Buffett opines on the Buffett rule
Buffett isn’t so sure he likes the Buffett rule, although he’s still sure he likes Obama. Nor is he all that certain that he knows how Obama plans to define it.
This is the Buffett rule as Buffett now says he would like to see it:
[Buffett] noted he was describing a very limited number of wealthy Americans who earn the majority of their income through capital gains, which is taxed at a 15 percent rate.
“What I’m talking about would not apply to someone that made $5 million a year as a baseball player or $10 million a year on media,” Buffett said on Fox Business Network. “It would apply only to probably 50,000 people out of 309 million who have huge incomes, pay very low taxes. There should be a policy that applies to people with money who earn lots of money and pay very low rates. If they earn it by normal jobs what I say would not hit them at all.”
Going back to Buffett’s NY Times op-ed that started all the commotion, I think he’s rewriting history about the scope of his suggestions. After all, his piece ended with these thoughts, which appear to apply not just to capital gains but to regular income as well:
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.
My friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice.
[NOTE: I wrote about Buffett’s original Times article here.]
I don’t understand it. People who want to give more should give more. Why do they feel better about creating law so that others have to give more along with them? I am certainly not in that class of wealth, but I’ve met many wealthy people through my job (own-your-own-golf-course level wealth) and frankly, there are many more of them that are decent, salt-of-the-earth types than not. Many more.
And I have nothing against them because of their wealth, nor do I think that they are not paying their “fair share.”
On the contrary, we producers are paying more than our fair share to cover those of us who are less fortunate/lazy. And we do this, so that the less fortunate can have a shot at prosperity beyond their current means. We actually put up with funding the lazy, to help the others.
If Buffet wants to write a check, he can write a damned check. He should leave others alone.
Why do they feel better about creating law so that others have to give more along with them?
Whatever they lose out in money, they gain back 10 fold through power and inside intel.
The super rich aren’t the super rich because of the low taxes they pay. The super rich are rich because they taught their children how to make money and how to treat making money as a game, where you win some and you lose some. They also provide knowledge on international banks and other stuff the “poor” class have no idea about. It’s kind of hard to tax capital gains when the bank account associated with it is in a foreign country that is not required by any law to report any transaction to the US feds.
For example, there’s a strategy of creating your own private bank, so that your children inherit 100% with zero death taxes. Death taxes only apply to the middle class and the poor, people who were never informed of the money making strategies of the hyper rich classes.
You create your own bank. You put your money in, where the feds can’t touch it. And then you start loaning out money and making money with other people’s money.
People like Soros made money when the currencies of nations collapsed. You ever wonder how that happened?
Check back during the Great Depression and you might notice that the number of millionaires made there was greater than any other time in American history. How is that possible when most everyone else was out of work and starving? Because it was a “wealth transfer”. People got rich because the money dried up at the bottom and flowed back to the top: the top that knew what was going on and how to take advantage of it.
So people like Soros has strategies that allow them to make money, by multipliers like 2X, 4X, 6X, 10X, or even 100X, simply by taking advantage of a currency fluctuation due to political or economic upheaval. When a nation is printing out more fiat currency, Soros invests in gold and silver and other stuff that is immune to inflation or monetization of debt. Then when the nation “recovers”, Soros buys back into the national currency and uses the huge exchange rate to buy up real estate that is worth hundreds of millions, for perhaps as little as 500,000 USD.
That’s how someone evil like Soros made his money. He just simply transfered it to his hands, from everyone else. Just like he did with the Jews back when he was working for the Nazis. Converting jewelry and precious metals and other things into cash and back again. He probably had his own personal stash and metals reserve, and when Germany hit hyper inflation, it was a great time to buy real estate because people were selling them for nothing. 20 years later, that same real estate is now worth mega millions.
Warren Buffet is what white guilt looks like with an obscene ability to asuage it.
All I need to know about this is that he doesn’t even pay the taxes he owes, so he is simply not honest in his proposal.
http://www.newsmax.com/Headline/buffett-irs-back-taxes/2011/09/01/id/409520
Meanwhile, Berkshire Hathaway just announced that they are going to use a good amount of their cash to have a stock buyback. Now, why would they do a stock buyback instead of distributing the money to shareholders in a dividend?
Because with a dividend, shareholders would have to pay taxes on it, immediately, as ordinary income. But, as a stock buyback, the shareholders get the money as capital gains on their stock, thereby giving them the lower rate … AND, they don’t have to pay taxes on those capital gains until they actually sell the stock – perhaps many years into the future.
Now, I have no problems with companies doing this, as it is their fiduciary responsibility to their shareholders to allow them the lowest tax rates possible (and longest time until taxation) on the Berkshire profits, but Berkshire is a company whose despicable, lying scumbag CEO is running all over the airwaves screaming about how people who take capital gains (instead of ordinary income) are terrible people who should be flogged in the public square – though the despicable Buffett mever paid himself more than $100,000 in actual “income” for any year.
I can only hope that Buffet is accurately recorded in history as a self-hating, despicable, illusory guilt-ridden leftist who, at the end of his miserable life, did everything he could to force on America the only real America-hater who has ever occupied the White House … and who was ineligible (as a dual/multi- citizen) as well … and who was, without any question, at all, the most inept, incompetent, insane person that America has ever seen in high public office – any high public office.
Buffet has decided to spend the end of his pathetic life working as hard as he can against America. Let history record that, as that is his true legacy – especially after credit crisis 2.0 comes and Berkshire goes belly up (selling puts will do that to you).
DArrell,
You are correct. He is simply not honest. I have dubbed him “The Fraud of Omaha.” Clearly, the simple solution is to sa “Mr. Buffet, write a check to the IRS.” Don’t hold your breath.
Furthermore, he supports continued double taxation of dividends(??!!). For those who don’t realize it, dividends are taxed as corporate profits and then again at the individual level when they are distributed to stockholders; it’s not unlike being forced to pay into social security and then paying income tax on a portion (50% or 85%) of that money again when you receive it.
When people like Buffet and Soros support higher taxes and redistribution of wealth it should always raise an eyebrow an dhold on to your wallet or purse. As you point out, (the Kennedy fortune is a case in point) it’s never their tax payments that go up or their wealth that’s redistributed.
Progressoverpeace,
You missed one point. Stock buybacks also consolidate power in the hands of the largest shareholders by reducing the number of smaller outstanding shareholders (or at least the size of their stake in the corporation).
All these corrupt robber barons and their political pays should just go to the execution scaffold so we can start the process all over again with new elections and new business competitors with real integrity.
imagine the swish back and forth if there was no way to record and play back what happened… then whatever lie to explain things would put stuff into he said she said, instead, you get playback…
Mr. Buffet is a member of the exclusive Got Mine Club. At a certain point all members of the club turn from productive pursuits to the task of limiting further membership. They know they have more than they could ever spend so they work to limit the ability of others to be as successful. That’s why so many of the very rich suddenly discover the charms of socialism.
Wm Lawrence,
I do think you’ve hit the nail on the head. The fact that it was Leonid Breshnev who had an antique auto collection and not the average schlub soviet citizen is NOT a coincidence; and that was in a society of “from each according to his ability, to each according to his needs.”
Finally, a reporters on video asks Buffett why he doesn’t just send a big check to the government. Starts at the 4:20 mark:
http://bloom.bg/oxfScN#ooid=w5bDJ2MjqFxu5g4sOrUtKzC9nh1xfabN
BTW, McConnell never said relying on volunatary payments to the Treasury is the way to solve a trillion dollar deficit problem. McConnell simply said if Buffett wants to pay more in taxes, send in the check. He not once said that was the way to solve the deficit.
Buffett is lying. Typical Democrat.
Did you catch this remark in the video on the B-H buyback? He says that “we announced our intent” and the stock took an immediate (~8%) jump, so the buyback ain’t gonna happen anytime soon. He goosed the value of his 30% of B-H by 8% with a little publicity gimmick, misleading and self-serving to put it charitably.
Meanwhile, Buffett also avers that ten-second profitable trades are taxable as longterm cap. gains. He lies as quickly as Hussein.
Thanks for the link, Scott.
Unlike most here, I have a great deal of admiration for Warren Buffett. He and I are about the same age and I invested a small amount in B-H many years ago. That investment, though I no longer hold it, was a very good one. Buffett’s annual letter to shareholders was almost worth being a shareholder. It was, and still is, filled with wisdom about long term investing.
I view Buffett as a man who has spent his life doing something that he enjoyed very much – identifying value in companies that were selling at fire sale prices, buying them, then holding and nurturing them over a long period of time. He is amazed at his long term success and I think he looks back with a some guilt and wonders why he was so blessed. I don’t know much about Buffett’s long term political views, but to me he has seemed mostly agnostic over the years. His friendship of some 20 years or so with Bill Gates has, I think, shaped his views toward the liberal idea about “giving back.” Warren Buffett has, through his company and investment activities, created many many jobs and made his investors better off. IMO, he and Gates can best give back to society by doing more of what they do best – shepherding companies into profitability and creating jobs, not paying more taxes so politicians can waste them. However, Gates is influenced by the very liberal population of Seattle. King County, where he lives, is probably as left leaning as any place in the country. They just held a $35,000 a plate fund raiser for Obama. Gates’ father is a long time liberal democrat who has influenced both his son and Buffett in their political thinking.
It doesn’t make sense that Buffett and Gates cannot see that raising taxes has never resulted in less spending or solving the deficit issues. But then I don’t travel in those ultra liberal circles so am not influenced the way they are. It’s too bad he has decided to champion Obama’s the tax the rich program. His expertise is investing, not tax policy. He’s just making a bit of a fool of himself.
Buffet has enough money to be made king of fools. The rest of America, however, does not.
JJ formerly . . .,
I don’t disagree. I admire what Buffet has done as a businessman. It’s when he begins to insert his political opinions in the national dialogue and uses his fame to do that (or use that fame ot manipulate a market) is when I condemn him as a fraud. It’s like saying that I’ve enjoyed watching Danny Glover in Lethal Weapon, Predator II and Lonesome Dove, but to use the megaphone of his fame to promote his insane political views makes him a dunce.
Once called ‘Oracle of Omaha’, has now turned into ‘Senile of Omaha’ and a mouth piece for Obama’s Socialism.
Pingback:The Libertarian: Buffett's waffling baffling