[TowerTalk] TH6 pricing at introduction - UTTER NONSENSE!
Robert L. Shohet
kq2m@mags.net
Thu, 20 Jan 2000 08:35:48 -0800
Pete Smith wrote:
>
> At 10:48 AM 1/18/2000 -0500, Kent wrote:
> >Pete,
> >
> >In 1968, the TH6-DX sold for $ 149.50 ( Allied Radio price )---I bought mine
> >from its original owner in 1974 for a grand total of $ 25.00. I used it from
> >1974 until last year when I put up a TH-11DX. The TH-6DX was, by far, the
> best
> >money I ever put into any piece of ham equipment-----talk about getting your
> >money's worth..........
>
> Thanks to Kent and Ed, W3EKT, who gave me the 1966 list price of $139.50.
> I responded to Ed...
>
> "Great Ed -- thanks a lot! The actual numbers work like this --
>
> CPI increase since 1966 = 5.1 times
> Per capita income increase since 1966 = ~ 8.15
>
> Effective (purchasing power adjusted) price of the TH6 in today's dollars =
> $1129.95
>
> Even granted that retailers may not have been selling it quite at list, I
> guess times really ARE better than ever!"
>
> Thanks to Kent, I have another good data point -- looks like they were
> getting list price after all.
>
> 73, Pete N4ZR
>
> Don't forget to update your entry in the World Contest Station Database
> http://206.102.70.3/search.htm
>
> --
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You know these are the kind of THOUGHTLESS comparisons that do a LOT of
damage and grossly distort reality!
In the first place, I DON'T know of many professionals or salaried folk
who have had increases in annual income of 8x since 1966, so this is
BUNK! Many people would love to be earning 5x what they did back then.
Many more would settle for not LOSING their job or have already taken
poorly paying jobs to support their family because they were
"downsized".
IN ADDITION, the person who "thought" of this comparison must have a job
that affords him the luxury of NOT paying either FICA/MEDICARE tax OR
state and federal income taxes! Although I do not remember or care to
research what the tax rates were back then, they were MUCH lower on a
proportionate amount of income. That is you paid A LOT LESS TOTAL TAX
on that same dollar of salary than you do today!
What does this mean?
Well for example, if you earned $10,000 in 1966 (a pretty decent salary
back then!) you paid "bupkis" in FICA/MEDICARE somewhere about 2% I
believe and almost nothing in State/Federal Tax. I'll guess about
$1,200 tax total. This left you with $8,800 to support yourself and
your family and it WAS a struggle - at least here in the Northeast it
was anyway, BUT you could own a home if you could afford the
down-payment. If you were self-employed you paid MORE tax and had LESS
left over!
To use the "logic" of the comparison, this same person would be earning
$80,000 today - (Oh yeah? what percentage of your friends and
acquaintances actually earn $80,000 per year?). Let's examine how this
is taxed....
First you have FICA/Medicare of 7.65% on the first roughly $77,000 and
1.45% on the other $3,000. Hmmmmm... $5,934. If you are self-employed
you pay DOUBLE this amount (because with salary the employer pays the
other half but if you work for yourself you pay BOTH). Now we have
Federal tax at the rate of 28% above $41,000 and 15% below it. This is
another $17,070! Then we have a marginal state tax rate of about 8% in
Connecticut which adds another $6,400.
GEE, this means that someone pays $29,404 tax on $80,000 salary. Which
leaves about $50,000. That's 36.8% TAX! vs. 12% in 1966! I don't know
ANYONE who can own a home in Connecticut and support a family on $50,000
NET. We have NOT even included Life Insurance, Medical Insurance,
Dental Insurance, braces for the kids, vacations, piano or karate
lessons for the kids or anything else! FORGET ABOUT IRA's, 401(K)'s or
ANY type of savings! Oh, I almost forgot. McDonalds hamburgers could
$0.08 back then. 8 PENNIES. What do they cost today? $1.29! This is
quite relevant because with $50,000 NET they could not afford to buy
steak, fish or anything else much less go out to a restaurant. A family
earning $50,000 NET here could barely afford a MOBILE home let alone a
house! Buy a TH6 for $1,100 or $700 or even $500? THAT'S A CRUEL JOKE!
Yes, I have not taken into account the income tax deductions/exemptions
that are allowed. But I have also NOT taken into account any capital
gains and or dividend income which could more than offset any
deductions.
Is is a perfect comparison? NO, it was not meant to be. It was meant
to illustrate how ABSURD, thoughtless and insulting it is to TRIVIALIZE
the cost increases of purchases that we consider as consumers and hams
and that times are so much better than they used to be. (We can discuss
the fact that many people work 80+ hours a week and travel too, some
other time!)
It is due to the lack of thought before a purchase is made that people
wind up in debt is a MUCH MORE SERIOUS problem today than in 1966. It
is due to the fact that few people really understand how little they can
actually spend because of the ravages of taxes and the lack of thought
of how they are going to pay for their new toy. The comparison that was
made previously clearly shows the lack of forethought of what an item
really costs, how little money is really available to purchase it and an
ignorance of how few pepole have really earned the "index" increases in
their income.
It is an argument that I would expect a TH6 salesperson to make, not an
actual consumer.
Maybe in the future people will THINK about these type of misleading and
inaccurate comparisons and REFRAIN from making them before having the
urge click on the "send" button on their e-mail.
73
Bob KQ2M
--
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