Warren Buffett: Stop coddling the super rich(nytimes.com)
nytimes.com
Warren Buffett: Stop coddling the super rich
http://www.nytimes.com/2011/08/15/opinion/stop-coddling-the-super-rich.html?_r=1&smid=tw-nytimesbusiness&seid=auto
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It looks like Joe Nocera got his wish from a week ago.
"I keep waiting for one wealthy, well-known figure to stand up and say publicly that he or she is willing to pay more in taxes as part of the shared sacrifice necessary to gain control of the country’s deficit."
http://www.nytimes.com/2011/08/09/opinion/nocera-while-the-m...
"I keep waiting for one wealthy, well-known figure to stand up and say publicly that he or she is willing to pay more in taxes as part of the shared sacrifice necessary to gain control of the country’s deficit."
http://www.nytimes.com/2011/08/09/opinion/nocera-while-the-m...
I suspect that the kind of people working behind the scenes to keep things as they are aren't anywhere near the super rich but the well off for who a high tax rate would impact their standard of living. Once you get up to the super rich they really aren't putting all earnings into the standard of living they keep.
(Don't have anything to back this up, just the impression I get from reading bits and pieces on the issue)
(Don't have anything to back this up, just the impression I get from reading bits and pieces on the issue)
The more I hear about this guy, the more I like him. He is so frank, it seems like he'd be a very interesting person to meet.
I wish Buffett would run for president. He could probably get a few things done.
What's missing is an estimate of the revenue impact of doing what Buffet suggests.
I've always heard that this kind of policy would add little to revenue, because there is simply far more tax money available by taxing earned income.
I've always heard that this kind of policy would add little to revenue, because there is simply far more tax money available by taxing earned income.
Voluntary gifts of money can be sent to the U.S. Treasury at this address:
http://www.fms.treas.gov/faq/moretopics_gifts.html
One has to ask, if any super rich person really considered the U.S. Government a worthwhile investment, why are they donating to various charities instead of to the Treasury?
http://www.fms.treas.gov/faq/moretopics_gifts.html
One has to ask, if any super rich person really considered the U.S. Government a worthwhile investment, why are they donating to various charities instead of to the Treasury?
Reading this just makes me think of all of the lobbying dollars and campaign contributions that must have been paid by the super-rich to get these tax breaks.
Am I the only one that feels some populist rage welling up when he hears how much money is wasted on campaigning for office and influencing people in office? Aren't there more worthy uses of wealth and scarce resources?
And it just pains me that so many people think that they "have to play the game" to get things done by politicians. Non-profit organizations that use large percentages of their spend on "wining and dining" elected or appointed officials to try to make things beneficial things happen. Ugh.
Am I the only one that feels some populist rage welling up when he hears how much money is wasted on campaigning for office and influencing people in office? Aren't there more worthy uses of wealth and scarce resources?
And it just pains me that so many people think that they "have to play the game" to get things done by politicians. Non-profit organizations that use large percentages of their spend on "wining and dining" elected or appointed officials to try to make things beneficial things happen. Ugh.
If we want shared sacrifice, maybe we should ask people at the bottom to share as well. Anecdotes of Warren Buffet's office aside, in general the richest people pay the largest proportion of taxes.
We already lean quite heavily on the top 1% - the top 1% actually pays more in taxes than the bottom 90%.
http://www.taxfoundation.org/news/show/22652.html
A graph of the data in that article:
http://i.imgur.com/wa8uu.png
In terms of taxation of the top 10%, the US is the most progressive country in the OECD.
http://www.taxfoundation.org/blog/show/27134.html
Maybe the tax code needs tweaking at the level of the top 400, but it's very progressive up to the level of the top 1%.
We already lean quite heavily on the top 1% - the top 1% actually pays more in taxes than the bottom 90%.
http://www.taxfoundation.org/news/show/22652.html
A graph of the data in that article:
http://i.imgur.com/wa8uu.png
In terms of taxation of the top 10%, the US is the most progressive country in the OECD.
http://www.taxfoundation.org/blog/show/27134.html
Maybe the tax code needs tweaking at the level of the top 400, but it's very progressive up to the level of the top 1%.
The problem is getting low to middle income people to stop voting against themselves. Good luck with that, they all seem to think they are going to be billionaires someday so better keep those billionaire taxes low.
Either that or by bribing the wealthy with low taxes they might only ship out half the jobs overseas instead of all of them.
It's just dumbfounding. Election after election, over and over.
Either that or by bribing the wealthy with low taxes they might only ship out half the jobs overseas instead of all of them.
It's just dumbfounding. Election after election, over and over.
As a freshly minted middle-class American, I disagree with Mr. Buffet's argument here. Though his eagerness to share the tax-burden is laudable, I hope that tax rates stay low for him. I would pay higher taxes to keep it that way.
Simply put, I don't trust the government with that money.
Simply put, I don't trust the government with that money.
Could everyone make sure every Republican and Tea Partier they know reads this? Republican concerns are critical to this country, but the current incarnation is deeply harmful.
Funny. Buffett certainly didn't mind a little coddling in 2008. He was arguably one of the largest individual beneficiaries of bailouts which shifted ungodly amounts of toxic debt from failed private institutions to taxpayers. See http://blogs.reuters.com/rolfe-winkler/2009/08/04/buffetts-b....
While it's now mighty generous of Buffett to invite the government to increase his taxes, he could spare us another (http://www.cnbc.com/id/40229527/Warren_Buffett_s_Letter_to_U...) nauseating and embarrassing New York Times op-ed and instead put his money where his mouth is. As another poster has noted, the Treasury will gladly cash Buffett's check (http://www.treasurydirect.gov/govt/reports/pd/gift/gift.htm).
While it's now mighty generous of Buffett to invite the government to increase his taxes, he could spare us another (http://www.cnbc.com/id/40229527/Warren_Buffett_s_Letter_to_U...) nauseating and embarrassing New York Times op-ed and instead put his money where his mouth is. As another poster has noted, the Treasury will gladly cash Buffett's check (http://www.treasurydirect.gov/govt/reports/pd/gift/gift.htm).
Warren buffet pays about 17%, and the people in his office pay an average of 36%. So the solution, the way to restore fairness, is to raise taxes on him? I don't really think so. Maybe I'm a bit of a wingnut, but I find tax rates of about 30% disgusting simply on moral grounds, and I don't see why the discussion should go much further. Surely one of a government's prime constraints should be not screwing its citizens?
Taxing the money that moves - as it is earned - will only produce so much revenue. The rich need to be taxed, not beccause it will allow lots of lovely spending, because the gov will inevitably do a bad job of spending it. Though you could put it towards debt reduction first.
You have to tax the money that doesn't move. The millions of unneeded unspent $ that the rich are sitting on, with a wealth tax. You may not even make the poor richer, but you will make the rich poorer. Good.
You have to tax the money that doesn't move. The millions of unneeded unspent $ that the rich are sitting on, with a wealth tax. You may not even make the poor richer, but you will make the rich poorer. Good.
"But for those making more than $1 million — there were 236,883 such households in 2009 — I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains. And for those who make $10 million or more — there were 8,274 in 2009 — I would suggest an additional increase in rate. "
If you really want to see something get passed, you're better off putting the cutoffs at $5mil and $25mil(maybe even slightly higher). The $1mil cutoff sounds nice in a soundbite and it polls well, but it's not hard to find sympathetic faces(small businesses and large family farms) who would get caught up in that. His cutoffs would end up hurting the the "upper middle class" and the "lower rich" more than the "super rich".
And if you want "shared sacrifice", you should be talking about a consumption tax.
What this country needs most is a firm federal spending cap at 20% of GDP. There would be less opposition to raising taxes and balancing the budget if the measuring stick for spending wasn't tax revenues but the GDP.
If you really want to see something get passed, you're better off putting the cutoffs at $5mil and $25mil(maybe even slightly higher). The $1mil cutoff sounds nice in a soundbite and it polls well, but it's not hard to find sympathetic faces(small businesses and large family farms) who would get caught up in that. His cutoffs would end up hurting the the "upper middle class" and the "lower rich" more than the "super rich".
And if you want "shared sacrifice", you should be talking about a consumption tax.
What this country needs most is a firm federal spending cap at 20% of GDP. There would be less opposition to raising taxes and balancing the budget if the measuring stick for spending wasn't tax revenues but the GDP.
Thanks for the advice, Warren.
Can we have our Goldman bailout money back now?
Yours,
The U.S. Taxpayers
Can we have our Goldman bailout money back now?
Yours,
The U.S. Taxpayers
A couple of recent quotes of his: "I could end the deficit in five minutes. You just pass a law that says that anytime there is a deficit of more than 3% of GDP all sitting members of Congress are ineligible for reelection."
http://www.ritholtz.com/blog/2011/07/warren-buffett-i-could-...
Also, he's against having a debt ceiling. "All it does is slow down a process and divert people’s energy, causes people to posture. It doesn’t really make any sense,"
http://www.politico.com/news/stories/0711/59335.html#ixzz1V4...
http://www.ritholtz.com/blog/2011/07/warren-buffett-i-could-...
Also, he's against having a debt ceiling. "All it does is slow down a process and divert people’s energy, causes people to posture. It doesn’t really make any sense,"
http://www.politico.com/news/stories/0711/59335.html#ixzz1V4...
The combined wealth of American's billionaires is only $1.5 trillion. [1] If we taxed them 100%, it would only pay off our budget deficit for one year. We still have around 54 trillion total debt to pay down. Not to mention 115 trillion unfunded liabilities.
And which entrepreneurs would be stupid enough to work 14 hours a day and hire workers, knowing that the government will tax them 90%? They would all flee the country.
We have too much debt, period. From military, medicare, and social security spending. Problem is, if we reduce any one of these, either our soldiers returns home broke and angry, or the seniors die of starvation/disease. (35% of Americans already over the age of 65 rely almost entirely on Social Security payments alone. Median retirement savings of households over the age of 65 is less than $45,000).
Tough choice. But it looks like the current politicians aren't going to make a decision, but let Bernanke print dollars until hyperinflation arrives.
http://english.alarabiya.net/articles/2011/03/10/140943.html
And which entrepreneurs would be stupid enough to work 14 hours a day and hire workers, knowing that the government will tax them 90%? They would all flee the country.
We have too much debt, period. From military, medicare, and social security spending. Problem is, if we reduce any one of these, either our soldiers returns home broke and angry, or the seniors die of starvation/disease. (35% of Americans already over the age of 65 rely almost entirely on Social Security payments alone. Median retirement savings of households over the age of 65 is less than $45,000).
Tough choice. But it looks like the current politicians aren't going to make a decision, but let Bernanke print dollars until hyperinflation arrives.
http://english.alarabiya.net/articles/2011/03/10/140943.html
If Warren feels so guilty, then he should write a check to the US Treasury for his entire net worth.
If Buffet finds it so wrong that he pays so little tax, I am sure the IRS wouldn't mind if he paid more.
Personally I would adjust Social Security to the expected life time (and re-adjust it every year); get out of Iraq, Afghanistan and Libya; half the army (you got nukes, you don't need that big an Army to defend yourself) and stop the war on drugs.
Personally I would adjust Social Security to the expected life time (and re-adjust it every year); get out of Iraq, Afghanistan and Libya; half the army (you got nukes, you don't need that big an Army to defend yourself) and stop the war on drugs.
Warren is omitting very crucial information and knowingly deceiving most people. He's pretending he doesn't pay very many taxes, but he does, he just pays different taxes. In this article he mentions capital gains, income, and payroll taxes but does not mention corporate income taxes. Corporate income taxes are taxes on the owners of corporations. I don't know exactly how much he paid, but some quick math I'd guess he alone paid 1.6 billion last year in corporate income taxes. (Berkshire paid 5.6 billion, Warren's worth 53 billion, Berkshire 178 billion, giving Warren 29% ownership, if you have better numbers feel free to share). So he mentions 6 million dollars in taxes but omits 1.6 billion from the discussion.
This guy kills me. He's more than welcome to write a big check to the US government. Until he does, you'll all forgive me when I consider him somewhat less than sincere in his desire to see more of his income go to the IRS.
Buffet isn't this economically illiterate. The super rich must wish to hose the only sort of rich.
All of the comments here attacking Warren Buffett's authenticity, suggesting that he should put his money where his mouth is and write the Treasury a big fat check, are missing the whole point.
Services provided by the government are public goods. It's blindingly obvious that a single person cannot pay for those public goods. Just Buffett's own contributions, no matter how much he donates, will not be enough to solve our budget issue. It's called shared sacrifice because it's meaningless unless everyone participates.
It's like the neighborhood park (i.e. medicare/social security): Everyone wants one, but nobody wants to pay for it. In steps the neighborhood's rich kid (Buffett), who suggests that all the rich kids pitch in to pay for the park. If that happened, everyone would be made better off, but one kid alone isn't enough.
This is a very canonical problem of public services provisioning and funding. It's completely naive to sit back and suggest Buffett tackle the issue himself, because we all know that's ridiculous.
Open your eyes. The problem is not Buffett's to solve. But he recognizes that there is a problem.
Apologies for the harsh tone, but it baffles me how members of Hacker News can think so naively. The attacks on Buffett are utterly unfair and unjustified. We should all have an open mind and try to understand the proposal.
Services provided by the government are public goods. It's blindingly obvious that a single person cannot pay for those public goods. Just Buffett's own contributions, no matter how much he donates, will not be enough to solve our budget issue. It's called shared sacrifice because it's meaningless unless everyone participates.
It's like the neighborhood park (i.e. medicare/social security): Everyone wants one, but nobody wants to pay for it. In steps the neighborhood's rich kid (Buffett), who suggests that all the rich kids pitch in to pay for the park. If that happened, everyone would be made better off, but one kid alone isn't enough.
This is a very canonical problem of public services provisioning and funding. It's completely naive to sit back and suggest Buffett tackle the issue himself, because we all know that's ridiculous.
Open your eyes. The problem is not Buffett's to solve. But he recognizes that there is a problem.
Apologies for the harsh tone, but it baffles me how members of Hacker News can think so naively. The attacks on Buffett are utterly unfair and unjustified. We should all have an open mind and try to understand the proposal.
Who pays income taxes? The rich mostly.
http://ntu.org/tax-basics/who-pays-income-taxes.html
http://ntu.org/tax-basics/who-pays-income-taxes.html
Politics is rearing its ugly head again on HN. Flagged.
Notice that Warren Buffett is asking for tax increases on those who make more than $1M and $10M respectively. I'm fine with this. He seems to "get", unlike so many Democrats, that $250k/year is not rich.
Where I get nervous is all the Democrats who seem to think that there is no difference between $250k and $1M/year and up. I get kind of ill seeing obscenely wealthy Democrats in Congress, almost all making MUCH more $250k, trying to lump my household in with the rich. I'm willing to pay more, but not if these wealthy Democrats won't create a distinction between $250k/year, $1M/year, and $10+M/year.
Where I get nervous is all the Democrats who seem to think that there is no difference between $250k and $1M/year and up. I get kind of ill seeing obscenely wealthy Democrats in Congress, almost all making MUCH more $250k, trying to lump my household in with the rich. I'm willing to pay more, but not if these wealthy Democrats won't create a distinction between $250k/year, $1M/year, and $10+M/year.
Off topic: most articles about politics.
I'm a huge fan of Warren Buffet but in this case I think the math just doesn't seem right. I don't have the exact numbers, I took data from wikipedia and the NYT article, so, please, let me know if my math is way off.
From the article, there are about 200,000 people with income of $1M+. Let's make it $5M per person. That's 1 trillion USD combined income.
The rest of the taxpayers seem to be about 200,000,000 with an average income of about $25,000. Combined income = 5 trillion.
So, if they reduce the tax of the bottom group with 2%, as Mr. Buffet suggests, the tax of the upper bracket has to be hiked with 10% just to compensate. And if we add another 10%, just for the fun of it, that's 100 billion taken from the rich but it's still a measly part of the budget (around 3 trillion) not to mention the debt (15 trillion). And don't forget that people with 1M+ income have a vast number of legal and semi-legal tricks at their disposal to reduce their tax rate. The moment you increase the tax too much, you start seeing money flowing to offshore locations.
So, while "tax the rich more" and "let them share the burden" are great feel-good slogans, I don't think they offer any practical solution for the huge USA deficits.
From the article, there are about 200,000 people with income of $1M+. Let's make it $5M per person. That's 1 trillion USD combined income.
The rest of the taxpayers seem to be about 200,000,000 with an average income of about $25,000. Combined income = 5 trillion.
So, if they reduce the tax of the bottom group with 2%, as Mr. Buffet suggests, the tax of the upper bracket has to be hiked with 10% just to compensate. And if we add another 10%, just for the fun of it, that's 100 billion taken from the rich but it's still a measly part of the budget (around 3 trillion) not to mention the debt (15 trillion). And don't forget that people with 1M+ income have a vast number of legal and semi-legal tricks at their disposal to reduce their tax rate. The moment you increase the tax too much, you start seeing money flowing to offshore locations.
So, while "tax the rich more" and "let them share the burden" are great feel-good slogans, I don't think they offer any practical solution for the huge USA deficits.
I've learned something from Mr. Buffet.