The 1 Percent: $344k & Up
DENVER (CBS4) – “We are the 99 percent!” That’s the chant heard over and over as Occupy Denver demonstrators have cried out to have their voices heard.
They are angry about money in politics. Many are angry about tax rates for America’s wealthiest people. It’s an America that has become more divided between rich and poor in recent years.
The top 1 percent of America’s wage earners now take in nearly a fourth of the nation’s income each year. That’s about twice what it was 25 years ago.
In terms of sheer wealth, the richest 1 percent control about 40 percent of the nation’s wealth. At the same time, America’s middle class has a smaller share. This is the core, or the near-core of the arguments made by protestors in Denver and around the country.
The latest IRS figures from 2009 show the adjusted gross incomes of the top 1 percent are at about $344,000 and above. While there are people with the wealth of Bill Gates and Warren Buffett, there are people included in the 1 percent who are just above that $344,000 level.
Upset with the protestors, a man who identified himself as a judge in Texas said, “If you’re the protestors in the park, it’s anybody but me.” He said his household income is “significantly above” the $344,000 level, but he doesn’t feel rich.
“If you’re struggling to make your mortgage payment, then you’re not rich.”
Daniel Stewart, who lives in New York City, told CBS “I also watch as my taxes get drained out of my check, that I have to also live basically check to check making a couple $100,000 a year.”
The relative wealth of that figure does vary according to region. Three sisters visiting Denver had different yardsticks.
One lived in the Carolinas.
Is $344,000 rich there?
“In South Carolina they are, yeah.” She makes $32,000 a year.
Her sister who lives in the San Francisco Bay area told CBS4 $344,000 makes you not rich, but “good middle.”
University of Colorado professor of Economics Jeffrey Zax noted, “There’s probably about a million and a half households that are in the top 1 percent.
“And so naturally Warren Buffett is there, Bill Gates is there, Michael Jordan is there, Tiger Woods is there, but there are lots of other people in there as well, most of whom you wouldn’t know or recognize when you walk past them on the street.”
There is a concentration of wealthy in the financial industry, according to a Congressional Budget Office study.
“Twelve, 13 percent of them are in the finance industry,” said Zax.
“Another 30 odd percent are executives in businesses of various sorts. Perhaps 15 percent are in the medical profession, another 10 or so percent are lawyers. So they come from a variety of various sources.”
And they have a variety of views.
CBS4 talked with software developer Glenn Tubb.
“I feel like I’m sort of a blue collar working executive. That I work for my money, I work hard. And I did a lot of education and I took a lot of risk.”
Tubb is above that magic $344,000 level some years, and others he’s below.
“I get a certain lifestyle with kids in school, in college, you know, they go to expensive universities. You know, you have a house, you get a mortgage you get a certain lifestyle. But no, I don’t feel rich.”
As for the compensation, “I think you are paid for your performance,” said Tubb.
“Some of the quote unquote fat cats on Wall Street, they’re making a lot more money than I do and whether or not they deserve it or not, I can’t rule.”
Tubb calls himself a capitalist with a social conscience. He believes the Bush-era tax cuts should be repealed.
“We have a long time of pain coming and it’s never going to get resolved by just cutting spending.”
That would mean higher taxes for him.
“I believe that the American wealthy are underpaying right now.”
Zax talks about how that line between 1 percent and below moves.
“It has gone up and it has come back down again. It’s lower now than it was a couple of years ago.”
That’s because in 2009 the stock market didn’t provide the capital gains it has in more heady recent years.
The markets grew solidly last week, then fell early this week. … The rise and fall of huge incomes breathing right along with them.