Meet the CEO Who Cut Worker Pay in Half While Pulling in $21 Million Last Year

[haele]

44. Actually, wages from $25 to $40 an hour do trickle down to the economy at a high rate.

People working at that level tend to spend most of their money in their local economy - at grocery stores, family restaurants, mechanics, dentists, pharmacies, veteranarians... They also still tip at a decent rate to their wait-staff. They tend to pay almost all tax levies they are required to pay (especially in sales taxes) and they usually don't have enough deductible expenses to take advantage of the larger corporate loopholes at the state or federal level that might actually give them subsidies.
This level of wage is the money that creates jobs, supports community services through the taxes and local spending, and ultimately is the greatest driver in raising both community standards and wages at the lower levels of income.

It isn't until around $55/60 an hour that some of that money really starts to go into investments outside the local economy - that's at the $110 - $130K gross salary level. But even then, you'll probably be seeing more of the luxury services in the economy - private accounting or legal services, contractors, high-end restaurants and entertainment venues getting part of those wages.

At around $250K salary, probably a third to a half the income that person is making is sheltered somehow from taxes - if they're smart with their finances and not living large or using a small business as a personal ATM. The loopholes they can use are also a lot larger, and I do know of some people even at that level who are able to leverage those loopholes and sheltering vehicles to actually receive more money back than they paid in taxes over the year.

The only people who aren't able to see a significant savings at the $250K - $500K income level are those who don't invest, or disabled/chronically ill people who are carrying their own health and living support costs (health care deductions suck!), or are supporting several adult dependents who aren't working and can't be deducted. Another failure to save at that level is found in those who are running a "family business", i.e., leveraging family/home resources or paying employees under the table to "save on costs short term" - and they aren't able to realize all their deductible business costs - primarily because they aren't separating their personal income from business revenue, for whatever reason.
Usually this is because they don't want to admit how little they are honestly making from their business if they ran it as a business instead of admitting that at that level, it is really a hobby business - or they're running their business as the family ATM, buying toys like RVs, boats, and vacation homes on "excess profit" during good quarters that they should be plowing back into the business - or into savings or capital income vehicles to take care of retirement for everyone involved after they get too old to run their business.

Detroit, Chicago, Cleveland - these were thriving cities with a sustainable lower working/service class when there was a majority middle working and professional class living, working, and spending in the city. When the wage gap was more equally divided, and a high-school diploma or associates degree/trade school certificate could get someone on their way to a comfortable life and a chance to retire in dignity.
When the working middle class fell into just the "working class", and the gap between the wealthier and the poorer levels of income became greater, and those with the money left to get away from those "nasty, dirty, ignorant poor people", these cities just started to crumble.

People who try and pit the middle working class against the poor by complaining about wage differences are ultimately apologists for the business or financial "tycoons" who want to keep living like kings, hording their money in offshore accounts instead of paying their fair share to maintain the thriving infrastructure that contributed to - and keeps contributing to, despite their misguided efforts - their great wealth.

The poor don't deserve to be poor and certainly need help to get to a place they don't need assistance and have access to an income that allows them a decent standard of health and living.
But those who still have jobs that pay close to the compensation they deserve due to the work they are providing and are paying their fair share of taxes to maintain the community infrastructure are not the ones causing the suffering and low wages and are certainly not the ones who should be "punished" or scorned because they're not the greedy fools and/or bigots who have taken away the living wage jobs and ability to maintain the local community.

Haele