Warren Buffet Isn't A Patriot

According to Joe Biden, paying taxes is patriotic. If that's the case, Warren Buffet and the rest of the liberal billionaires aren't patriots.

Buffet has said it's okay to raise taxes on the rich because he pays less of a percentage in taxes then his secretary.

But that's a choice. Buffett makes his money on Dividends and Capital Gains. He does so because that rate is 15%. He could pay himself a salary of $100,000,000, and allow himself to be taxed at the rate of 35%, but he chooses not to. He could also write a check to the Treasury each year to pay tax on 20, or 30, or 50% of his real income. Againg, he chooses not to.

So can we please dispense with the idea that Buffett is some kind if tax expert? If he pays a lesser percentage than anyone in his office, it's because be has the option of choosing how he will be paid.if you raise the Capital Gains tax to 80%, I can guarantee you he and the other progressive billionaires will start taking a salary.

Which, if you take Joe Biden at his word, means that Warren Buffet is not an American Patriot.

Comments

[John J.]

Good job mischaracterizing a quote.

First about the quote: America right now is in a war (two and a half to be exact). Our financial system is tanking and to save it the government is spending 700 billion (maybe in the trillions) to keep it from taking the rest of the economy with it. Yet the top 1% of the population, generally, wants to pay less in taxes to the point of hiding money overseas. Being willing to pay out of your excess to that which is allowing you such excess is, in my opinion, patriotic.

How Warren Buffet doesn't fit your straw man: He doesn't use any loopholes in tax law. He files only what the IRS tells him he has to file. Yes, he makes his money through capital gains and that is a lower rate than general income, but he doesn't try to hide his money and he doesn't ask for lower taxes; in fact, the opposite. He is also not cited as a tax genius, only as a financial genius -- which is evidenced by his success in the field.

As I have previously said about capital gains and Obama's tax plan, the plan isn't to raise it to 80%; not even to income tax parity at 35%. The plan is to raise it to (for the highest bracket) 20%, the same rate it was during Clinton's presidency and less than it was under Reagan or Bush I. Right now, it's at 15%, lower than the tax rate of any standard income bracket.

[Jim Durbin]

John,

As I pointed out - the US Treasury accepts donations 365 days a year. If Buffet thinks he's not paying enough in taxes, he can write a check at any time, or alter the way he pays himself.

His company could pay him a salary, which would mean he pays the top rate and SS/Medicare, but he chooses instead to use the Capital Gains method.

Smart? Yes. Paying his fair share? Not according to Obama/Biden.

My point was that if Obama did raise the cap gains to 80%, Buffet would not pay himself in that manner, putting the lie to his reasoning.

As for raising it to 20% - that affects me a lot more than Warren Buffet. It's strange that we listen to his advice or use him in debates when he has the excess to weather that extra 5% with no problem.

Buffet uses no tax loopholes? Right. I'm sure he fills out a 1040EZ at the HR Block and calls it a day.

[John J.]

From an interview with Warren Buffet: "Buffett said that was despite the fact that he was not trying to avoid paying higher taxes. “I don’t have a tax shelter,” he said." As far as filing a 1040EZ, I don't believe you can for capital gains. Don't straw man me.

Do you make $357,700+ annually in just capital gains? If not you don't have to worry about that increase. The 20% would be only for those in the top bracket, currently $357,700 and more. It also is ONLY on the income over that amount, the rest of your income is taxed at a lower rate. If you want to argue taxes, maybe you should learn how they are charged.

[Jim Durbin]

John,

Buffett could pay more in taxes, but chooses not to.

You're arguing that he would pay more, but he can't.

If he wanted to pay more in taxes, he could pay himself a salary from the profits of his corporation, instead of taking capital gain distributions.

The same way small businesses can choose to take salary, dividends, or corporate profits at the end of the year

My point is the story of Buffet complaining about it being unfair is a nice political trick, but it doesn't stand up to any scrutiny. Buffet could write a check right now to the Treasury for his entire fortune if he wanted to.

He does not. Instead, he sides with people who traditionally raise taxes on income earners who don't have the resources to shuffle money around.

I'm not saying Buffet is illegally hiding his income. I'm pointing out that if he thinks it is unfair, he can pay more than his secretary in the percentage of money he makes each year.

He does not. He follows the rules to maximize his tax benefits, as any smart businessman would.

[John J.]

Again, you continue to straw man what I have said. I have never said Buffet can't pay more. What I have cited him saying is that a tax system that taxes the top 1% of the population at a lower rate than anyone else is unfair. If we could reduce the tax rate of the other 99% below the 17% Buffet pays without ballooning the deficit, I'm pretty sure Buffet would support it. Because that is impossible, he believes that the tax system should be made more fair by raising tax rates on the top 1% and lowering it on the rest. Even if he overpaid on taxes, that wouldn't make the system itself any more fair.

[jim durbin]

The problem is that the attempt to raise taxes on the top 1%sways hits the producers instead of the super rich. If Buffett doesn't want to be taxed, it's very hard to actually get him. What you do end up doing is raising taxes on the people who are arbitrarily rich enough to meet dome fairness standard, but not wealthy enough to exercise those options.

And let's not leave out the massive welfare payments of the refundable tax credits. This is the very definiition of socialism, and the msjor weakness in democracy. A majority can vote to steal the property of aminority.
This isn't about roads, or education, or defense.

It's about the massive spending used to keep one party in power.

[John J.]

First, the top 1% does not include anyone that can't afford an extra couple percent tax. Second, if you make $250,000 a year, your taxes will increase by $0. If you make $300k, you will see an increase of $1,500. Don't tell me someone making six times what I make can't afford that, especially given the fact that this is what they were paying just 7 years ago.

I don't know how often I can say this, there are almost no small businesses filing as personal income $250,000 or more. 98% of small businesses (more than 32 million businesses using McCain's numbers) will see tax cuts. Even more small businesses that file as businesses will see even greater tax cuts through a number of programs.

You want to talk about massive welfare, lets talk about McCain's plan of giving multi-millionaire CEOs an average of $700,000. Or how about the estimated $4,000,000,000 that oil companies will get under his plan. Me, someone making just over median income, will get $300. And where is McCain planning on getting the money from? Even if he cut all the earmarks from here on out, that is less than $20 billion a year for his $300 billion in tax cuts. Factor in his other spending programs and your children and mine will be facing a 7.6 TRILLION dollar deficit increase ten years from now.

Don't try to say only Obama is trying to spread the wealth. At least if that were true he is spreading it to people who need it; people who haven't seen a real income pay raise in eight years. Even if your straw man dog whistle of "socialism" were true, I would take that over John McCain's flagrant corporate feudalism any day.

[John J.]

Actually, need to make a quick correction to those figures I gave you for $300,000. The $1,500 increase is correct, however, in 2000, that income was paying $13,000 more than they are now. So they will only lose 1% of that tax cut.

This is what you don't seem to understand about our tax system. As I described previously in another thread, someone in the highest or second highest tax bracket doesn't pay taxes on all of that income at that tax percent. If the bottom four tax brackets get a 5% drop, the people in the top two brackets get that cut too. However, if the top two brackets get massive cuts, as McCain proposes, the bottom 4 brackets, 95% of the country, don't see a dime.

[Jim Durbin]

John,

In 1992, Bill Clinton promised a middle class tax cut to get elected.

This the real dollar effect of the Clinton years versus the Bush ones to follow.

http://www.taxfoundation.org/blog/show/22958.html

There just aren't enough people to make up the gap between the super rich and the massive wealth transfer Obama advocates. They always have to bring it down to the middle class.

Obama's plan is a $60 billion yearly stimulus coming straight from the rich to the poor and middle class, conveniently not listed in the budget, because it's a refundable tax credit, not an expense.

Now, you may feel it's fair to continue to vote yourself money from those who make more than you, but that's the very definition of socialism. Socialists always say the rich can afford, "just a little more."

Reminds me of the people who always expect someone else to pick up the check because, "they can afford it."

The problem is that kind of thinking destroys the fabric of a society, just as easily as it does a friendship or family ties.

If you want more, figure out a way to make more. I know you and your wife are talented people. There's nothing holding you back from making $250,000 or $500,000 or more.

But to go to those who risk their families and make that money, isn't just foolhardy, it's a personal flaw that rots the foundation of a free society.

If you want money, figure out something that people to buy. Using the government to forcibly redistribute wealth because it's "fair" and "they can afford it" will always leave you wanting more.

How about we spend a little time focusing on cutting back on the massive growth of the government. Revenues are up - are they were for six years. If government would tighten its belt, they wouldn't have to keep coming to us for more.

What you'll find, is that you've replaced those evil, greedy rich people, with evil, greedy government bureaucrats, who aren't so easily dislodged.

[John J.]

I see you are ignoring my question about McCain's tax proposal.

You also are throwing out a lot of charges without understanding what is actually being proposed:

10% mortgage interest deduction. No details on how it ties in to current mortgage deduction. Reading it it sounds like an alternative to current system at a lower rate for those who don't itemize.

No taxes for seniors making $50k or less. It doesn't make sense to me to pay taxes on soc security benefits or 401k income which is what most senior in this bracket live on.

Expand EITC, something McCain is also proposing.

The rest of his proposals are all encouragement deductions. They are used to encourage behavior that will improve the country, either through college education, green energy use, retirement savings, etc. This is the same tack McCain uses in his health care proposal.

Then we get to the part of his plan that gets all the headlines. Until 2010, people paying taxes are paying at an artificially low level. If nothing is done, everyone will see taxes go up 2% or more. Under Obama, rather than hitting everyone with that, he will limit it to only those making more than $250,000. He is doing that because, unlike George W. Bush or John McCain, he realizes that tax cuts need to be paid by someone, either people today or our children tomorrow. Tax cuts are always about moving the wealth, it's just from where to where. McCain believes that you and I should pay more (relatively) so that the upper 1% of the population can pay $700,000 less and that our children can foot the bill when the time comes.

You also need to look at the economic theory behind the two tax plans. McCain, contrary to all evidence, believes that giving tax cuts to the rich will create more cash flow. It has been shown, especially in the past 8 years, that the top 1% will save tax cuts and the money won't flow into the larger economy. However, Obama believes that if you give money to people who are living paycheck to paycheck, the money will make it back into the larger system quickly. Rather than avoiding buying new widgets, more people will be able to afford them. If more people can afford to buy things, more things will be bought. Taken to fruition, this means that incomes for producers will go up and the money will continue to climb the economic ladder. Thus, even though the taxes will increase on the top 1%, their incomes will increase by a commensurate amount. This is one of the most basic theories of economics.

You also keep bringing small businesses in and try to claim that Obama wants to punish them. If you read his tax plan, and compare them to McCain's, you will see that small businesses, as classified by the SBA will see much larger tax breaks and incentives under Obama. McCain's tax proposals largely target the top 1%. You will not see a $700,000 tax break that the average Fortune 500 CEO will. You will not see the $4 billion dollars that oil companies are going to get under McCain's tax breaks. But under Obama's plan, you will get a 0% capital gains tax rate as a small business. You will get a 50% tax benefit on your employee's health care premiums. Neither of these things are you going to see offered by a McCain administration unless you are a large corporation or make a million dollars. If you actually read McCain's economic proposals you will see there is not one line item that will aid small businesses like yours.

As for economic mobility, if it were as easy as you try to make it out to be: more than 5% of the country would be making more than $250k, fewer than 90% of small businesses would fail and more than 1% of small businesses would be making more than $250,000 annually. Most businesses don't turn a profit until four to ten years after their establishment.

Remember, you didn't get where you are living in a vacuum. You make the money because of the things in your life that were put there by luck or by society. Those who make more have gotten more from society, either directly or indirectly. Because of this, those who make more owe more to the society that has put them there.

[Kill The New Ruskin Fence]

And on the more local front. Our Heart Land Bridge to Nowhere at my former high school [Ruskin KCMO]. Mayor Funk and John [Not So] Sharp have teamed up with Bettyanne Mims and the Hickman's Mill school district to squander OVER A QUARTER OF A MILLION DOLLARS on a new, unneeded, unimproved artsy fartsy ART FENCE.

The current serviceble perimeter barrier not fancy enough for you or the zipping traffic dashing to their next destination on Blue Ridge Extension. For Pennies on the Dollar, the after hours dentention students can drop climbing vine seeds at the base of the present fence. More fancy? Have those same students slip in wooden slats in the chain link!

There are two things I am totally ashamed of in the Mid West. Federal Felon and U of Misery alum [and my fellow classmate] former congress member Randal 'Puke' Cunningham. And the New Ruskin Fence.

If Warren Buffet paid every penny for the new boon doggle in Jackson County, it would be merely sad. With tax payer funding it is fodder for Leno and Letterman, and rightly so.

donlake@ymail.com

619.420.0209