Posts Tagged ‘rich’
Tuesday, January 1st, 2013
Posted by Leonard Steinberg in January 1st, 2013
I am blogging from sunny Cape Town, South Africa……my place of birth and still possibly the most beautiful place anywhere…….and while far removed from the concrete jungle of Manhattan, I have learned many lessons, or have been reminded of some from the past……so here goes:
1) Beauty sells: Cape Town features exceptionally beautiful natural beauty in its topography and vegetation……but there are areas that have been developed where this beauty has been badly damaged. In the areas where a strong consideration has been made to structural esthetic standards and landscaping, not only is the quality of life much better, but the real estate values area considerably higher. Tourists flock toward at the beautiful parts too. Beauty is worth lots! So let’s keep planting those trees in Manhattan and build beautiful, interesting buildings too. If profit is the only driving force in New York, so be it……as long the end end result is beautiful. It’s just smart.
2) Security: we area extremely spoiled in Manhattan with the safety levels…..the same is not true in Cape Town, where even in the best neighborhoods, panic buttons, electrified fences, guard dogs, and a whole host of other security devices and procedures are part of daily life. In a country where the divisions between rich and poor are extreme, let us not ignore the fact that in the USA this divide keeps growing and the masses are not happy. While crime exists everywhere, South Africa’s crime is especially violent and life threatening, even in a robbery. The primary source of the worst criminals are organized illegal immigrants, may from Nigeria. They are a horrible drain on South Africa’s people…..of all races.
3) Politicians are trouble: we have seen our US politicians mess put the fiscal cliff negotiations amongst other numerous cataclysmic blunders……in South Africa the same is true where pandering and maneuvering always trump what is best for the country. Politicians mainly hurt economies and development. They are simply not practical.
4)Mayors rule! The mayor of Cape Town, Helen Zille, has delivered a small miracle in Cape Town…..just like our Mayor Bloomberg she is focused on practical solutions for the city’s problems. She invests in that which boosts the local economy. Smart, sensible, tough, tough on crime, fast…..a lot the adjectives usually not associated with most politicians. Politicians as managers simply get it!
5) Views are universal value adders: Many homes boast gorgeous water, Mountain, city or garden views in Cape Town……those with the most breathtaking views in Clifton, Bantry Bay, the City Bowl, Bishopscourt and Constantia have exceptional views and always command a premium. A huge premium.
6) Car culture. I am staying at a gorgeous home overlooking all of Cape Town and Table Mountain up on Signal Hill. While close to everything, you simply have Everywhere everywhere for everything. The gym is 9 minutes drive. That’s 18 minutes per day……or almost 2 hours driving per week if you work out frequently……that’s over 100 hours driving per year to go to the gym…..or a 4 day vacation. My point is that while life in a big city has its negatives, not relying on a car for everything can be a huge time saver and makes life much more productive.
7) Trash: a favorite topic of mine….. It seems that everywhere I go, whether St. Tropes, London or Cape Town, all cities have better, smarter, more aesthetically pleasing ways of housing and collecting garbage. Hence my photo above that shows how trash is neatly contained in containers on wheels…..wheeled to the garbage truck , connected to a hoist and thrown in the back of the truck. Why on earth is Manhattan so backwards in this area? It’s disgraceful that we have streets lined with garbage bags. I feel this may become my call to action!
8) Authenticity: as I observe cities across the globe, the globalization and sameness of design keeps getting worse. Developers and city planners take note: things that are unique to a city make that city special and noteworthy. Elements, materials, and details that are unique to an area, define that area. I am not talking about re-creating history or Disney-fication……..just good, intelligent design…..and it can be very innovative design too.
9) LUXOFLATION is the tax on the rich: while some parts of the world have become very angry towards the rich, wanting to raise their taxes relentlessly……and in many instances some me of rich have been abusive of the system paying ridiculously low, disparate taxes ……know that the rich pay a price regardless of the taxes they are paying……in South Africa the luxury taxes and import taxes are HUGE….my car would cost almost double here. In other parts of the world, the rich pay more than double for their Hermes Kelly bags than they did just a few years ago……they all pay MUCH more for travel, homes, clothing, travel, etc. LUXOFLATION is the new tax on the rich and these extra dollars fuel sales tax, and corporate profits that filter down to everyone’s pension funds…..
Tuesday, November 27th, 2012
Posted by Leonard Steinberg on November 27th, 2012
Warren Buffet has said what we have been YELLING in a recent New York Times editorial: Income of $ 250,000/year is NOT rich. Not in New York, or Los Angeles, or Miami, or San Francisco, or a host of other larger US cities. His piece addresses brilliantly the hard facts about taxation and solutions that simply make sense to get us back on track:
- The FORBES 400, the wealthiest individuals in America, hit a new group record for wealth this year: $1.7 trillion, more than five times the $300 billion total in 1992.
- In 1992, the tax paid by the 400 highest incomes in the United States averaged 26.4 percent of adjusted gross income. In 2009, the most recent year reported, the rate was 19.9 percent.
- The group’s average income in 2009 was $202 million — thats a “wage” of $97,000 per hour, based on a 40-hour workweek.
- More than a quarter of these ultrawealthy paid less than 15% of their take in combined federal income and payroll taxes. Half of them paid less than 20%. And a few paid ZERO.
- Buffet prefers a cutoff point somewhat above $250,000 — maybe $500,000. And additionally Congress should enact a minimum tax on high incomes around 30 percent of taxable income between $1 million and $10 million, and 35 percent on amounts above that. A plain and simple rule like that will block the efforts of lobbyists, lawyers and contribution-hungry legislators to keep the ultrarich paying rates well below those incurred by people with income just a tiny fraction of ours. Only a minimum tax on very high incomes will prevent the stated tax rate from being eviscerated by these warriors for the wealthy.
- Buffet says we need to get rid of arrangements like “carried interest” that enable income from labor to be magically converted into capital gains. He is sickened that a Cayman Islands mail drop can be central to tax maneuvering by wealthy individuals and corporations.
- More importantly we can’t let those who want to protect the ultra-privileged get away with insisting that we do nothing until we can do everything. Our government’s goal should be to bring in revenues of 18.5 percent of G.D.P. and spend about 21 percent of G.D.P. — levels that have been attained over extended periods in the past and can clearly be reached again: this ratio of revenue to spending will keep America’s debt stable in relation to the country’s economic output.
- In the last fiscal year, we were far away from this fiscal balance — bringing in 15.5 percent of G.D.P. in revenue and spending 22.4 percent. Correcting our course will require major concessions by both Republicans and Democrats.
All of America is waiting for Congress to offer a realistic and concrete plan for getting back to this fiscally sound path. Nothing less is acceptable. Entitlements need to be adjusted to more realistic expectations. Budgets need to be cut aggresively without damaging the welfare of the most needy. Billions of dollars of waste has to be fought with the same gusto that we fight other wars. We need to become energy self-sufficient. We need to incentivize companies to keep money in the USA, and return the 2+ trillion dollars that have managed to escape our US economy.
No, I am not one to fight the wealthy at all: I am a true capitalist at heart. But dirty capitalism is where a select few benefit at the expense of others, and I do not subscribe to that. I think that is un-American. Why should a salaried person earning $ 1 million pay double the taxes of another person earning the same?
Surely this prudent, smart, practical Buffet-style policy will produce a robust economy, rampant growth, and ample opportunity to lower taxes in the future?
Sunday, November 11th, 2012
Posted on November 10th, 2012 by Leonard Steinberg
In all the discussions about THE FISCAL CLIFF both parties are revealing to the world just how incompetent (and corrupt?)they really are when it comes to identifying what ‘rich’ is. Both are behaving in a discriminatory fashion that is pretty astounding. I know I keep repeating myself when I say this, but when Obama claims that ALL Americans EVERYWHERE who earn more than $ 250k are equally rich, I have to wonder about his brain capacity or worse, his intentions. If earning $ 250k per year in New York is viewed the same as earning $ 250k in Tulsa (without any adjustment for cost-of-living), then I am afraid we have not all been created equally in the eyes of this President. Surely if affirmative action was designed to help those disadvantaged by a system based on race, the same should be true for cost of living?
Just in case Obamanomics does not understand this simple economic fact, or chooses to ignore it, here are the FACTS about the difference in the cost of living as provided by BANKRATE.com:
||New York-White Plains-Wayne NY-NJ Metro Div. – New York (Manhattan) NY
||Tulsa OK Metro
|Payment + Interest
|Half Gal. Milk
The reality is, housing is a massive percentage of all American’s cost of living. Ignoring this fact is outrageous and discriminatory. So if the average home in Manhattan costs 6x more than in Tulsa, surely President Obama should acknowledge this somewhere in the new tax legislation?
And just when you thought I was done with my rant, lets cross over to the other side of the aisle where BOEHNOMICS imagines all wealthy paying the same taxes. Really? Why does he not address the fact that someone who earns $ 1million per year in salary often pays double and tripe the taxes that someone self-employed? Why are the Republicans ignoring (or choosing to ignore) this?
Both parties need to remember that not all Americans are idiots and that by enacting laws that discriminate and ignore facts, they are both opening up the door widely for a THIRD PARTY to enter this system and throw both of them out of office. PLEASE Mayor Bloomberg, be the voice of reason here and help us form a third party to either remove the idiots or encourage them through political force to act more responsibly.
And in case anyone reading this thinks I am whining on behalf of the rich, they are simply wrong: I believe a combination of tax increases and spending cuts AND efficiency implementation (has either side mentioned this little inconvenient fact?)are critical to correct our debt crisis. Doing so intelligently and with the fairness ALL Americans are entitled to is what I am yelling about.
Thursday, December 22nd, 2011
Posted by Leonard Steinberg on December 22nd, 2011
The word RICH has to be one of the most used words of 2011….it also happens to be a four letter word. Just like the word LUXURY, it also has to be the most mis-used word, although in this lie many similarities.
What is rich? What is luxury? Both are very much words that have great meaning when evaluated relatively. To most earning $ 250,000.00 per year, someone earning $ 2 million per year is rich, while they consider themselves well off at best. Many million dollar earning bankers view themselves as poor next to movie stars and basketball players. To most buying an Hermes Kelly bag is luxury, while for someone else a Coach bag has the same value. Luxury can be a material object, service, etc., conducive to sumptuous living, usually a delicacy, elegance, or refinement of living rather than a necessity. Luxury is free or habitual indulgence in or enjoyment of comforts and pleasures in addition to those necessary for a reasonable standard of well-being. It can also be a means of ministering to such indulgence or enjoyment. Luxury can be a pleasure out of the ordinary allowed to oneself. It can also be a foolish or worthless form of self-indulgence: the luxury of self-pity. Its all very, very relative though.
Rich is defined as having wealth or great possessions….. abundantly supplied with resources, means, or funds: the big question is who defines what abundant is. Right now the world seems entirely focused on income as the definition of wealth. A co-op Board frowns on high income alone and does not consider that to be rich without substantial assets too. Old Money is often assets-rich and income-poor……so is someone with OLD MONEY rich if they cannot afford to replace the tattered curtains in their living room? Then again, someone rich in Montana, may be quite middle class in Manhattan, a best.
I find that the bigger struggle is actually within the so-called ONE PERCENT: I constantly hear the outrage of people who thought buying a one MILLION dollar apartment in New York would deliver the home of their dreams….the dissilussionment at the reality is Austin Power-style in its shock. TO buy a $ 3million apartment in New York these days, you probably need an income of at least $ 1million per year: thats not the 1% at all….. A $10 million apartment buyer would need to earn lots more than that……more like the 0,001%. I hear many who earn around $ 500k a year furious at those earning $ 5 million per year who pay less taxes than they do benefitting by all kinds of legal breaks that they simply do not have access to.
So while the class war that exists between the 99% and the 1% is potent, even more extreme is the class warfare within the 1%. Its all relative at the end of the day. All of it. I feel certain that the poor in Africa would consider the poor in the USA well off. Maybe RICH and LUXURY are the most mis-used words of 2011?
Wednesday, September 8th, 2010
The Obama administration is about to define ALL single persons earning $ 200,000.00 or more or ALL couples earning $ 250,000.00 or more rich: It is time we stand up to this sheer stupidity.
Yes, these incomes would definitely qualify you as rich in Oklahoma City or a small town in Vermont, but it is VERY far from rich in a city such as New York City. It may indeed be necessary to raise taxes on the rich, but it is even more important, if we are to be American, to be fair. A BIG CITY FEDERAL TAX CREDIT is long overdue. Big cities drain national resources significantly less than smaller cities. They are much more efficient. but they are much more expensive to live in as well. Housing costs are often double, triple or even qudruple that of smaller cities and towns. Food, education, pretty much everything is more expensive. Yet Washington is incapable of recognizing this fact? Thats a national disgrace!
New York City residents should stand up for their rights now and demand a re-definition of the term ‘rich’ to take into account city-by-city cost of living immediately.
“A New York couple who earns $ 250,000.00 a year can afford an apartment that costs about $ 750,000.00 if they were to obtain a mortgage,” says Leonard Steinberg, managing director of Prudential Douglas Elliman and leader of the LUXURYLOFT team. “Where in New York City can you find a RICH PERSON’S apartment for $ 750,000.00? In Manhattan especially, earning $ 250k per year does not make you rich by any standards. Washington is completely out of touch with the real world.”
The ‘Bush tax cuts’ are set to expire at the end of 2010. Regardless of the increase in the tax rates, this is what we suggest:
1) Introduce a BIG CITY Federal Tax Credit based on the city you reside in calculated by the differential in cost of living. IE: Those earning $ 250k in Tupelo, Mississipi should not pay the same tax rate as those living in Manhattan.
2) Identify the large tax avoiders, those with access to the most ‘sophisticated’ accountants and lawyers who often pay taxes at half the rate the rest of us do, while earning ten times more.
3) Why ZERO estate taxes for just one year: revoke this stupid law that amounts to a windfall for a lucky few (at the expense of all of us) and introduce lower estate taxes for all…..or use the lost estate tax revenue of 2010 to pay down the national debt!
4) Raise the retirement age to adjust for the fact that we are living longer.
5) Make everyone pay SOME Federal taxes…even if its a little. No-one should get a free ride. We should all contribute. That way more people would vote too.
6) Cut the waste. Introduce more tech-based efficiencies to government. Fire corrupt government employees + jail them with double time.
7) Corporations and private equity are sitting on $2.5 TRILLION dollars in cash, but they are not hiring. Provide tax credits for hiring. Every individual employed, becomes a contributor to the economy by not only consuming and spending, but also reducing their need to tap into federal funds (our tax dollars) to foot their unemployment bill. Its cheaper than keeping them un-employed…..by far.
8) Re-evaluate illegal immigrant reform now: Charge all illegal immigrants a one-time fee ($ 250?) to become legal. 11 million x $ 250 can help to pay down the deficit. 11 million consumers, paying taxes (if they are collected!) will help fuel the economy. Make learning English a pre-requisite for citizenship. 1 common language unites a country and eliminates the cost of bi-lingual government (it costs BILLIONS every year!).
9) Don’t focus on raising tax rates! Focus on collecting the taxes owed. Our constitution is quite clear about us all being created equal, no?