…and his fiscal innumeracy. But he supports Barack Obama, so that’s OK.
[Update a while later]
The statistic I would like to see is the amount of tax paid relative to consumption. By that measure, it is possible that Buffett’s tax rate was more than 100 percent.
I do not care if he pays very little tax on saving. I would rather he pay zero tax on saving. His taxes are too high, not too low.
That doesn’t fit the narrative.
Was there supposed to be a link?
OK. It’s there now.
So a self-made multi-billionaire suffers from “fiscal innumeracy?” To take the issues pointed out in the article in the same numerical order:
1) Arguing double taxation when firms like GE make a profit and pay no taxes is rather innumerant.
2) What Buffet is saying about payroll taxes is that they disporportionally affect lower and middle income people. You could increase the top tax rate greatly to get the same proportional effect.
3) Buffet isn’t ignoring the death tax – he’s stated his plan to spend his estate in charitable giving before he dies.
Warren Buffet may be a smart investor, but economically and politically he’s a fool.
If Buffet believes he is paying too little for taxes, all he has to do is write a check. The US government is more than happy to accept donations over and above what we owe in taxes. The fact that he doesn’t write the check says a lot.
There’s also this from Forbes:
Still, Mr. Buffett is not sharing the real reason that he doesn’t pay much in the way of income tax relative to his great fortune. The secret is hidden in plain sight. Mr. Worstall alludes to it when he mentions that Berkshire Hathaway does not in fact pay dividends. Mr. Buffett’s secret which you can find blasted all over the Internet is one of his famous quotations:
Our favorite holding period is forever
You only pay income taxes at any rate on realized appreciation. An investment with a holding period of forever incurs a capital gains tax of 0%, while all along the holder can be getting wealthy from appreciation. That’s the real reason Mr. Buffett does not pay a lot of income taxes.
There’s also this article about why Buffet likes the estate tax:
Did you know that the life insurance lobby is actively lobbying to restore the estate tax?
Why would the life insurance industry care about that? It turns out that ten percent of life insurance industry revenue is related to the estate tax. Wealthy people take out life insurance in order to reduce estate taxes because when you die, your life insurance payout doesn’t count as part of your estate.
Did you know that Warren Buffett owns six life insurance companies? Did you know he supports the estate tax? You do now.
Like I’ve said before, horrible public policy positions, especially economic ones, are a form of conspicuous consumption: Buffet’s situation will never change under any tax rate. If you argue for low taxes, then clearly you’re one of the hoi polloi, a hayseed grunt in flyover country who works for a living and gets a, le sigh, W2 every year: for you simpletons, ±5% actually means ±5%.
I’d rather pay the world’s best investor, industrialist and philanthropist – Warren Buffett – than pay taxes. Can we set that up?
No, the people who think he’s got anybody’s best interests at heart but his own, are fools.
The man defends the death tax because its repeal would hit him in the wallet.
If by “his own [interests]” you mean turning the US into yet another Social Democracy, then yes. He doesn’t make any secret of it.
Link
Prof. Jacobson, on fire, rips whatshisface a new one.
If Buffet believes he is paying too little for taxes, all he has to do is write a check.
Remember that Buffet turned over a huge portion of his wealth to the Bill and Melinda Gates Foundation.
There, of course, it will be used for the public good. Like paying for the new $500-million luxury campus for the Foundation’s 1500 employees, because every nonprofit worker needs a $333,000 office. Especially at a Foundation focused on “extreme poverty.”
By spending his money in this manner, Buffet avoids the estate taxes which he says are too low.
Rather than pointing out the trivialities of the Bill and Melinda Gates Foundation, why not mention their continuing efforts at population control – including mass sterilization? Put pointing out supposed extravagances, you’re just supporting the redistribution of wealth cause.
I wish we could help him, I really do.
But that flipping restriction on “Bills of Attainder” in the Constitution makes it unlikely.
Now can he just go back to being senile in peace, please?
hmm.. how did “By” turn into “Put” in that post. Odd.
I made this promise to Warren Buffet, and I’ll make it to you; not a single penny I receive in donations will go towards government paperwork. Some will go towards private paperwork, but only the minimum necessary to keep track of my accounts with my optometrist, dentists, Apple Store etc.
So if Warren Buffet is feeling guilty about his vast wealth, I’ll do my small part in helping him assuage his guilt in my own small way.
“1) Arguing double taxation when firms like GE make a profit and pay no taxes is rather innumerant.”
Obamas Job Czar’s company didn’t pay any taxes? Crazy.
“2) What Buffet is saying about payroll taxes is that they disporportionally affect lower and middle income people. You could increase the top tax rate greatly to get the same proportional effect”
The links had a nice response to that.
“3) Buffet isn’t ignoring the death tax – he’s stated his plan to spend his estate in charitable giving before he dies.”
Hmm, Buffet thinks that giving to charities is a better way to use his money that giving it to the government? When is he going to join the Tea Party?
So a self-made multi-billionaire suffers from “fiscal innumeracy?”
This doesn’t happen too often, so pay attention Chris… I’m about to agree with you and disagree with Rand.
Warren Buffet may be a smart investor, but economically and politically he’s a fool.
No, what he is is a liar and puts his own interest above that of the country. The point is being missed here for all the smoke and mirrors. Thomas Sowell states it very clearly, but I’m going to put it in my own words here.
The reason a rich person says, “Tax the rich” is because it’s not at all about taxing the rich. They are talking about taxing the people that are trying to join the ranks of the rich. Taxing income vs. taxing assets.
This is typical word games by the left. In this case they are very good at distraction from the actual issue.
People are not classes of people. They are born naked. They work. If all goes well, they retire with lots of wealth. That wealth is invested which makes capitalism work. These are all good things.
ken, you almost made it clear.. but I don’t think you used small enough words. Warren Buffett is *guilty* about being rich and being good at staying rich. He not only wants to pay for being guilty, he wants everyone else to share his guilt. He believes in “eliminating classes” and making everyone “equal”. Not equal protection under the law.. although that’s great. Not equal opportunity or access to health care or education.. although he certainly wants that. Equal.. economically. Everyone gets paid the same, no matter what job they do.. no matter how easy or hard or how many other people want or could do that job. Sure, there’ll be pay grades but it’ll all be published and you’ll know how much everyone earns. You’ll be able to buy whatever you want, but of course those prices will be fixed and you won’t have all that unnecessary competition. You don’t *need* 400 different types of breakfast cereal.. after all, everyone likes Cheerios.
A few years ago I was chided in a Brad DeLong thread for using the allegedly shrill phrase phrase “death tax.” I countered that “death tax” simply names the tax for the activity being taxed.
Lookie here – I found the thread. I stated: “People have to die in order for the tax to be collected, so the phrase ‘Death Tax’ is highly accurate.” Commenter Roger Bigod called it “totally inaccurate,” but didn’t really give a rationale.
I don’t think you used small enough words.
Using all four letter words just doesn’t work for me. I’m not like that guy at Ace of Spades HQ ya know. Which reminds me to see what he’s up to these day (gotta get links on my new blog.)
ken anthony – People are born naked, true. Born equal? Don’t make me laugh.
Bush Jr, Kennedy, Paris Hilton and the Duke of Westminster – all started out in (at least adult) life with huge amounts of wealth they didn’t do a damned thing to get. At least one of them has never done a lick of real work and never will, and I’m sure we can all think of others like that. But all of them will “retire” with a great deal of money.
There’s a great scene in Zeffirelli’s Hamlet where, in act III, the honest blame is laid at the feet of the usurper king, and the king literally brushes aside the accusation with a broad sweep of his hand, but having no rebuttal, his guilt is obvious to all.
That’s what non-responses (Ayn Rand called them “blankouts”) like that always remind me of.
Born equal?
Yes, I do attempt to choose my words carefully (it’s a sugar thang… you may have to consider more than one step to get there. I really do try to keep my comments short.) I did not say born equal, but did say born naked. Both what I said and what I omitted are important.
You can’t really tell whether those with advantages or disadvantages will turn out better. The important thing is anytime you fit anybody into a static class it generally means you are ignoring the dynamic nature of things.
Leftards do that a lot. An extreme lot.
Oh, Think we are all born equal.
I’d rather be born smart and poor than be Paris Hilton! I have a chance at life. She never had a chance! She swims at the shallow end of the gene pool. She may actually be standing on the lowest step BEFORE entering the pool.
And when the Zombie Apocalypse comes Paris will get completely robbed by her closest “friends” in the first 15 minutes. And she’s not smart enough to riot at the Wal-Mart, stealing for the future. She is, obviously however, NEVER in danger of actually being attacked by a true, old school, zombie.
They eat brains, remember?
Warren Buffet may have already been attacked by a zombie with a Dremel and a straw! At least, that’s how he sounds on this one.
ken – “They are talking about taxing the people that are trying to join the ranks of the rich. Taxing income vs. taxing assets.”
Excellent insight.
On a different note, the key thing to Buffett’s plaint is that he is essentially bemoaning the regressive nature of Social Security taxes. For years, the Democrats insisted that Social Security is NOT welfare, because the recipients are only getting back what they paid in,
It seems they are ready now to drop the charade: there never was, never could be, a “Trust Fund” or a “Lockbox”. It’s a generic Ponzi scheme, and if you got in on the ground floor, you made out like a bandit.
Now that the pyramid is inverted and the constituency so large and dependent, they can come clean and admit what those with half a brain knew all along: Social Security is Welfare as we always knew it. And, there’s not a damned thing you can do about it.
you’re just supporting the redistribution of wealth cause.
Redistribution is a red herring. Everyone’s wealth gets redistributed, sooner or later. The only questions are how it is redistributed and who decides.
I couldn’t care less how Buffett redistributes his wealth, or to whom.
The problem is that he wants to decide how *his* wealth will be redistributed, but he wants to prevent others from deciding what will happen to *their* wealth.
Contrary to Buffett, the people affected most by tax increases will not be billionaires who can afford to set up things like private foundations.
This is a typical elitist double-standard.
Another real-life “Orren Boyle” or “Jim Taggart.” And people say Ayn Rand’s novels weren’t realistic!