Thousands of French Households Taxed Over 100%

More than 8,000 French households' tax bills topped 100 percent of their income in 2012, according to a French newspaper report.

Citing data from France's finance ministry, the business newspaper Les Echos reported on Friday that in addition to those taxed at over 100 percent last year, almost 12,000 households paid taxes worth more than 75 percent of their 2011 income and that a further 9,910 households were taxed at more than 85 percent of their income.

The paper said this was due to a one-off levy imposed on the 2011 incomes of households with assets of more than 1.3 million euros ($1.67 million). The surcharge was introduced by socialist President Francois Hollande in an attempt to offset the cost of a rebate scheme and taxation cap introduced by former President Nikolas Sarkozy, the paper added.

"In 2011, 5,221 households had a tax rate of more than 100 percent on their revenues, Some 6,203 households had a rate of more than 85 percent and 6,343 house holds a rate of more than 75 percent," the newspaper said but households could take advantage of a "tax shield" introduced by Sarkozy to cap an individual's overall taxation at 50 percent of their income. Read more >>

Median Income Worse Now Than It Was During Great Recession

A new report put out by the Pew Research Center finds that the median income is worse now than it was during the Great Recession.

According to Pew, the Census Bureau showed that the median income for American households in 2009 – the official end of the Great Recession – was $52,195 (in 2011 dollars), while the median income dipped to $50,054 last year, falling 4.1 percent over two years.

“The decrease in household income from 2009 to 2011 almost exactly equaled the decrease in income in the two years of the recession,” the Pew report stated. “During the Great Recession, the median U.S. household income (in 2011 dollars) dropped from $54,489 in 2007 to $52,195 in 2009, a loss of 4.2 percent. By this yardstick, the recovery from the Great Recession is bypassing the nation’s households.” Read more >>

The Rich Are Getting Richer And Everyone Else is Going Deeper Into Debt

Growing income inequality has led to ballooning debt loads for the bottom 95% of Americans.

 The bottom 95% of Americans have seen debt levels balloon compared to their earnings over the past 20 years or so, as falling incomes made them more dependent on credit to maintain their lifestyles. In 1983, the bottom 95% had 62 cents of debt for every dollar they earned, according to research by two International Monetary Fund economists. But by 2007, the ratio had soared to $1.48 of debt for every $1 in earnings.

The bottom 95% had incomes of roughly $160,000 or less in 2007, including capital gains. And then there's the top 5%. Their debt-to-income level actually fell during the same period, from 76 cents of debt for every dollar earned in 1983, to just 64 cents in 2007. And experts say the picture hasn't changed much since then. 

The debt divide is a result of the growing income gap between the wealthiest Americans and everyone else. The top 5% saw their share of total income rise to 34% in 2007, up from 22% in 1983. This excludes capital gains, which pump up the income of the rich even more since they are more likely to invest. More...

Americans’ Incomes Have Dropped 6.7 Percent During the ‘Recovery’

According to Sentier’s report, the median American household income has actually fallen during the “recovery.” Not only that, but it has fallen even more than it did during the recession. Gordon Green, former chief of the Governments Division at the U.S. Census Bureau and co-author of the report (with fellow Census veteran John Coder), says, “Real income fell by 3.2 percent during [the recession]. And during the recovery it went down by 6.7 percent.” So “income [has] declined twice as much in the recovery as in the recession itself.”

While the real median income of American households dropped 6.7 percent during the first two years of the “recovery,” the incomes of many households dropped even more than that. The income drop was steeper for those under 25 years of age (their incomes were down 9.5 percent), for those between 25 and 34 years of age (down 9.8 percent), for black Americans (down 9.4 percent), for families with three or more children (down 9.5 percent), and for families headed by part-time workers (down 11.5 percent). And that’s despite the fact that the report’s income tallies include unemployment compensation and monetary public assistance (both state and federal). More...

US poverty rate rose to 15.1% in 2010

Image via WikipediaAmid a still struggling economy, more Americans fell below the poverty line last year, according to new census data released Tuesday. The nation's poverty rate rose to 15.1% in 2010, its highest level since 1993. About 46.2 million people are considered in need.

The government defines the poverty line as income of $22,314 a year for a family of four and $11,139 for an individual. The Office of Management and Budget updates the poverty line each year to account for inflation.

As for middle-class American families, income fell in 2010. The median household income was $49,445, down slightly from $49,777 the year before.

Overall, median income has changed very little compared to rising consumer prices over the last 30 years. Adjusted for inflation, the middle-income family only earns 11% more than they did in 1980, while consumer prices have risen roughly 155%. More...

Consumer Spending Across All Income Groups Down in August

Year-over-year self-reported spending is down compared with July 2010 and August 2009

by Dennis Jacobe, Chief Economist

PRINCETON, NJ -- Americans' self-reported average daily spending in stores, restaurants, gas stations, and online averaged $63 per day during August -- down $5 from July, and down $2 compared with August 2009. Consumer discretionary year-over-year spending is thus running just slightly below the depressed "new normal" rate of a year ago.

Upper-Income Spending Remains Far Below May 2010 Levels

Upper-income Americans (those making $90,000 or more annually) reported spending an average of $109 per day in August, down $10 from June and July, and down $36 from May. Spending among this group is also down $7 compared with August 2009. Only once -- in May -- has 2010 upper-income spending exceeded the 2009 "new normal" spending range of $107 to $121 per day.

Month-Over-Month Middle- and Lower-Income Spending Falls

Middle- and lower-income Americans spent an average of $54 per day during August -- down from $64 in July and $62 in June, and lower than the $57 seen in August 2009. Americans in these income groups had been spending at the higher end of last year's "new normal" range of $52 to $61 but are now back to the lower end of that range. More...