The grand total of all wage taxes paid in a year by this family is now $2,469.40. But they haven't paid income taxes yet, so they're still in that 47%.

What do they have left at this point? $22,234.60 per year, for a family of four.

So do they pay income taxes? Well, let's take a look at the standard deductions, and the Child Tax Credit:

This family, assuming they're married, middle-aged, and not blind, qualifies for a standard deduction of $11,600, though there's the whole part about deducting the children and the tax credit. Some sources say such a family gets a total of $15,200 in deductions, which makes their taxable income $7,034.60.

According to the IRS tables for 2011, this family will owe $703 in Federal income taxes. However, since they have two children and make less than $110,000/year, they can claim $2,000 in child tax credits. These are now the tax-free folks who actually get money back from the government after a negative Federal tax bill. They can receive a credit of $1,297, to add to the $22,234.60 they take home.

We haven't even looked at what that $23,531.60 will pay for. This family has no health insurance, no 401(k) or IRA, and has to buy housing, food, transportation, clothing, and utilities. (But we're upset that they might get an Obamaphone.)

Why aren't they working more hours, though? Surely if they worked 80 hours a week, they'd be taxpaying citizens?

A family with two parents who work a total of 60 hours a week can get by without paying for childcare. Once you have two parents working full-time, though, you have to pay someone to care for the kids when they're not in school (if they're not under five and still not eligible for free education... another thing we don't think these people deserve). At minimum wage, the math just doesn't work out. Some families can rely on a grandparent or other relative for childcare, but if this person is not working, the wage-earning family likely is still somewhat responsible for the caregiver's expenses.

But let's say that their local school happens to offer some sort of free after school program, so they can both work 40 hours a week. Or one works 30 and the other works two jobs... somehow they get to 80 hours. They are still not paying taxes. With two children, you need a taxable income of $19,000 or more to exceed the tax credit, and the 80-hour a week minimum wage four-person family is at $14,634.92. Even if they get bumped up to $9/hour and 80 hours/week, they're in the 47%.

All they had to do was back-breaking, often humiliating, sometimes dangerous work, cleaning up after other people, 80 hours a week. And they think that this entitles them to health care, food, and housing? They think that they should have stuff?

In the Republican world, poverty is not just a moral failing. Your economic standing is a measure of your worth as a human being. If you do not already have something, that is sufficient to determine that you are not deserving of that thing. 

Them that's got shall get, them that's not shall lose. So the Bible says, and it still is news.”

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