A Quarter Million Dollars per Year = Rich

Driving me crazy on Morning Joe again today, as host and former Republican congressman Joe Scarborough keeps talking about how the cutoff of $250,000 for defining high income people whose taxes should go up is too low.  "What about the small businessman making just $270,000 a year, struggling to make a payroll?" etc.

My wife accused me of talking to someone- I was just talking back to the TV.  Here's why:

• First of all, we're talking about marginal tax rates.  That means that everyone gets taxed the same on that first $250K.  So the small businessman making $270K is only taxed at the higher rate on the last $20,000 of income.  It's not a huge tax increase on people at the lower part of the high income spectrum.
• As cohost Mika Brzezinski pointed out, "how have those lower tax rates on so-called job creators worked out over the past 10 years?"  The answer, of course, is that they haven't worked out at all, and there's no evidence at all that raising rates on this group will hurt investment at all.
• It seems like a great life being a political pundit on TV.  My guess is that everyone around that table makes at least $250,000 a year.  That's great for them, and I don't begrudge them their money, but I think it does make their view of money a bit skewed.  At $250K an earner is in the top 3% of Americans.  Even in New York City, the median household income is $55,000, so if you're making $250 you're making more than four times the median household income.  I know everyone in American wants to see themselves as hardscrabble middle class, but at that income level you're rich.  No matter where you live.
• I'm not even sniffing at $250,000 in income per year, and my life is pretty damn comfortable.  I go on vacations out of state, I send my kids to overnight camp, I go out to dinner whenever I want, etc.  You just can't tell me $250 isn't a lot of money to earn in a year.

UPDATE: Here's Matt Yglesias making the point specifically in New York City.