2006 Personal Savings Fall to 74-Yr. Low
Now, why do I bring this to your attention? The answer lies in the article, in this sentence:
The savings rate is computed by taking the amount of personal income left after taxes are paid, an amount known as disposable income, and subtracting the amount of spending.
Emphasis mine, because you'd miss it otherwise. In other words, disposable income is what the government lets you keep.
Now, the problem is actually bigger than this. Let's look at it this way: the price of everything you buy, whether it's a loaf of bread, a big screen TV, or help doing your income taxes, includes a chunk that is handed over to the government. The price of that loaf of bread includes the taxes collected from the guy who grew the wheat, the guys who milled it into flour, the guys who baked it into loaves of bread, the guy who drove the bread to the store, the gal who rang it up, the kid who put it into a bag for you, the manager of the store, and let's not forget the gasoline taxes paid to transport raw materials and finished goods, utility taxes on the electricity, gas, and water, etc. I've seen it estimated that if that loaf of bread has twenty slices, six of them go to the government. That's over and above what your employer takes out of your check and passes along to the government, along with other taxes that they pay for the privilege of having you work for them.
The AP and most of the rest of the mainstream media would like you to believe that Americans are frittering away their life savings on big screen TVs and trips to the nail parlor. (Of course, there are plenty of people in this world, many of them Americans, who depend on you buying big screen TVs and trips to the nail parlor. But let's ignore that for a minute.) The truth is that we're spending a lot of our lives supporting the people who want to make the rules for games they neither understand nor want to participate in.
Do the math: I have to earn $1.25 to pay for a $1 loaf of bread that actually costs $0.70. That's 55 cents in taxes on a 70 cent loaf of bread. That's a tax rate of 78 percent. That might make a small contribution to the lack of savings. Wouldn't you say?
The AP and most of the media's not going to tell you that. You might hear it on talk radio, though Congress is working on finding ways to shut down talk radio. That's why I'm doing this, as a public service. No need to thank me.