Mendo Island Journal — Timely. Useful. Sometimes Cranky.

Stop Coddling Us, the Super-Rich

In Around the web on August 15, 2011 at 8:21 am

From WARREN BUFFETT
NYT

Our leaders have asked for “shared sacrifice.” But when they did the asking, they spared me. I checked with my mega-rich friends to learn what pain they were expecting. They, too, were left untouched.

While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks. Some of us are investment managers who earn billions from our daily labors but are allowed to classify our income as “carried interest,” thereby getting a bargain 15 percent tax rate. Others own stock index futures for 10 minutes and have 60 percent of their gain taxed at 15 percent, as if they’d been long-term investors.

These and other blessings are showered upon us by legislators in Washington who feel compelled to protect us, much as if we were spotted owls or some other endangered species. It’s nice to have friends in high places.

Last year my federal tax bill — the income tax I paid, as well as payroll taxes paid by me and on my behalf — was $6,938,744. That sounds like a lot of money. But what I paid was only 17.4 percent of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent.

If you make money with money, as some of my super-rich friends do, your percentage may be a bit lower than mine. But if you earn money from a job, your percentage will surely exceed mine — most likely by a lot.

To understand why, you need to examine the sources of government revenue. Last year about 80 percent of these revenues came from personal income taxes and payroll taxes. The mega-rich pay income taxes… Complete article here
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  1. Mr. Buffet enjoys pretending he is somehow different than his mega-rich pals who, in the complete editorial, he characterizes as “very decent people”, but he is no different save for being a phony blowhard. He does not say how much of the not-quite seven million dollars in taxes he paid were payroll taxes and how much was for his personal income, nor does he mention that his personal share of this paltry sum was paid on “taxable” income and not on actual income, most of the hundreds of millions of which were obviated by deductions and deferments allowed by our tax system, deductions designed to allow Mr. Buffet and his mega-rich friends to report only a tiny fraction of their income as taxable. Nor does he mention that he is, for all intents and purposes, a corporation, and so is privy to greatly diminished taxes and tax loopholes that further reduce his tax liability. “Come on, raise taxes on rich people,” he says, knowing the corporate congress wouldn’t dare, and further knowing that he has it in his own power to dispense his vast fortune far more helpfully and generously than our corrupt government ever could.

  2. Are you sure you’ve got the right Warren Buffet, Todd?

    The guy is filthy rich, but he has maintained for many years that “our” tax system is grossly skewed in favor of the wealthy, and he has also dispensed a whopping $30+ billion charitable contribution to the Gates Foundation. In the full article, he seems to say a lot of things folks wish the current congress would be a little bolder about saying. As old Warren himself has publicly stated, “It’s class warfare – my class is winning, but we shouldn’t be.” He’s shrewd and successful, but simply having money doesn’t necessarily make someone a bad person, anymore than not having it bestows an automatic righteousness. I wonder how much income goes unreported and untaxed right here in Mendoland? Probably more than enough to salvage all our local public services.

  3. Yes, I’m sure I have the right Warren Buffet. And you’re right, he’s been making this same speech for many years and doing nothing to help change the tax laws except making this same speech. I didn’t say he was a bad person, though he might be. I said he was a phony blowhard, and until I have evidence to the contrary, I’ll stick with that. And I’m sure you’re right that millions of dollars of income goes unreported and untaxed in Mendoland, and all over the country, too. Unfortunately, even if all the income that should be reported was reported and taxed, 30% of the tax money would go to paying the interest on the national debt owed to the “very decent people” Warren Buffet knows so well, 30% would go to financing war-related industries owned by the same “very decent people”, and very little of the money, if any, would go to people who need it most.

  4. Perfectly legal: the covert campaign to rig our tax system to benefit the … By David Cay Johnston explains it all and reveals why it is the system itself is set up to concentrate wealth incessantly.

    http://books.google.com/books?id=KZ-VCFhjGrgC&printsec=frontcover&dq=perfectly+legal+david+cay+johnston&hl=en&src=bmrr&ei=JHNNTsHWM_HUiALktu2dAQ&sa=X&oi=book_result&ct=result&resnum=1&ved=0CCoQ6AEwAA#v=onepage&q&f=false

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