$1 million = about $20,000 per week
Michael Peppard December 20, 2012 - 7:40pm
It's been difficult to follow all the "fiscal cliff" negotiations, not least because no one besides President Obama and Speaker Boehner really knows what's on the table. If you're just catching up with the various offers and counter-offers, you might find this chart by Dylan Matthews helpful, as I did:[caption id="attachment_22421" align="aligncenter" width="573"] Dylan Matthews, Wonkblog, Washington Post[/caption]The GOP's latest offer, which Boehner is calling "Plan B," focuses on the income threshold of $1,000,000 per year. But in discussions about this income threshold, I note that the misleading term "millionaires" often gets used: a recent Wall Street Journal headine said "GOP Poses Millionaire Tax-Rate Increase." And that's not just shorthand for the purpose of the article's title -- the lede reads:
A fresh proposal from House Speaker John Boehner to raise tax rates on millionaires marked a breakthrough in stalled budget negotiations with President Barack Obama, suggesting a potential framework for avoiding year-end spending cuts and tax increases known as the fiscal cliff.
"Millionaire" is very misleading when used in this way because the word usually refers to wealth or net worth, not annual income. The fact is, lots of people in our country are "millionaires," when the worth of their home, car(s), savings and retirement accounts, etc. are taken into account.But tax returns reporting over $1,000,000 annually are extremely rare -- about 0.1 percent of the returns. To put that level of income in a scale that makes more sense to the rest of the country, we might think of Boehner's plan to be about those who make, on average, more than $20,000 per week. Can you imagine making more than $20,000 per week? Or if each biweekly payday welcomed a direct deposit upwards of $40,000? I actually can't imagine it. But that's the kind of household our elected officials are discussing. Just to be clear.