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Op Ed From Warren Buffett


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That known Communist Warren Buffet on US Taxeshttp://www.nytimes.com/2011/08/15/opinion/...-rich.html?_r=2

Stop Coddling the Super-Rich By WARREN E. BUFFETT Published: August 14, 2011 OUR leaders have asked for “shared sacrifice.” But when they did the asking, they spared me. I checked with my mega-rich friends to learn what pain they were expecting. They, too, were left untouched. 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. Last year my federal tax bill — the income tax I paid, as well as payroll taxes paid by me and on my behalf — was $6,938,744. That sounds like a lot of money. But what I paid was only 17.4 percent of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent. If you make money with money, as some of my super-rich friends do, your percentage may be a bit lower than mine. But if you earn money from a job, your percentage will surely exceed mine — most likely by a lot. To understand why, you need to examine the sources of government revenue. Last year about 80 percent of these revenues came from personal income taxes and payroll taxes. The mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically nothing in payroll taxes. It’s a different story for the middle class: typically, they fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot. Back in the 1980s and 1990s, tax rates for the rich were far higher, and my percentage rate was in the middle of the pack. According to a theory I sometimes hear, I should have thrown a fit and refused to invest because of the elevated tax rates on capital gains and dividends. 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. Since 1992, the I.R.S. has compiled data from the returns of the 400 Americans reporting the largest income. In 1992, the top 400 had aggregate taxable income of $16.9 billion and paid federal taxes of 29.2 percent on that sum. In 2008, the aggregate income of the highest 400 had soared to $90.9 billion — a staggering $227.4 million on average — but the rate paid had fallen to 21.5 percent. The taxes I refer to here include only federal income tax, but you can be sure that any payroll tax for the 400 was inconsequential compared to income. In fact, 88 of the 400 in 2008 reported no wages at all, though every one of them reported capital gains. Some of my brethren may shun work but they all like to invest. (I can relate to that.) 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. Twelve members of Congress will soon take on the crucial job of rearranging our country’s finances. They’ve been instructed to devise a plan that reduces the 10-year deficit by at least $1.5 trillion. It’s vital, however, that they achieve far more than that. Americans are rapidly losing faith in the ability of Congress to deal with our country’s fiscal problems. Only action that is immediate, real and very substantial will prevent that doubt from morphing into hopelessness. That feeling can create its own reality. Job one for the 12 is to pare down some future promises that even a rich America can’t fulfill. Big money must be saved here. The 12 should then turn to the issue of revenues. I would leave rates for 99.7 percent of taxpayers unchanged and continue the current 2-percentage-point reduction in the employee contribution to the payroll tax. This cut helps the poor and the middle class, who need every break they can get. 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. Warren E. Buffett is the chairman and chief executive of Berkshire Hathaway.
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I'm guessing this site isn't in his browser history. He could give all his money if he wants, nobody is standing in his way.Oh, he means *other people*?Yawn.
I love how when a business person makes some self serving rant against the government you get all tumescent and treat it like gospel yet you dismiss something from a business person who is advocating something that you don't agree with even when it's against that business person's own narrow self interest but they feel it's better for society as a whole.
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Good for him. Perhaps he and his "Super Rich" friends should proactively give more if they're so inclined. Why do they have to wait for the Government to confiscate their wealth? Unfortunately my wife and myself are included in Obama's definition of "Rich" and will get caught in the same confiscation plans while the Super Rich remain only Very Very Rich.We cannot make the poor go away by confiscating the assets of the Wealthy and Upper Middle Class.I for one would welcome a little more "Coddling".

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He's structured his business dealings around the US tax code for decades, made a mint , and now is wanting us to believe he is concerned he doesn't pay enough taxes.Why doesn't he write an article about how he wants the IRS to no longer allow him his depreciation on his fleet of NetJet airplanes. That is the only way to make that entire business profitable.Then when the business folds, and a few thousand people are laid off and no longer pay income tax, he can talk about how great it is that the IRS closed the loophole on NetJet that he has made millions from for 10 years.Any chance his investment company , Berkshire Hathaway, uses the current tax rates to show prospective investors the results of their investments into his company?A guy 'exploits' the system until he is the richest man in America, and now says he thinks the tax rates should be raised. He got his, now we need to stop someone else from doing the same thing he did.The last time Buffet got involved in politics was when he endorsed Obama for president. He should shut his mouth with that track record

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I'm guessing this site isn't in his browser history. He could give all his money if he wants, nobody is standing in his way.Oh, he means *other people*?Yawn.
Wow. The "other" people you reference include only a few thousand people, including himself. Find me another similarly-sized group of people that argue for higher tax rates for themselves only. Go ahead, I'll wait.I'm sure you know that Mr Buffett has already given billions, and pledged billions more to help people even more needy than Americans. But yeah, what a selfish dick. Just trying to pass the buck.
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Good for him. Perhaps he and his "Super Rich" friends should proactively give more if they're so inclined. Why do they have to wait for the Government to confiscate their wealth?
Because there are people more needy than Americans. Do you guys really not get this? It's like if Bobby Fischer gave me a suggestion in a chess game. He's still going to win, and the suggestion is not to his benefit, but he still makes it. Why? He wants the chess game to be better. It is to everyone's benefit if the US is stronger.One person giving more money makes no difference. A structural change may well make a difference. Should Bobby forfeit the game to me? No, that doesn't make chess any better. He's taught me something instead.Just because his company has done what they could to avoid taxes in no way invalidates his point. He has a responsibility to shareholders. Just because he has done what he could to avoid taxes does not invalidate his point. One person's taxes are not relevant, and perhaps he feels his money was better spent making more money, and being able to give it away at the end. I'm pretty sure the expected rate of return on Warren Buffett is better than that of the US government.
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Because there are people more needy than Americans. Do you guys really not get this? It's like if Bobby Fischer gave me a suggestion in a chess game. He's still going to win, and the suggestion is not to his benefit, but he still makes it. Why? He wants the chess game to be better. It is to everyone's benefit if the US is stronger.One person giving more money makes no difference. A structural change may well make a difference. Should Bobby forfeit the game to me? No, that doesn't make chess any better. He's taught me something instead.Just because his company has done what they could to avoid taxes in no way invalidates his point. He has a responsibility to shareholders. Just because he has done what he could to avoid taxes does not invalidate his point. One person's taxes are not relevant, and perhaps he feels his money was better spent making more money, and being able to give it away at the end. I'm pretty sure the expected rate of return on Warren Buffett is better than that of the US government.
So Warren Buffet should be allowed to make buckets full of money, because he was allowed to keep more of his money, and now can do better things with that money...but the rest of the country, we just need to hand it over to the government.I don't think you meant to say that.
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Maybe this is why BHO and friends should stop calling working people who make 250k and up "rich".... as a group on this web site there is little if any understanding of what "rich" really means.

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So Warren Buffet should be allowed to make buckets full of money, because he was allowed to keep more of his money, and now can do better things with that money...but the rest of the country, we just need to hand it over to the government.I don't think you meant to say that.
Other than you purposely not including Buffett from the latter part, yes, that is fine. You guys are questioning Buffett for making the money he did. He was simply taking advantage of the rules at the time, which is what everyone should do. He's choosing to give his money away to other people, not Americans. He is suggesting to the American government that they should try to take a bigger slice of the pie, because it is there for the taking.Buffett's personal choice with his wealth is not to give it to the general American public. That is irrelevant to this conversation.He believes the best choice for the Americans would be to force him (and others like him) to give more to the American public.Given the partisanship from some of this thread's posters, I'm not surprised that you guys can't accept that someone might understand that the 'correct' (in Buffett's opinion) course of action by another group might be inconsistent with their own preferences.Let's be honest here. The article said basically nothing. It is one (very important) person's opinion. His only supporting evidence is general anecdotes. It's just a fluff piece for people who already think a certain way to feel smart because one smart person is on their side. That several people's first impressions of the article is that the author is being selfish gives me no hope that US partisanship is going anywhere for a long time.
Maybe this is why BHO and friends should stop calling working people who make 250k and up "rich".... as a group on this web site there is little if any understanding of what "rich" really means.
If you make $250K+, net of deductions, then you are rich. If you choose to take 5-figure vacations or have a million-dollar mortgage, that is up to you.I don't recall anyone on FCP ever making any suggestions as to how 'rich' should be defined. Well, other than you hinting in every other post that you have your own business and want us to ask how much you make.
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I love how when a business person makes some self serving rant against the government you get all tumescent and treat it like gospel yet you dismiss something from a business person who is advocating something that you don't agree with even when it's against that business person's own narrow self interest but they feel it's better for society as a whole.
I don't judge the quality of the article based on whether they are a business person or not, I judge it on whether it makes sense.
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Wow. The "other" people you reference include only a few thousand people, including himself. Find me another similarly-sized group of people that argue for higher tax rates for themselves only. Go ahead, I'll wait.I'm sure you know that Mr Buffett has already given billions, and pledged billions more to help people even more needy than Americans. But yeah, what a selfish dick. Just trying to pass the buck.
He has all sorts of ways to pay more taxes, but he doesn't. He is just hoping that he can use his pull to make the tax laws hurt other people more than they hurt him. BG gave a huge example of somewhere that Buffet could easily pay more taxes just with some simple accounting.
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He believes the best choice for the Americans would be to force him (and others like him) to give more to the American public.
But he and every other rich person already has that choice. They didn't make that choice the first time, and they won't make it if the rules are changed. As always, they will use their pull to avoid taxes; they will pass the higher costs on to the poor; they will create fewer products. The rich will always win. He is basically saying "we rich run this show and keep choosing to screw everyone else, but this time, even though we are still running the show, we will make different rules this time that only affects us. Trust us."
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1) He has all sorts of ways to pay more taxes, but he doesn't. 2) He is just hoping that he can use his pull to make the tax laws hurt other people more than they hurt him. 3) BG gave a huge example of somewhere that Buffet could easily pay more taxes just with some simple accounting.
1 - Yes, and those only affect him. One person cannot make a difference to the revenues of the United States.2 - No. The opposite. The exact opposite. They already don't hurt him. That's what he says. He is saying people EXACTLY LIKE HIM, INCLUDING HIMSELF, should be hurt more. So, the opposite of what you said.3 - No, he didn't. He gave an example of how he could ignore his fiduciary responsibility to his shareholders by having a business pay more taxes. Those...are not the same.
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He has all sorts of ways to pay more taxes, but he doesn't. He is just hoping that he can use his pull to make the tax laws hurt other people more than they hurt him. BG gave a huge example of somewhere that Buffet could easily pay more taxes just with some simple accounting.
I do not think the following is an unreasonable position: every citizen or company should try and pay the minimum amount of tax as required by law AND the law should require that they pay more taxes.
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If you make $250K+, net of deductions, then you are rich. If you choose to take 5-figure vacations or have a million-dollar mortgage, that is up to you.I don't recall anyone on FCP ever making any suggestions as to how 'rich' should be defined. Well, other than you hinting in every other post that you have your own business and want us to ask how much you make.
seems to me you defined it for yourself pretty clearly above....this president set his bar at 250k and i have seen much more agreement on here as to that number being correct then feeling like it is to low. I think it is pretty clear that you don't understand what being rich is and i think as a broad observation most on here wouldn't either.side note, this one thing that Canebrain obviously understands.As far as my business goes of course I am self employed, WTF you don't have to read between any lines to know that. Anyone who can read can tell you what many people do for a living on this site. As for my income I don't think that conversation is being requested or offered, i appologize if i have misled you on that.
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But he and every other rich person already has that choice. They didn't make that choice the first time, and they won't make it if the rules are changed. As always, they will use their pull to avoid taxes; they will pass the higher costs on to the poor; they will create fewer products. The rich will always win. He is basically saying "we rich run this show and keep choosing to screw everyone else, but this time, even though we are still running the show, we will make different rules this time that only affects us. Trust us."
Do you really think he wrote that in a subversive effort to push tax laws to be changed so he could pay less? I guess that is a fun theory, but given he makes absolutely no concrete suggestions, seems like a crazy strategy.He even specifiically mentions removing entitlements. We all know if tax laws get any more complicated, billionaires will just find more loopholes and pay less. But simplifying by removing entitlements is one of the few areas that *might* have the expected benefit.
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seems to me you defined it for yourself pretty clearly above....this president set his bar at 250k and i have seen much more agreement on here as to that number being correct then feeling like it is to low. I think it is pretty clear that you don't understand what being rich is and i think as a broad observation most on here wouldn't either.side note, this one thing that Canebrain obviously understands.As far as my business goes of course I am self employed, WTF you don't have to read between any lines to know that. Anyone who can read can tell you what many people do for a living on this site. As for my income I don't think that conversation is being requested or offered, i appologize if i have misled you on that.
Do you want to argue the point, or just tell me I don't understand?By the above definition, I grew up in a "rich" household. My parents are "rich". Though I do not currently earn that much (surprise surprise), I am well aware of the lifestyle. Yes, I'm a walking, talking (typing) Jewish stereotype.If I don't understand what "being rich is" than I'd like to. I know $250k doesn't buy you yachts, jets or a date with Megan Fox, but it is more than a comfortable income. It's enough for food, shelter, a 7-figure home and private school for the little darlings.
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Do you want to argue the point, or just tell me I don't understand?By the above definition, I grew up in a "rich" household. My parents are "rich". Though I do not currently earn that much (surprise surprise), I am well aware of the lifestyle. Yes, I'm a walking, talking (typing) Jewish stereotype.If I don't understand what "being rich is" than I'd like to. I know $250k doesn't buy you yachts, jets or a date with Megan Fox, but it is more than a comfortable income. It's enough for food, shelter, a 7-figure home and private school for the little darlings.
Hmm, I would guess that is pretty close to what a date with Megan Fox costs.
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I do not think the following is an unreasonable position: every citizen or company should try and pay the minimum amount of tax as required by law AND the law should require that they pay more taxes.
Is it reasonable then to give money and vote for politicians who will lower your tax?
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1 - Yes, and those only affect him. One person cannot make a difference to the revenues of the United States.2 - No. The opposite. The exact opposite. They already don't hurt him. That's what he says. He is saying people EXACTLY LIKE HIM, INCLUDING HIMSELF, should be hurt more. So, the opposite of what you said.3 - No, he didn't. He gave an example of how he could ignore his fiduciary responsibility to his shareholders by having a business pay more taxes. Those...are not the same.
It's funny, when someone who wants smaller government accepts government benefits, I frequently see the complaint that it is hypocritical to both *take* benefits and *oppose* benefits -- even though there is no choice to pay into the system.Yet this is the opposite case -- where someone supports higher taxes has the choice to pay more taxes and doesn't.Yeah, I think this is a cynical attempt to make more money by Buffet. His companies make millions from government contracts, so more taxes means more money for him. And yes, he is saying this stuff knowing full well that he can influence policy enough that the increase in taxes will have little effect on him.You don't get to be the richest person in the world by promoting bad business decisions.
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It's funny, when someone who wants smaller government accepts government benefits, I frequently see the complaint that it is hypocritical to both *take* benefits and *oppose* benefits -- even though there is no choice to pay into the system.Yet this is the opposite case -- where someone supports higher taxes has the choice to pay more taxes and doesn't.Yeah, I think this is a cynical attempt to make more money by Buffet. His companies make millions from government contracts, so more taxes means more money for him. And yes, he is saying this stuff knowing full well that he can influence policy enough that the increase in taxes will have little effect on him.You don't get to be the richest person in the world by promoting bad business decisions.
I've seen the first argument too of course, but that doesn't mean it is a reasonable one.The man's time is worth thousands of dollars an hour. I think you are really stretching it to think he would take his time to write (or authorize) a very general article that is contrary to his views. Weirder conspiracies have been true, but that is far from the most likely or reasonable reading of that article.
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It's funny, when someone who wants smaller government accepts government benefits, I frequently see the complaint that it is hypocritical to both *take* benefits and *oppose* benefits -- even though there is no choice to pay into the system.Yet this is the opposite case -- where someone supports higher taxes has the choice to pay more taxes and doesn't.Yeah, I think this is a cynical attempt to make more money by Buffet. His companies make millions from government contracts, so more taxes means more money for him. And yes, he is saying this stuff knowing full well that he can influence policy enough that the increase in taxes will have little effect on him.You don't get to be the richest person in the world by promoting bad business decisions.
Holy crap you just can't accept that one of the most successful business people in the World might actually differ from your rigid ideology in what he thinks is best for the country as a whole. The business guys who rant and rave against the government know what's right since they're job creators when they advocate policies that will benefit themselves and Warren Buffett is making a cynical play to increase the size of government by having he and his fellow uber-rich pay more taxes that will allow his business to get more government contracts.
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Holy crap you just can't accept that one of the most successful business people in the World might actually differ from your rigid ideology in what he thinks is best for the country as a whole. The business guys who rant and rave against the government know what's right since they're job creators when they advocate policies that will benefit themselves and Warren Buffett is making a cynical play to increase the size of government by having he and his fellow uber-rich pay more taxes that will allow his business to get more government contracts.
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Let me address some of the counter arguments that were presented here.- "If he wants to pay more taxes, why doesn't he simply donate directly to the government what he would pay if taxes were increased"Buffet isn't only trying to control his own practices, he's trying to he's trying to affect the habits of all wealthy people who would potentially be effected by such a tax increase. So, even if he were noble enough to give 100% of his profits to the US government, it would still be viable for him to hold the position that taxes be increased for wealthy people because it's not a guarantee that all similarly wealthy people will be equally charitable.And, of course, he doesn't give all his profits to the government. He works hard to ensure that he pays low taxes. But it's not contradictory for him to desire to pay more. He recognizes that it's human nature to want to be as wealthy as possible, and it's a pragmatic reality that people will fight to reduce their own taxes. And yet these same people may recognize that it is for the greater good that their money be used in ways different than how they would use it personally. This is why we have a government in the first place, after all. We can't rely on people voluntarily doing what's best for all, so we create a structure which can force us to do so (Hobbes' Leviathian).- "The rich will always fight to have lower taxes."Okay, that's probably true, but it doesn't therefore follow that the government should do nothing to raise the taxes on the rich.- "People earning 250K aren't 'rich' "Regardless of a definition of 'rich', people earning that much are among the wealthiest americans. It's pretty backward-thinking to argue that one can't raise taxes on the the uber rich because it could effect those making 250k. While those making 250k have their struggles and certainly wouldn't be happy if their taxes were raised, it would be much worse for those making <100k if their taxes were raised significantly. If your starting premise is that we should not raise taxes on those making 250k, you don't say, "raising taxes on people making 250k would be bad, therefore we can't raise taxes on those making more than that." Instead you should argue that "raising taxes on those making 250k would be bad, therefore we certainly shouldn't raise the taxes of those making less." Buffet argues that if one wants to raise taxes, there is plenty of room to do so with millionaires without hurting investment or growth.

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