NYTIMES: Warren Buffett - 'Stop Coddling the Super-Rich'

[Henry]

This reminds me of the thread about Perry taking stimulus money after railing against the stimulus program.

http://www.extremeskins.com/showthread.php?343542-This-Is-Why-I-Wish-Politicians-Would-Be-More-Honest

[zoony]

The more I hear out of Warren Buffett, the more I like him.

I loved the blasting he did of S&P when they downgraded- it was spot on.

[Henry]

I am honestly staggered that so many people believe the government (who has no risk here) is owed 50% of what a person makes simply because they were sucessful.

Also, nobody is saying 50%. Buffett is pointing out that a large amount, if not the largest amount, of wealth generation for the super-rich (capital gains) is taxed at 15%. That's less than I pay. That's substantially less than an individual making $34,000 a year in wages pays. And that doesn't even take into account payroll taxes. Why should we be paying a higher rate than some guy who made $10 million in investments?

[Koolblue13]

Fair tax, flat tax, consumption tax. Give us one of those already and be done with the bull****.

[armstrong001]

There is a problem of spending. There is a problem of deficits. There is a problem of taxation.

Which "this" problem are you talking about?

Too much spending = defecits. This is the problem. Even the year we had the highest gross tax reciepts ever (2007) the Government brought in $1.163 Trillion in personal income tax and $2.568 Trillion total. Current spending this year is around $3.6 Trillion. How is this a problem of taxation when our current rate of spending is almost 40% above the highest recorded tax reciepts ever?

Not because they were successful but in Order to form a more perfect Union, establish Justice, insure domestic Tranquility, provide for the common defence, promote the general Welfare, and secure the Blessings of Liberty to ourselves and our Posterity.

The idiotic part is thinking that somebody who advocates for a tax reform should go ahead and pay whatever he would be paying under his proposed tax reform.

So, if it promoted the general welfare, you believe the government should be able to tax everyone at 100%? I don't understand how it's idiotic to do what you think is right. If he actually believes he should be paying closer to 50%, and that is the right thing to do, then he shouldn't wait for the government to coerce him to do it.

[Elessar78]

To the posters talking about "government programs" I think there are only three government programs that comprise the vast majority of federal spending: medicare, medicaid, defense spending. Every other gov't program is a drop in the bucket compared to these three. Reforming the other 99.9% of gov't programs won't move the needle if nothing is done about these three.

[armstrong001]

Also, nobody is saying 50%. Buffett is pointing out that a large amount, if not the largest amount, of wealth generation for the super-rich (capital gains) is taxed at 15%. That's less than I pay. That's substantially less than an individual making $34,000 a year in wages pays. And that doesn't even take into account payroll taxes. Why should we be paying a higher rate than some guy who made $10 million in investments?

Because you aren't paying anywhere close to $1.5 million in taxes (15% of $10 million)

---------- Post added August-15th-2011 at 10:21 AM ----------

This reminds me of the thread about Perry taking stimulus money after railing against the stimulus program.

http://www.extremeskins.com/showthread.php?343542-This-Is-Why-I-Wish-Politicians-Would-Be-More-Honest

I completely agree. If you are going to rail against it, don't take it.

[Henry]

So, if it promoted the general welfare, you believe the government should be able to tax everyone at 100%?.

In 1944 the top tax bracket rose to 94%. It's not unprecedented to raise taxes to help the government work through a crisis, especially a war, two of which we are currently fighting. It is rather unprecedented, however, to LOWER taxes and fight a war (or two.) That's how huge deficits happen.

I don't understand how it's idiotic to do what you think is right. If he actually believes he should be paying closer to 50%, and that is the right thing to do, then he shouldn't wait for the government to coerce him to do it

What does he pay? Does anyone here actually know?

---------- Post added August-15th-2011 at 12:27 PM ----------

Because you aren't paying anywhere close to $1.5 million in taxes (15% of $10 million)

So you think it's fair that someone making $10 million pays a LOWER rate than someone making $34,000? Really?

[BRAVEONAWARPATH]

Its obvious that Mr. Buffet is a socialist.....

[Destino]

Reading that makes it easy to understand how taxes are aiding the wealth gap. The tax burden lands squarely on those working. Sadly we get caught up in "top 2%" which allows people to focus on those making hundreds of thousands instead of millions. It turns the discussion away from the financial services industry (that has it's hands on every economic disaster of my life time) and onto business owners that are doing well.

Washington is bought and paid for and part of that budget clearly went towards propaganda campaigns. People think low tax rates are traditional, when they are not. People think taxing the rich destroys job creation when this country became great under extremely different tax codes then those seen today. Sadly money is now speech in the US and media (which costs money) is key to winning elections so I don't expect anything to change.

[Madison Redskin]

Because you aren't paying anywhere close to $1.5 million in taxes (15% of $10 million).

Am I to understand that you would support a regressive income tax regimen, i.e., one in which high-income families pay a lower rate than low-income families? If so, wow. Not even the Tea Party "flat-taxers" go that far.

[armstrong001]

In 1944 the top tax bracket rose to 94%. It's not unprecedented to raise taxes to help the government work through a crisis, especially a war, two of which we are currently fighting. It is rather unprecedented, however, to LOWER taxes and fight a war (or two.) That's how huge deficits happen.

And you're ok with taxing up to 94%? That's just going to have to be a point where I respectfully disagree with you. Gross tax reciepts actually went up every year from 2003 to 2007, even with a whopping 3.6% drop in the top rate (38.6% to 35% in 2003). It's just that spending went overboard. Spending is the problem.

What does he pay? Does anyone here actually know?

According to his article, just under $7 million in taxes.

So you think it's fair that someone making $10 million pays a LOWER rate than someone making $34,000? Really?

Yes. Because the person making $10 million is paying $1.5 million while the one making $34,000 is only paying $4,675 (actually only 13.75%) The government is making 320 times more money off the $10 million than the $34,000.

---------- Post added August-15th-2011 at 10:52 AM ----------

Am I to understand that you would support a regressive income tax regimen, i.e., one in which high-income families pay a lower rate than low-income families? If so, wow. Not even the Tea Party "flat-taxers" go that far.

No, I'd rather see the rate stay the same across the board, but I have no problem with 15% of capital gains money going to taxes, especially since you have to have your assets at risk for over a year to achieve that rate. If less than a year, it's a 35% rate. Are you willing to put your hard earned money in the stock market for a year just to get a lower tax rate?

[Madison Redskin]

And you're ok with taxing up to 94%? That's just going to have to be a point where I respectfully disagree with you. Gross tax reciepts actually went up every year from 2003 to 2007, even with a whopping 3.6% drop in the top rate (38.6% to 35% in 2003). It's just that spending went overboard. Spending is the problem.

The deficit and debt are a function of TWO things: (1) government expenditures; and (2) tax revenue. The American public wants to eat its cake and have it too. They lobby for more services AND lower taxes. That's the problem ... not just spending.

You're essentially arguing, "The problem is spending exceeds revenue!" Flip that coin over and you'll find, "The problem is revenue is lagging behind spending!"

No, I'd rather see the rate stay the same across the board, but I have no problem with 15% of capital gains money going to taxes, especially since you have to have your assets at risk for over a year to achieve that rate. If less than a year, it's a 35% rate. Are you willing to put your hard earned money in the stock market for a year just to get a lower tax rate?

You're not in favor of a regressive tax, but you support the status quo. Buffet's point was that the status quo is regressive insofar as the uber-rich pay a lower rate than the middle class. So, you're against regressive taxes, but you're for them?

[Mad Mike]

Too much spending = defecits. This is the problem. Even the year we had the highest gross tax reciepts ever (2007) the Government brought in $1.163 Trillion in personal income tax and $2.568 Trillion total. Current spending this year is around $3.6 Trillion. How is this a problem of taxation when our current rate of spending is almost 40% above the highest recorded tax reciepts ever?

So, if it promoted the general welfare, you believe the government should be able to tax everyone at 100%? I don't understand how it's idiotic to do what you think is right. If he actually believes he should be paying closer to 50%, and that is the right thing to do, then he shouldn't wait for the government to coerce him to do it.

WTF? What makes you think your arguments are valid when you just make up numbers and ridiculous examples. Your "50%" number was bull****. Now you pull 100% out of your ass? Really? That's the basis of your argument? Complete bull****? :doh:

No one is saying that raising taxes on the super rich alone is going to solve our problems. We aren't saying there isn't a problem with spending. What we are saying is that if you want to fix the economy, EVERYTHING should be on the table, including the fact that the ultra rich pay a lower percentage than the "working" rich who are the real job creators. We are saying that every little bit helps and if you are going to ask the poorest people in the country to sacrifice for the good of the economy it is wrong not to ask the very richest to do the same.

A simple example of what we are saying is this....

Lotus,one of the premier sports car manufacturers has a saying "more power makes you go faster in a straight line - shedding weight makes you go faster everywhere" (consider that to be the argument for less spending) and you know what? They are right. But you know what else? They add power every chance they get. Because power is *STILL* an important factor that you cant do without if you want to go fast.

Or as Frank Herbert said - "The people I distrust most are those who want to improve our lives but have only one course of action."

[DM72]

He is free to send as much of his money to the Federal Government as he wants. Nobody at the IRS is going to stop him.

Please, Mr. Buffett, lead by example instead of words. Send in a check for 80% of your money if you feel the government is owed that much.

And just to let you know, he and Bill Gates have agreed to leave most of their wealth to charity when they're gone.

[Mad Mike]

I really have to get out of this thread for a while before I start using the "M" word.

[Henry]

And you're ok with taxing up to 94%? That's just going to have to be a point where I respectfully disagree with you.

I'm not suggesting that we raise the rate to 94%. I'm saying that it's been done before and it hasn't caused the economy to collapse, or rich people to stop being rich. Further, it was a temporary measure, done to pay for something that benefitted all Americans. When you talked about raising taxes to 100% you acted as if you were speaking hyperbolically. You weren't. This country has done similar things before in times of crisis and survived ... even thrived to become the strongest economic power the world has ever seen. History does not agree with your opinion.

Gross tax reciepts actually went up every year from 2003 to 2007, even with a whopping 3.6% drop in the top rate (38.6% to 35% in 2003). It's just that spending went overboard. Spending is the problem.

That's some mighty fine cherry picking there. Were taxes lowered in 2003? You fail to mention that receipts dropped the previous three years before finally rising in 2004 (something which has only happened one other time since 1940.) Receipts didn't catch up to 2000 levels (when taxes were higher) until 2005. And in real money it was 2006 before receipts caught up. Six years. Six years of relative prosperity, when our coffers should have been filling rather than emptying, gone. Two years later we were hit with a huge recession and were already heavily in debt when we shouldn't have been.

Of course receipts rose every year for six straight years before the Bush cuts too. And we actually had a semblance of a balanced budget.

You know what else is funny? From 1943 to 1944, when the top tax rate rose from 88% to 94%, our tax receipts doubled.

[armstrong001]

The deficit and debt are a function of TWO things: (1) government expenditures; and (2) tax revenue. The American public wants to eat its cake and have it too. They lobby for more services AND lower taxes. That's the problem ... not just spending.

You're essentially arguing, "The problem is spending exceeds revenue!" Flip that coin over and you'll find, "The problem is revenue is lagging behind spending!"

You'd have a point if it weren't for the fact that our BEST YEAR EVER in tax reciepts was $2.6 Trillion, and our spending is currently somewhere around $3.6 Trillion. If you have NEVER made even close to as much money as you spend every year, it's not a problem with revenue, it's a problem with spending.

You're not in favor of a regressive tax, but you support the status quo. Buffet's point was that the status quo is regressive insofar as the uber-rich pay a lower rate than the middle class. So, you're against regressive taxes, but you're for them?

That 15% only affects money invested for over a year. Would you be willing to risk millions of dollars in the stock market for over a year, just to have a third of it taken (35% is the less than one year rate) for the privledge of making money? You've got brass ones.

[Busch1724]

Quote from the article:

I didn’t refuse, nor did others. I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

Let's take that statement and read between the lines...

If the wealthy are investing in capital gains to get a lower tax rate, what is their incentive to invest in job creation? Herein lies the problem...you can keep lowering tax rates on the rich all you want, it doesn't promote job creation. They take that money and invest it elsewhere, not the job market. WE had a period of time in this country where people that invested in the job market did so because they needed more jobs created to make more money. With captial gain tax rates where they are, there isn't an incentive to create jobs because right now creating a job does not make them more money. They can make more money in other ways.

[The 12th Commandment]

Too much spending = defecits. This is the problem. Even the year we had the highest gross tax reciepts ever (2007) the Government brought in $1.163 Trillion in personal income tax and $2.568 Trillion total. Current spending this year is around $3.6 Trillion. How is this a problem of taxation when our current rate of spending is almost 40% above the highest recorded tax reciepts ever?

So, if it promoted the general welfare, you believe the government should be able to tax everyone at 100%? I don't understand how it's idiotic to do what you think is right. If he actually believes he should be paying closer to 50%, and that is the right thing to do, then he shouldn't wait for the government to coerce him to do it.

You don't acknowledge that the current level of spending is crisis management NOT an MO. The whole we're spending too much argument is based on ignoring that large elephant in the room. You can disagree with Keynesian economics if you want, but it's either ignorant or disingenuous to have the discussion while ignoring a major factor like the great recessions.

[armstrong001]

WTF? What makes you think your arguments are valid when you just make up numbers and ridiculous examples. Your "50%" number was bull****. Now you pull 100% out of your ass? Really? That's the basis of your argument? Complete bull****? :doh:

50% is a higher rate than what the top tax bracket is paying, and I was using it for illustrative purposes to show how little of a dent it makes in the DEFICIT, not even the DEBT we already owe. As for 100%, I'm extending the argument that the government can tax what it wants to provide for the general welfare, etc. out to it's (il)logical conlcusion. If it's ok to tax at 35%, 40%, or 50%, why isn't it ok to tax at 100% as long as the government is "providing benefits" to you?

No one is saying that raising taxes on the super rich alone is going to solve our problems. We aren't saying there isn't a problem with spending. What we are saying is that if you want to fix the economy, EVERYTHING should be on the table, including the fact that the ultra rich pay a lower percentage than the "working" rich who are the real job creators. We are saying that every little bit helps and if you are going to ask the poorest people in the country to sacrifice for the good of the economy it is wrong not to ask the very richest to do the same.

A simple example of what we are saying is this....

Lotus,one of the premier sports car manufacturers has a saying "more power makes you go faster in a straight line - shedding weight makes you go faster everywhere" (consider that to be the argument for less spending) and you know what? They are right. But you know what else? They add power every chance they get. Because power is *STILL* an important factor that you cant do without if you want to go fast.

Or as Frank Herbert said - "The people I distrust most are those who want to improve our lives but have only one course of action."

I distrust anyone trying to "improve our lives". They're all in it for themselves.

When we live in an era when our government has NEVER collected more money than now (2003-2007), and we STILL canot come close to even having a ballanced budget, let alone paying down the debt. This is a spending problem.

---------- Post added August-15th-2011 at 11:22 AM ----------

Quote from the article:

I didn’t refuse, nor did others. I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

Let's take that statement and read between the lines...

If the wealthy are investing in capital gains to get a lower tax rate, what is their incentive to invest in job creation? Herein lies the problem...you can keep lowering tax rates on the rich all you want, it doesn't promote job creation. They take that money and invest it elsewhere, not the job market. WE had a period of time in this country where people that invested in the job market did so because they needed more jobs created to make more money. With captial gain tax rates where they are, there isn't an incentive to create jobs because right now creating a job does not make them more money. They can make more money in other ways.

When people invest money in the stock market, the companies they invest in put that money into job creation. When they put it in a bank, the bank loans the money to companies to create jobs, or to people who buy things from companies who create jobs. Even if they don't personally hire someone, they are helping to create jobs.

[Henry]

When we live in an era when our government has NEVER collected more money than now (2003-2007), and we STILL canot come close to even having a ballanced budget, let alone paying down the debt. This is a spending problem.

In real dollars we are collecting at 1998 levels. In terms of GDP, we are collecting the smallest percentage since 1950.

Of course spending is a huge, huge problem. Nobody in this thread is arguing that it isn't. But that's not what we are talking about here.

[zoony]

When we live in an era when our government has NEVER collected more money than now (2003-2007), and we STILL canot come close to even having a ballanced budget, let alone paying down the debt. This is a spending problem.

yah I was just gonna say, there is definitely a problem. I've been monitoring the bread industry, and I think they're pulling a fast one too. Did you know that a loaf of bread costs more today than it ever has throughout United States history? There is definitely something fishy going on. I blame Obama.

Your "they collect more than they ever have" claim is a great argument- GDP has remained unchanged since 1776.

Next up, we'll discuss the phenomenon of population. More or less over past 200 years? What say you?

[armstrong001]

I do indeed disagree with Keynesian economics.

Of course, if this is "crisis management", when does it end? When has government spending EVER returned to so-called normal levels after a "crisis"? Spending always increases. Sure, it may drop back to $3 Trillion instead of $3.6 Trillion, but it will never go back down to $2 Trillion or $1.5 Trillion, because now programs have been established to combat the "crisis" and cannot be just shut down. This crisis level will turn into the new budget baseline, and people will complain about "cuts" to the budget when the cuts wouldn't even return the funding levels to previous pre-"crisis" levels.

[The 12th Commandment]

When people invest money in the stock market, the companies they invest in put that money into job creation. When they put it in a bank, the bank loans the money to companies to create jobs, or to people who buy things from companies who create jobs. Even if they don't personally hire someone, they are helping to create jobs.

How come our largest corporations are sitting on huge piles of cash instead of playing the savior? I say it's because of the uncertainty (risk) involved with assuming that a congress that includes rash, non-compromising, head in the sand ideologues, will do what is best for the country, not what is most popular with their uninformed base.