The press has been giving the top one percent of wage earners a closer look. According to one New York Times article, they are a complex group that is hard to define. They do not vote en masse. They do not all go to the same church or school. Some own their own businesses, but it is clear they cross professions. Some have inherited money, but plenty have made it all on their own. They give a larger percentage of their earnings to charity (because they can) than lower income earners.
Depending on location, the earnings to get into the group vary widely from under $200,000 to more than $500,000. And that’s just to get in the club! The top wage earners in this group surpass millions.
As I was reading the article, I thought how at each rung of the financial ladder, the ones hanging on to it by their fingernails always seem to be the most quiet. They are too busy hanging on to speak up, or they feel unsure of their footing. Even in the top one percent, they keep their heads down, working through the economic downturn waiting to see what will happen next. Will their taxes go up? For physicians, will reimbursements go down? Will tuition go up again next year?
These are the wealthy who are just wealthy enough to benefit from the ability to make choices. Granted, the choices are often between two or more great things. For those making less than $500,000, they get to choose between private school for their kids or moving to bigger house where the public schools are better. They get to choose between a new car and a two-week summer vacation. They get to choose between hiring a housekeeper and joining a gym. You certainly do not feel sorry for them. And they are not really the types to look for our sympathy.
But they still have to make choices. They have to be careful and responsible in how they spend and save, just like those on the salary rungs below them. It is easier, of course, but they are still striving.
And when we increase taxes on them, or lower reimbursements for doctors, or require more from them, we minimize their ability to make choices. And isn’t that what they worked their whole lives for? Isn’t that what made them the country’s current crop of the best and brightest? The ability to make the choices that will keep them feeling fulfilled and happy. Isn’t that what we all want?
And if people working 60-80 hours a week, after investing in years of post-graduate work and training, lose their ability to choose how they spend their money, what do the rest of us have to strive for? Those wage earners bringing home $200,000 were the ones within reach (or almost), right? If “wealth” is completely out of reach, what are we working to achieve? To just get by?
Is that the way to inspire a nation? Is that how we encourage our brightest young people to meet the global competition? Is that how we teach our kids to be the best they can be?
If we make it harder and harder for the lowest rungs of the one percent to make the choice between public and private school, a beach vacation or a new car, then what we are striving for becomes an income out of everyone’s reach.
Warren Buffett, who claims the wealthy should be required to give more in taxes, would be part of the tiniest group of people able to send his grandchildren to college without a full ride. He would be driving around his private jet while the next wealthiest group couldn’t afford a new car or a high-caliber education. So when Warren Buffet says the one percent should give more in taxes, just know if we do, he will be very lonely at the top with no one nipping at his heels.
And if being bright, working hard and investing in your education don’t get the average man or woman closer to that one percent, where choosing between two good things is possible, will they continue to work the hours, commit to fields that provide a service, donate to charity, keep their heads in their books?
There is something wrong with an economy where the gap between the wealthy and poor continues to grow. But the answer is not kicking you down as soon as you reach the goal of economic success. The poor and middle class and upper-middle class will be watching, and eventually accept that they have no chance.