Thursday, August 4, 2011

To a president Obama, an open letter

Hello Mr. president,
Can you tell me how on earth president and all his advisers could possibly expect economy to grow while people do not have money to spend?
Why is that you may wonder.
Lets start from beginning.
In most of the cities of USA rent is so high that people cannot afford any luxuries at all.
New York city.
Average household income for family of 4 is $44,600.00.
Average rent for one(!!!) bedroom for that same family is $1800, plus utility such as electricity, phone, gas for cooking. All together it sum up to $2000 per month.
For a year it will be $24000.
Taxes for family of 4 plus Medicaid and Social security taxes, federal, local takes out around 20% of income($8,920.00). So how much money left to spend? $44600-$8920-$24000=$11680.
That would be less than $1000 per month for entire family or less than $10 per day per person. Travel to work(school, college etc) is $4.5 now, just a bagel with cup of coffee $2. How much left for dinner and launch - $3.5. What about clothes, books or anything else we must have?
What can we afford to buy?
Barely enough food to just feed our children that is what.
No luxuries or extra spending at all. Even visit to a movie became a grand adventure now.
How do you expect your economy to grow if you do not care about by people who is back bone of that economy?
Why don’t you make rent tax deductible for families earning less than for example $100.000.00 but at the same time raise taxes specifically for landlords with luxury apartments (leases $1200+). In most cases those apartments are the same as regular one, priced as luxury just because landlords pushed rent to go outside of rent regulations law limits.
This way it will prompt landlords to stop raising rents just because they can and politicians to do better jobs to control what is going on in their cities.

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