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Friday, December 23, 2011

Who is rich? Who is poor?

These are not simple questions

By Will Collette


There has been a lot of banter on this blog lately about the rich and the poor. How are they defined? Do they deserve what they get (or what they’ve got)? Do we foment class war by discussing these subjects? Should we hate the rich (or the poor) and, if so, why?

These weighty and complicated subjects have been addressed in micro-bursts of words in our comments section – about what you might expect in a blog. Or on the internet.

But let’s first acknowledge that these subjects do have relevance to Charlestown. It certainly exploded out into the open on December 12 when the Town Council majority – to the applause of a mob of Charlestown’s upscale property owners – killed a $1000 Homestead Tax Credit proposed by Town Democrats.

That $1000 tax cut would have saved hundreds of dollars for the 2000+ Charlestown households living in homes valued at under $500,000 while it would have raised taxes on houses assessed between $1 million and $6 million by between $1000 and $6000.

In the banter about wealth and poverty, I didn’t hear these questions: Do Charlestown residents in homes assessed at less than $500,000 need a tax break? Should Charlestown property owners with houses worth more than $1 million pay extra to give it to them?

This is a micro-version of an age-old debate over what obligation those with wealth and means owe to those less fortunate.

Republicans in the House of Representatives would argue there is no obligation. Ron Paul would argue there is no obligation, as would all of the others in the Republican Presidential hunt. Ayn Rand would argue there is no obligation, although she signed up for Social Security and Medicare as soon as she qualified. The Tea Party would argue there is no obligation.

Council members Tom Gentz, Dan Slattery and Lisa DiBello would argue there is no obligation. RISC President Harry Staley would argue there is no obligation.

In the recent comments, I kept hearing the demand for a definition of “rich.” I could play cute and say that recognizing “rich” is like recognizing “art” or “pornography” – we know it when we see it.

But to be more precise, we have recent census data to help us. According to the US Census, that “1%” made famous by the Occupy Movement are comprised of 1,380,000 Americans with incomes above $343,977 a year. Some might argue that income level is too low to really be rich (I wouldn’t, but some would).

I think most can agree the 138,000 Americans who earn more than $2 million a year and comprise 0.1% of the population are rich. Then there’s the indisputable rich, the 5309 Americans (0.004%) with annual incomes above $10 million a year.

At least one commenter said he heard the number $100,000 used as the definition of rich. 8.3% of Americans earn $100,000 or more. That may have come up in the context of the Social Security debate where a wage earner stops paying Social Security tax on wages above $106,800 mark ($110,100 in 2012). We could eliminate the threats to Social Security’s solvency simply by abolishing the cap.

In the Charlestown Democrats’ proposed $1000 Homestead Tax Credit, the tax benefits would peter off for residents with homes assessed at between $950,000 and $1 million. I think it is reasonable to say that a household that can afford and maintain a million-dollar house is pretty rich compared to the rest of us. And certainly at $2.75 million or even $6 million, it is hard to argue that there is some real wealth here.

Let’s look at the other end. The 2011 poverty standard for a family of four in the lower 48 states is $22,350 a year.

Last week, some controversial new census data was reported by the Associated Press that showed 49.1 million Americans living below the official poverty line and another 97.3 million as “low-income” (roughly 200% of the poverty line). That tallies to just under 50% of the entire population of the United States.

In Charlestown, we only have one “means-tested” tax credit program and that is for low-income senior citizens. The threshold to qualify is an annual income of $30,000. It may surprise you to learn that this is nearly triple the federal poverty line for one person ($10,890).

So is it “class war” to address these subjects in Progressive Charlestown or anywhere else? Class conflict is as old as humankind. Along with religion, major income gaps are a top cause for wars, especially civil wars. At the risk of offending Charlestown’s elite, I assert again they are the ones who have waged class war on working families in Charlestown and to borrow a bumper sticker slogan, “they only call it class war when we fight back.”

But no matter what we call it, there is a real struggle taking place in Charlestown as it is everywhere over the allocation of resources, over community priorities and over tax policies. It didn’t begin on December 12. Or a year ago. Or ten years ago. And it’s not going to end soon.

The owners of high-end Charlestown properties made it crystal clear on December 12 that they will fight to keep from having their taxes raised. They may even fight to get them lowered because they certainly made their scorn for public schools and town services, such as they are, very plain.

There was a recent study by the University of California Berkeley that holds that the richer you are, the less compassionate you are, Bill Gates and Warren Buffet notwithstanding. The researchers also noted that empathy and compassion tended to grow at lower income levels. During the December 12 Council meeting, the threat was actually voiced that if Charlestown imposed a higher tax on non-residents and high-priced properties, the wealthy owners might stop donating money to Charlestown causes. This threat seems to give credence to the study’s findings.

Finally, there’s this question about hate. Do those of us who raise these issues hate the rich? Should we hate the rich? Do I hate the rich?

It’s an odd question, but it seems so typically Charlestown where our devotion to "civility" is such that any critique of anything or anybody is treated as if it was an obscenity spray-painted on Town Hall. The purpose of Progressive Charlestown is to bring genuine issues – including this town’s long-standing conflicts – out of the closet and into the public arena.

There must be a way that issues can be addressed that is different than the two usual extremes we see in town – the repressed rage and quiet back-biting and snipping and sniping on one extreme or the out-of-control, red-in-the-face displays (e.g., Mageau tirades or December 12’s riot of the rich) on the other extreme.

That’s the idea behind Progressive Charlestown. Since we’ve started, we have raised the issues, put them before you, presented the evidence and documentation, named the names of who stood on each side, and identified who had the most to gain. We have also expressed opinions, sometimes strongly, but always what we really believed – and what we could back up. From time to time, that may jar the normal sensibilities of Charlestown society.

But I love this town and it is my home. I want it to be the best place it can be. I love the people of Charlestown, most of them anyway. But I would rather be respected for being honest than loved.