Diary

Warren Buffett's Tax Buffoonery

In a recent commentary in The New York Times called ‘Stop Coddling the Super Rich’, America’s wealthiest man, investor Warren Buffett, is showing us who he really is. Wrote Buffett:

‘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.’

OK, here we go with the nonsense. So let’s analyze.

First, if the top federal tax rate today is the obscenely low (according to Democrats) 35% enacted under Bush, how can anyone pay 41%, Mr. Buffett? Or are your ghost writer’s facts as cloudy as your hometown of Omaha, Nebraska on a rainy spring day?

Second, Buffett’s own income is taxed at the top rate of 35%. So he is welcome to pay at that rate. But he does not. He takes every deduction to get to 17.4%, just like Obama paid only a 26% rate on his 2011 return even though he is in the top 35% bracket.

You know, the same Obama who says over and over something like “wealthy people like me don’t need a tax cut”.

Yeah, right… So send in more money, cheapo. You too, Buffett. Pay 35%. Or more.

What Buffett really is saying is that “We rich Democrats won’t pay more ourselves. No, we will not lead by example. We want legislation to assure that everyone pays more in taxes.”

But if the rates get jacked up, the Democrats will do what they’ve always done; they will sic the IRS – which is controlled by Democrat bureaucrats in Washington – on anyone who is a Republican or conservative while Timothy Geithner and General Electric and many other Friends of Obama will use every trick in the book to escape taxes, will never be audited and will never be questioned in the media.

Now let’s look at the big reality – Buffett really is saying is that everyone should pay more in taxes. Because Democrats have a tax for everyone at every turn like the 11.25% sales tax in Obama’s Chicago.  Middle class people and poor people and working people have to pay that rate too. So there you go. New York state has an 8.25% statewide sales tax.

Because Democrats tax reflexively. Thus this call to raise taxes on “the rich” really is just part of their ongoing strategy to empower Democrats and raise taxes on all. Because taxing the rich won’t reduce the deficit. So then liberals will have an excuse to go after their real target – the middle class – which they’re already hammering with taxes on everything, including myriad hidden taxes like funding free cell phones for poor people through a special Universal Service charge on your cell phone bill.

And even today, “the rich” include small-scale entrepreneurs grossing $800,000 a year on their dry-cleaning business, or “rich” people making $75,000 a year as a salesman or graphic artist, people who are economically sucker-punched by higher and higher taxes imposed by Democrats everywhere, every day on every level. Because according to socialist strategy, the definition of “rich” goes incrementally down, down, down every year until finally anyone who is not destitute is considered “rich” and the government controls all the wealth.

Thus Buffett’s call is the arrogance of the leftist billionaire crushing the little guy with more and more taxes so that he can be controlled.

The ultimate goal of this approach is to drive the middle class out of existence and to make America into a socialist-style government-controlled nation made up of three classes: the super-rich elite like Comrade Warren Buffett; the privileged government bureaucrat class made up of obedient liberal Democrats; and then everyone else is poor.  Writes Comrade Buffett:

‘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.’

OK, stop right there! So if the richest 400 had an income of $90.9 billion in 2008, then taking every penny of that $90.9 billion away still will only put a 5.5% dent in the budget deficit for 2011 ($1.65 trillion), won’t it Mr. B?

Thus deep spending cuts are the only solution to the deficit monster…

One study even considered what would happen if you took every penny of net worth from the 400 richest. Because it is important to remember that the $90.9 billion is an ‘annual income’ figure. It is not ‘net worth’ which includes total wealth for each person – investment portfolios, property, bank accounts, income, artworks, car collections, jewelry etc.

The study concluded that the total amount of net worth among the 400 richest in 2011 would be $1.4 trillion.  And the study pointed out obviously that even if the government simply took that whole $1.4 trillion – just wiped out all the richest people and took every single thing they had – it would only solve about 85% of the current deficit for only one single year.

And then the economy would collapse because that $1.4 trillion would have been sucked out of the private economy by the government and could not be invested in new growth.

Thus deep spending cuts are the only solution to the deficit monster…

So ultimately Comrade Buffett’s Tax the Rich strategy is nothing but a socialist feint for the government to control the economy and the people, and to keep people like Warren Buffett rich while everyone else gets poor. As socialism always has done and always will do. Because as a Friend of Obama reiterating Democrat talking points, Buffett would be spared the ax. Don’t doubt it. As will all the super-rich Democrats.

Buffett also wrote:

‘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.’

Wow. A whole $1.5 trillion. That sure sounds like a lot of money, Comrade Buffett! Please tell us more!

It isn’t a lot of money. This is “deficit reduction” to the liberal left. $1.5 trillion represents much less than 10% of what the accumulated debt is expected to be over the next 10 years without major spending cuts. And this shows what Warren Buffett’s column really is all about. It is socialist buffoonery of the first order.

Please visit my  blog at www.nikitas3.com for more conservative insights.