Buffett Urges Congress to Raise Taxes on ‘Coddled’ Billionai

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Zute
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Buffett Urges Congress to Raise Taxes on ‘Coddled’ Billionai

Post by Zute » Mon Aug 15, 2011 9:08 pm

http://www.businessweek.com/news/2011-0 ... aires.html
“My friends and I have been coddled long enough by a billionaire-friendly Congress,” the chairman and chief executive officer of Berkshire Hathaway Inc. wrote in an opinion article published in the New York Times. “It’s time for our government to get serious about shared sacrifice.”

Buffett’s advocacy of higher taxes for the “mega-rich” may reinforce President Barack Obama’s call for an end to tax breaks for corporate-jet owners. In the op-ed, the 80-year-old investor said his federal tax bill last year, or the income tax he paid and payroll taxes paid by him and on his behalf, was $6,938,744.

“That sounds like a lot of money,” Buffett wrote. “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.”
Hell ya!
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Gunny Burlfoot
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Re: Buffett Urges Congress to Raise Taxes on ‘Coddled’ Billi

Post by Gunny Burlfoot » Tue Aug 16, 2011 1:24 am

I agree. The US has such a budget shortfall, we should not just stop with 17, 33, or even 40 percent of Warren Buffet. Let's take it all. The US needs all of his money.

I have other suggestions I cribbed from this (hopefully) tongue-in-cheek video:
http://www.youtube.com/watch?v=661pi6K-8WQ

Better yet, we should take every penny all the billionaires earn over the magic $250K. Screw the rich, what have they done for us?
Better yet, we should not stop with billionaires' income. We should confiscate the holdings of the Forbes 400, and use all that wealth to pay for spending that Obama needs to get done.
Better yet, we should do this to everyone that makes over Obama's magic $250,000/year, sell all their holdings and use that to fund the governmental largesse.
Better yet, we should do this each year, so that the elderly, poor, and asundry others may keep their monthly checks a'coming.
Wait, we confiscated everyone's riches in a mere 12 months, and barely had enough to pay for the annual 4 trillion dollars of government spending?!
Whoops.

That video is not Economics 101, btw, I merely found it amusing, and a good illustration as to why the US does not have a "revenue" (TAX) problem, but a spending problem.

In all seriousness, there is a little economic lie underlying this whole "eat the rich" nonsense.
This lie is the "zero elasticity" lie. It is fervently believed by liberals that rich people, once you change the tax rules, will continue their behavior exactly as before the change was enacted.
This is false. Check what percentage of GDP the government has always received, regardless of what tax rates are or were. (Hint: it's always around 20%)
If you tax a "rich" behavior, the rich will change their behavior. If you tax more on capital gains, the rich will find revenue streams that are not capital gains. If you tax stagnant money, the rich will find other countries in which their money can be stagnant. If you impose more taxes on yachts, the rich will stop buying yachts. The majority of "the rich" did not become rich by refusing to respond to price changes and/or governmentally-imposed "spending" changes.
A very nice article by an economist here: http://econfaculty.gmu.edu/wew/articles ... Connivance
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Tudamorf
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Re: Buffett Urges Congress to Raise Taxes on ‘Coddled’ Billi

Post by Tudamorf » Tue Aug 16, 2011 2:16 am

Gunny Burlfoot wrote:That video is not Economics 101, btw, I merely found it amusing, and a good illustration as to why the US does not have a "revenue" (TAX) problem, but a spending problem.
Or it has both a tax problem, and a spending problem. Why can't conservatives admit that?
Gunny Burlfoot wrote:This is false. Check what percentage of GDP the government has always received, regardless of what tax rates are or were. (Hint: it's always around 20%)
Exactly, and since the Bush tax cuts it has dropped off quite a bit from that magic number, which is why taxes need to be raised back to where they were pre-Bush, closer to the 20% figure. Like during the Clinton era, when our finances were, for a brief period, in a relative state of order.
Gunny Burlfoot wrote:If you tax more on capital gains, the rich will find revenue streams that are not capital gains.
Eh, if you tax me 5% more on capital gains, I'm not going to suddenly dump all my stocks, and neither will Buffett or other very rich people. The tax increase won't make that big a difference, compared to the overall return. During the Reagan era, the preferential capital gains tax was eliminated altogether, yet people still invested.

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Zute
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Re: Buffett Urges Congress to Raise Taxes on ‘Coddled’ Billi

Post by Zute » Tue Aug 16, 2011 7:07 pm

The deficit is largely the result of Bush's tax cuts and the 2 wars.
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Fyyr
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Re: Buffett Urges Congress to Raise Taxes on ‘Coddled’ Billi

Post by Fyyr » Wed Aug 17, 2011 2:25 pm

Tudamorf wrote:I'm not going to suddenly dump all my stocks
Why would you dump stocks if the cap gains tax were increased?

You would then have to pay the cap gains tax. So you would do the opposite, you would hold onto stocks and not sell them.

An increase in cap gains tax would mean that people would hold onto stocks longer to make up for the tax. That would only slow sales of stock. Less sales, less cap gains tax revenue.

Which is fine, of course. Most people who sell stock at a gain, just turn around and reinvest in another stock. Rarely do they use the money to buy consumer products, for example, they don't stimulate the economy with the gains. These people have enough in stock that they just pull from the dividends for spending money, which is already taxed as income.

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Re: Buffett Urges Congress to Raise Taxes on ‘Coddled’ Billi

Post by Fyyr » Wed Aug 17, 2011 2:39 pm

Zute wrote:The deficit is largely the result of Bush's tax cuts and the 2 wars.
Really?

I worried about the deficit when I was 19, remember the old Time Square running marquee?. I don't worry about it any more. It doesn't affect me, never did, never will.

Bush's tax cuts affected me. I got a stimulus check, a couple of them. What did I do with them, I spent them. Which was the plan, and that stimulated the economy in my own little way. Just like everyone else who got a cut and rebate check.

I don't mind really spending money on the military. Those people in the military actually do something for their checks, unlike social spending where it is going down a rat hole on non productivity. And unless we are buying munitions and vehicles from other countries, non personnel spending is providing for productive jobs here(unlike social spending).



It does seem stupid to spend money on taking over a country, then fixing it up, and giving it back to the locals. Violates the whole reason for going to war in the first place. We should annex Afghanistan and Iraq, rename them New Puerto Rico and New Guam.

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Tudamorf
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Re: Buffett Urges Congress to Raise Taxes on ‘Coddled’ Billi

Post by Tudamorf » Wed Aug 17, 2011 11:37 pm

Fyyr wrote:
Tudamorf wrote:I'm not going to suddenly dump all my stocks
Why would you dump stocks if the cap gains tax were increased?

You would then have to pay the cap gains tax. So you would do the opposite, you would hold onto stocks and not sell them.
I mean, I wouldn't dump stocks if a tax increase were announced.

And I wouldn't change ANY of my trading patterns if the tax were increased from 15% to 20%. Neither would anyone who has any sense.

AbyssalMage
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Re: Buffett Urges Congress to Raise Taxes on ‘Coddled’ Billi

Post by AbyssalMage » Fri Aug 19, 2011 1:09 pm

Fyyr wrote:
Zute wrote:The deficit is largely the result of Bush's tax cuts and the 2 wars.
Really?

I worried about the deficit when I was 19, remember the old Time Square running marquee?. I don't worry about it any more. It doesn't affect me, never did, never will.
It affects you, just not the way the news reported it then or now. But I guess that wasn't your point?
Bush's tax cuts affected me. I got a stimulus check, a couple of them. What did I do with them, I spent them. Which was the plan, and that stimulated the economy in my own little way. Just like everyone else who got a cut and rebate check.
That analogy is like saying...
You poured a glass of water, along with everyone else, into a Texan watering hole. Eventually it still dries and your still left with a drought. Yeah, makes you (and everyone else) feel good, but your not solving anything or doing anything productive. But then again, you seem to have trouble looking past "the present."
I don't mind really spending money on the military. Those people in the military actually do something for their checks, unlike social spending where it is going down a rat hole on non productivity. And unless we are buying munitions and vehicles from other countries, non personnel spending is providing for productive jobs here(unlike social spending).
At least you "don't mind really spending money on the military." Its the only thing positive I could say.
It does seem stupid to spend money on taking over a country, then fixing it up, and giving it back to the locals. Violates the whole reason for going to war in the first place. We should annex Afghanistan and Iraq, rename them New Puerto Rico and New Guam.
Then you haven't read your history or studied it for that matter.

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Re: Buffett Urges Congress to Raise Taxes on ‘Coddled’ Billi

Post by AbyssalMage » Sat Aug 20, 2011 2:35 am

Gunny Burlfoot wrote:I agree. The US has such a budget shortfall, we should not just stop with 17, 33, or even 40 percent of Warren Buffet. Let's take it all. The US needs all of his money.

I have other suggestions I cribbed from this (hopefully) tongue-in-cheek video:
http://www.youtube.com/watch?v=661pi6K-8WQ

Better yet, we should take every penny all the billionaires earn over the magic $250K. Screw the rich, what have they done for us?
Better yet, we should not stop with billionaires' income. We should confiscate the holdings of the Forbes 400, and use all that wealth to pay for spending that Obama needs to get done.
Better yet, we should do this to everyone that makes over Obama's magic $250,000/year, sell all their holdings and use that to fund the governmental largesse.
Better yet, we should do this each year, so that the elderly, poor, and asundry others may keep their monthly checks a'coming.
Wait, we confiscated everyone's riches in a mere 12 months, and barely had enough to pay for the annual 4 trillion dollars of government spending?!
Whoops.

That video is not Economics 101, btw, I merely found it amusing, and a good illustration as to why the US does not have a "revenue" (TAX) problem, but a spending problem.

In all seriousness, there is a little economic lie underlying this whole "eat the rich" nonsense.
This lie is the "zero elasticity" lie. It is fervently believed by liberals that rich people, once you change the tax rules, will continue their behavior exactly as before the change was enacted.
This is false. Check what percentage of GDP the government has always received, regardless of what tax rates are or were. (Hint: it's always around 20%)
If you tax a "rich" behavior, the rich will change their behavior. If you tax more on capital gains, the rich will find revenue streams that are not capital gains. If you tax stagnant money, the rich will find other countries in which their money can be stagnant. If you impose more taxes on yachts, the rich will stop buying yachts. The majority of "the rich" did not become rich by refusing to respond to price changes and/or governmentally-imposed "spending" changes.
A very nice article by an economist here: http://econfaculty.gmu.edu/wew/articles ... Connivance
I think what was underlined and in bold say it all. You can't be taken "seriously" and your full of "nonsense." You honestly sound like you get your news from Fox "News" and belong at a Tea Party Rally :(

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Gunny Burlfoot
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Re: Buffett Urges Congress to Raise Taxes on ‘Coddled’ Billi

Post by Gunny Burlfoot » Sun Aug 21, 2011 12:13 am

It's you're, not your.

And I am to take your response as serious? Plucking a couple words out of context and using them as ad hominem attacks on me?

And even though your second statement is an associative ad hominem, I will say that my views align more or less with Ron Paul, although I never watch Fox News, CNN, or MSNBC. I look at figures on how much the US GDP is and how much the Obama budget calls for, and know there is no way to sustain that level of spending.

I do enjoy reading a certain libertarian economist's articles such as the excerpt found below, that demonstrates the utter folly of going after the "rich" as a source of governmental "revenue" to fix Congress's spending problem.
In 2011, Congress will spend $3.7 trillion dollars. That turns out to be about $10 billion per day. Can we prey upon the rich to cough up the money? According to IRS statistics, roughly 2 percent of U.S. households have an income of $250,000 and above. By the way, $250,000 per year hardly qualifies one as being rich. It's not even yacht and Learjet money. All told, households earning $250,000 and above account for 25 percent, or $1.97 trillion, of the nearly $8 trillion of total household income. If Congress imposed a 100 percent tax, taking all earnings above $250,000 per year, it would yield the princely sum of $1.4 trillion. That would keep the government running for 141 days, but there's a problem because there are 224 more days left in the year.

How about corporate profits to fill the gap? Fortune 500 companies earn nearly $400 billion in profits. Since leftists think profits are little less than theft and greed, Congress might confiscate these ill-gotten gains so that they can be returned to their rightful owners. Taking corporate profits would keep the government running for another 40 days, but that along with confiscating all income above $250,000 would only get us to the end of June. Congress must search elsewhere.

According to Forbes 400, America has 400 billionaires with a combined net worth of $1.3 trillion. Congress could confiscate their stocks and bonds, and force them to sell their businesses, yachts, airplanes, mansions and jewelry. The problem is that after fleecing the rich of their income and net worth, and the Fortune 500 corporations of their profits, it would only get us to mid-August. The fact of the matter is there are not enough rich people to come anywhere close to satisfying Congress' voracious spending appetite. They're going to have to go after the non-rich.
What he does not go into is that over 46 percent of US households pay NO net federal income tax payment after all the filings are done; most of those households' non-payments are due to their low income (<$30,000/year) http://www.taxpolicycenter.org/publicat ... ID=1001547
Which leaves only 42% of US households to shoulder the burden of the rest of the federal spending from August to December 2011.

The US cannot afford this level of spending. It must cut spending, not merely cut the INCREASE in spending over the next decade, which is what the recent "debt deal" was. It must cut spending. Buffet's suggestion of raising tax rates will not come close to fixing the US debt. In the extreme scenario listed above, tax rates can be raised to 100% on everything higher than $250K and even that extreme measure still does not solve the US debt problem, so I am at a loss as to where you think the 2012 US Government Budget of 3.7 trillion dollars is coming from, especially with all the wealth in the country being gutted in one year in the example above.

However, I feel that all this is wasted effort; since it doesn't agree with your preconceived ideas, you will simply dismiss the above as more "nonsense".
Tudamorf wrote:Exactly, and since the Bush tax cuts it has dropped off quite a bit from that magic number, which is why taxes need to be raised back to where they were pre-Bush, closer to the 20% figure. Like during the Clinton era, when our finances were, for a brief period, in a relative state of order.
And as I have stated before, Federal Income Tax rates can be 100%, 50%, 25%, it does not matter. Over the past 50 years, from 1960-2011, the total federal revenue received from all sources has been on average, ~15%-20% of the total US GDP. The tax rates from 1960-2011 varied widely from 90% to 33%, but the taxes received stayed at 15-20%, regardless of what the stated income tax rate. You can change the income tax rates all you want, but history over the last 50 years suggests it does not matter what the rates are, the federal government will get what it has always historically gotten.
Image
http://www.usgovernmentrevenue.com/revenue_history
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