Tuesday, October 30, 2012

Mad Men and Tax Policy

Just happened to be watching Episode 27 of Mad Men.  In it, Crane questions the point of earning over $40,000, since everything over that amount is taxed at 69%.  And he says its gets even worse -- everything over $70,000 is taxed at 81%.  There's an interruption when Kinsey asks if it's the same if you're married, but I'm pretty sure the answer would have been yes.

Still, from watching the show, I get the distinct feeling that they'd all like to keep earning more and more money.  I don't think they'd mind paying that 69% bite, if the reason they were paying it was because they were making a lofty $40K/year.

$40K in 1962 dollars is about $306K today, per the CPI inflation adjustment calculator (of course, you couldn't buy an iphone back then).

$70K would be about $536K.

How far we've come.  Now we're squabbling about a proposal to increase the tax rate from 33% to 36% for people earning over $250,000 ($32.6K in Mad Men dollars).  There is simply no rational argument for NOT allowing those taxes to go up, if it eases the burden on the genuine middle class.

And of course, the really rich people living off of millions of dollars a year in passive income -- like Mitt Romney -- manage to pay less than 15%.


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