Warren Buffett, Chairman, Berkshire Hathaway
Wow! Finally! Reality! A leader cuts through the gobbledygook of trickle down economics and tells it like it is. Warren Buffett may stand alone among the rich but he is standing up for what matters – although he may be a tad late in coming to the rescue. “The Oracle of Omaha,” as he is known, carries a big, pointy stick and he’s poking it right were it needs to be poked. But compared to Rupert Do-Anything-For-News Murdoch’s blunt stick, Warren may be over matched. Rupert and his fellow media moguls will publicly talk about Warren’s fundamental principle for a day and a sound byte and then move on. Or like Rupert’s Wall Street Journal, get into a factual pissin’ contest to try and misconstrue the intent of Buffett’s pronouncement. It’s about “shared sacrifice,” not who’s slipping through which tax loopholes. So when any rich person you meet that is against the Buffett idea, just ask them: What the hell could be wrong with the principle of shared sacrifice? This is about a different economic reality rather than the old tried and failed trickledown myth.
Perhaps Warren should buy Sarah Palin’s used (over used) bus, paint over her catchy, One Nation lie and call it, Shared Sacrifice. Or Robin Hood. And tour the country with a plan
to collect more from the rich and give more to the poor. If he did this, he might get some of the mercurial Republican candidates jumping on his raise-taxes-on-the-rich, bus-wagon and one of them might actually get elected, which could be a good thing.
Check some of the numbers that Buffett states:
• He paid only 17.4 percent of his taxable income — a lower percentage than was paid by the other 20 people in his office. Their tax burdens ranged from 33 percent to 41 percent
• The mega-rich pay income taxes at a rate of 15 percent on most of their earnings but practically nothing in payroll taxes. The middle class typically fall into the 15 percent and 25 percent income tax brackets and are hit with heavy payroll taxes to boot
• About 80 percent of (U.S.) revenues come from personal income taxes and payroll taxes
• In 1992, the top 400 had aggregate taxable income of $16.9 billion and paid federal taxes of 29.2 percent on that. In 2008, the aggregate income of the highest 400 soared to $90.9 billion (a staggering $227.4 million on average) but the rate paid fell to 21.5 percent
Buffett 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. Most wouldn’t mind being told to pay more in taxes as well, particularly when so many of their fellow citizens are truly suffering.” He talks about taxing those making more than a million but that doesn’t go far enough. Obama is closer to the mark with more taxes for incomes over $200-250,000. From that level up, anyone can afford to pay a little more.
The real question is: Are you listening John Boehner and your Congressional cronies? And you Mitt Romney? Rick Parry (that’s how Michael Colbert spells it)? Michele Bachmann? And most importantly, the 12 Congressional committee members about to recommend how to deal with the U.S. deficit? If you’re not listening then read Warren’s lips, “raise taxes on the rich.” Where have we heard that before? From the lips of George Bush One? No. George Bush Two? No. Any GOP candidate? No. President Obama? Yes! And a couple of hundred million middle and lower income people who have enough common sense to do the math, even though they do not have enough money or jobs. This isn’t about left-right ideology, this is about doing what is right. Because the truth isn’t halfway between right and wrong or left and right.
In Buffett’s op-ed in the New York Times, August 14, 2011 (a must read) he made many salient points. “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. 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.”
He added. “And to those who argue that higher rates hurt job creation (a GOP indefensible mantra – my insert), 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…. People invest to make money, and potential taxes have never scared them off.”
If “we the people” are not going to listen to Warren Buffett, then to whom are we going to listen to? Boehner? Romney? Bachmann? et al? … oh, I know, Rupert Murdoch. Please!
Warren represents the (decent) rich talking to the rich and it should resonate across the nation, louder and more pervasively than any Sarah Palin stunt, Michele Bachmann misstatement (pick one), Rick Perry prayer meeting, or a Mitt Romney smile. But it won’t. It ran in the New York Times, it received a little media spin – some negative (e.g., Rupert’s Wall Street Journal) – and then will probably go the way of the dodo bird. Why? Because even Warren’s money, intellect and leadership can’t trump all that saved tax money, which pumps billions into politicians’ re-election campaigns. And when it comes to winning elections, money trumps doing right, every time.
Ironically, on the same day of Buffett’s op-ed, August 14th, President Obama met with business leaders “to hunt for ideas to revive the economy…” And guess who was not there? Warren Buffett. That’s like going to a meet-the-teacher night and not meeting the teacher. Sounds more like a hastily arranged PR stunt.
One last pearl of wisdom from Buffett. “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.”
Reality? The rich get richer; the poor get poorer. The income gap between the richest and poorest Americans grew last year to its largest margin ever. The top-earning 20 percent of Americans – those making more than $100,000 each year – received 49.4 percent of all income generated in the U.S., compared with the 3.4 percent made by the bottom 20 percent of earners. And in 38 states, child poverty has increased between 2000 and 2009.
Reality? The sacrifice is not shared! And you can’t balance a budget, let alone reduce a deficit, by cuts alone. Revenue must increase – ask anyone trying to make ends meet.