Obama: $85,000 is Rich

Retired as a city worker, Sheila Pugach lives in a modest home on a quiet street in Albuquerque, N.M., and drives an 18-year-old Subaru.

Pugach doesn’t see herself as upper-income by any stretch, but President Barack Obama’s budget would raise her Medicare premiums and those of other comfortably retired seniors, adding to a surcharge that already costs some 2 million beneficiaries hundreds of dollars a year each.

More importantly, due to the creeping effects of inflation, 20 million Medicare beneficiaries would end up paying higher “income related” premiums for their outpatient and prescription coverage over time…

Currently only about 1 in 20 Medicare beneficiaries pays the higher income-based premiums, which start at incomes over $85,000 for individuals and $170,000 for couples. As a reference point, the median or midpoint U.S. household income is about $53,000…

The administration is proposing to extend a freeze on the income brackets at which seniors are liable for the higher premiums until 1 in 4 retirees has to pay. It wouldn’t be the top 5 percent anymore, but the top 25 percent.

This is from the Associated Press.

Comments (13)

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  1. Sandeep says:

    If someone is comfortably retired ($85,000), why should they be taxed the same way someone who is earning the same amount as a working salary. I think it is unfair for one to be retired to be taxed such a high amount. But again, I think taxing should be cut back as much as possible.

  2. Kumar says:

    When will the taxing ever stop? Not even in retirement, and then there is death tax. Are you kidding me?

  3. Patel says:

    Taxation is a complicated system, and you add to that the federal government is only getting bigger, one can expect more tax-regulations and complications. We need taxation reform.

  4. Desai says:

    The only way to cut down on the complications surrounding taxation, is to cut down on the government. Big governments mean more regulation, hence, more complicated taxation.

  5. A.D. Samson says:

    “It wouldn’t be the top 5 percent anymore, but the top 25 percent.”

    – Give an inch, they take a mile!

  6. Chris says:

    This is simply absurd! Obama continually expands his view of “upper class”.

  7. Sam says:

    I doubt a retired person making 85k a year is “modest.” Bad example, especially as she lives in NM, where the cost of living isn’t even that high.

  8. Ron says:

    If 85k is rich, I wonder what a multi-million income figure is considered…

  9. H. James Prince says:

    We need to change the enrollment age, not the benefits. A 65-year-old retired city worker is not an invalid.

  10. Frederick H. says:

    Retired workers should, by no means, be charged the same as an employed individual, even if they have the same or similar incomes. Retired individuals certainly receive certain benefits, but they have earned them, and they have reached the age where they can’t or are not allowed to work anymore. So they are going to get penalized for that too? A retired worker who earns, say $85k, is NOT the same as a person who earns that same amount but is currently employed. This administration is clueless as to how to run the taxation system!

  11. Jenny M. says:

    To be rich usually means, though not necessarily always, that you get to enjoy a luxurious lifestyle by choice. How many people these days that earn $85k can actually do that? Very little, if any! With an income of $85k you certainly get to enjoy certain things that many others don’t, but with many many many limitations. It is so ignorant that this President even dares to make such a statement..

  12. ColoComment says:

    I dont’ know where y’all live, but in northern Colorado $85k is a more than decent salary, and if I could manage to receive $85k/yr in retirement, I’d count myself rich beyond my wildest dreams.

    SOMEone has to pay the increased cost of benefits (and the middle quintiles is where the money is.) Or you have to reduce the amount of benefit per recipient, or decrease the number of recipients. It’s math, sure, but it’s easy math: just do the numbers.

    There’s no reason why retirees can’t be asked to contribute more to their own health care. The elders of this country are, as a group, the wealthiest group by far. There would be some opportunity cost. So be it.

  13. Dennis Byron says:

    @ H. James Prince

    What makes you think the “retired city worker” is 65? Probably not even 60 yet.


    As for the rest of the story, it is totally misleading

    — comparing retirement salary to the median of all workers is devious. compare it to the median of all retired people

    — this is old news and has already happened in Obamacare, which froze the indexing so that the needle moves from top 5% to to top 15%