According to a recent Siena College public opinion poll, seventy-two percent of New Yorkers favor higher taxes on millionaires, including a majority of Democratic, Republican, and independent voters. Despite this, Governor Cuomo and Republicans in the State Legislature oppose extending an income tax surcharge on individuals earning more than $200,000 or households with incomes above $250,000. Cuomo says he supports a federal millionaire's tax but does not want to put New York State at a competitive disadvantage, probably fearing the wealthiest New Yorkers would rebel and move to North Dakota, Idaho, and maybe Wyoming, to avoid paying their fair share.
In a recent op-ed article in the New York Times, billionaire financier Warren Buffet, the second richest person in the United States after Bill Gates, called for higher taxes on the mega-wealthy. Buffet pointed out that for 2010, because of a multitude of tax breaks and credits, his federal income tax rate was only 17%, far less than the rate paid by his secretary and most working Americans -- the 99%. Buffet and I agree that this is outrageous.
While I am not a millionaire and I don't even qualify for the current New York State surcharge on higher income earners, I should be paying more taxes too. Maybe that would clean up some of the economic problems plaguing New York City and State and the United States and leave enough money to support senior citizens, provide medical care, and hire teachers.
I think the biggest unfairness is the payroll tax for Social Security, which taxes the poor and working people at a much higher rate than professionals like me and the wealthy. I just received a take-home pay increase for the rest of the year because I passed the threshold for paying into the fund. Few people realize, because they don't make enough money to make a difference, that you only pay FICA or the Social Security tax of 4.2% on the first $106,800 of your earnings. If you make $110,000, the last $3,200 goes untaxed so you get to keep an extra $134.40. If you earn one million dollars, you avoid the 4.2% payroll tax on ninety percent of your income so you save $37,800 in taxes, which is more than half of what the average family of four in the United States earns a year.
There is a lot of concern that the Social Security fund is headed for bankruptcy, maybe by 2037, and that future generations will be left without benefits. Payouts may exceed income by as early as 2016. But the system does not have to collapse if people who earn more paid their fair share.
New York Yankees third baseman Alex Rodriguez was paid 27.5 million dollars by the Yankees in 2011 and the Yankees got knocked out of the play-offs. A-Rod paid $4,485.60 in Social Security taxes when he should have paid over a million dollars. President Obama made 1.7 million dollars in 2010. He paid the same $4,485.60 as me and A-Rod in Social Security taxes when he should have paid $71,400.
New York City Mayor Michael Bloomberg is one of the wealthiest men in the world, Forbes magazine ranks him at number 12 in the United States with a net worth of over nineteen billion dollars. But the Wall Street Journal reported he paid only $500,000 in federal income taxes in 2010.
At the same time Bloomberg is laying off school cafeteria workers in New York City schools, he is actively campaigning against proposed federal tax increases that would help pay for their jobs.
I think Mike Bloomberg needs to pay more in taxes too.