Though vowing not to raise taxes on the middle class, President Obama was re-elected on a platform that would hike the rates of America's top two tax brackets 3 per cent and 4.9 per cent on January 1 — that is, for households whose annual income exceeds $241,900 (£152,250). Thus he drew a sharp line between where "middle class" leaves off and "wealthy" begins-and with the latter designation, in this administration you lose all sympathy.
I have old friends, a couple living in the greater DC area whose earnings are now nudging up against the cut-off beyond which we are no longer supposed to feel sorry for them. Their fiscal particulars make for an illuminating case study. Respectful of their privacy, I'll call them Fred and Ginger — both aged 56, with combined wages of $236,000.
Whoa! That's a lot of money! Yeah, sure, lop off nearly half — $95,600 — for federal, state, local, Social Security, Medicare, and property taxes. Still, that leaves a healthy $140,000. So how could my friends be so deeply in debt? What's their problem? A foolhardy fondness for Ferraris?
Their problem, in a word, is education-which Obama champions as the salvation of the American future. Wary of their district's dodgy public schools, Fred and Ginger spent $180,000 on private secondary education for their two daughters, both exceptionally bright. Determined to provide the best leg up in a world where employment will grow only more competitive, they've sent both girls to top-flight private colleges-which cost, with room and board, $55,000 a year. Once the younger daughter graduates in 2015, my friends will have spent $440,000 on their kids' Ivy League degrees, bringing the total education bill to $620,000.