The article today in the New York Times where Warren Buffet laments that he just gets off so easily at tax times is one of those hinkey pieces that establishes two premises that are, in fact, nonsense.
Premise one is the rich are not paying their fair share. IRS statistics consistently tell us that it is the bottom 50% who aren’t paying any share and the so-called rich pay the lion’s share. Buffet at least tries to push it toward “super-rich”, whatever that means. However, it is just another version of the class warfare argument the left has been trying for years. Bill Clinton has stood up and said “why aren’t they taxing people like me more?” Barack Obama has done the same.
Here’s what Buffet is pitching:
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.
Buffet first goes right to the class aspect of it in the most emotional manner possible. The implication, of course, is that the rich aren’t fighting … they don’t have too. Obviously then the “poor and middle class” must. They couldn’t do it for reasons other than they must, I guess.
And, of course, the other other narrative is that 15% is a “bargain” tax rate. He attempts to make the point that the super-rich don’t do much work to earn their money. Well here’s a clue for Mr. Buffet – the government doesn’t work at all for the 15% it takes.
Premise two is that if they’d just tax the rich more, all of our revenue problems would be over. The fact is that’s not even close and a money man like Buffet knows that. What it would do, though, is help dry up any revenue that is now being gotten from investments as the rich seek other ways to invest and protect their income. Again, this should be Econ 101 stuff for a guy like Buffet.
The government could tax the rich 100% next year and still have to borrow money. But we know, given human nature, that there’d be no 2nd year at 100% because those with that sort of money would have found ways to protect it by then. Meanwhile, the economy would be in reverse.
Finally, Buffet says:
I know well many of the mega-rich and, by and large, they are very decent people. They love America and appreciate the opportunity this country has given them. Many have joined the Giving Pledge, promising to give most of their wealth to philanthropy. Most wouldn’t mind being told to pay more in taxes as well, particularly when so many of their fellow citizens are truly suffering.
Would someone who has Warren Buffet’s email please apprise him of the fact that a) he doesn’t speak for all the “rich” so he ought to confine his appeal to only himself and b) if he’s really serious about this, he doesn’t have to wait to have the government increase his taxes, he can voluntarily contribute any amount he wishes to the US Treasury to help pay down the debt or help their “fellow citizens” who are “truly suffering”.
Of course he do everyone a much greater favor if he’d take that money and instead invest in a business that’s got promise so they can expand and hire people. Dollar for dollar that would do everyone more good than appealing to government to raise tax rates on those who actually do have the option of what I described.
But, of course, that doesn’t fit the liberal narrative and the one thing those like Buffet and George Soros have reliably done for some time is push that narrative.
I‘m still amazed that many people who put their support behind Obama in the presidential election, are suddenly discovering things about him they don’t like.
Really? Now they discover Obama is a class warrior? It comes as no surprise for those of us who took the time to assess where he came from and what (little) he’d done.
Suddenly, the rich are concerned that the guy they backed may not be what they hoped he was (notice that’s the correct context in which “hope” should be used when “hope and change” is spoken):
Some of Barack Obama’s richest supporters fear they have elected a “class warrior” to the White House, who will turn America’s freewheeling capitalism into a more regulated European system
Ya think? What was your first clue – his remarks about “spreading the wealth” to Joe the Plumber or the thousands of other things he said which might imply such a tendency?
And as an aside, America’s capitalism is about as “freewheeling” as a modern waterslide is “death defying”.
Chris Edwards of the Cato Institute, a free enterprise think tank, said Democrats in Congress were unnerved by the president’s latest plan to raise $210 billion over 10 years from multinational corporations.
The money is needed to pay for a national debt that will double over the next five years; and triple over the next 10 years to $17.3 trillion. But the crackdown already faces fierce Democratic resistance.
“These big companies are based in New York Boston, Seattle and Silicon Valley, where Democrats dominate,” Mr Edwards said. “Obama’s tax plan is already cleaving him from his big corporate supporters,” he said.
The good news in this, of course, is that Congress has to pass the legislation that enables this, and per Edwards, they’re getting cold feet. The reason is also obvious – any “cleaving” of Obama from “big corporate sponsors” also means the rest of the Democrats suffer the same fate.
The level of taxation necessary to pay for the profligate spending now taking place will have to be massive as anyone with a 5th grade education understands. But the Dems also understand that any taxation that takes place must be other than income taxes because it is important to maintain the mirage that “95% of all Americans” are getting tax cuts. That leaves “the rich”, corporations and smoke and mirrors.
The rich have been identified ($250k or more), corporations are on the block with much higher taxation in the offing. So the investor class and the engine of the economy are under assault. The smoke and mirrors show? Wait until health care and cap and tax trade hit. 100% of Americans will be paying large sums for both.
But back to the point – the deeper we get into the Obama administration, the more we come to understand how gullible a good portion of the American public appears to be. There is a certain level of satisfaction with the buyer’s remorse being seen among many of his supporters as they see what their vote has actually bought. I sure hope they don’t shop for other important items as badly as they apparently shop for presidents.