There are no guarantees that being the third wealthiest person in the world will prevent you from making utterly ridiculous comments. Enter Warren Buffett, the Oracle of Omaha.
The famous investor and philanthropist wrote in last Sunday’s New York Times op-ed, that it was time for Congress to stop “coddling” the wealthy in America. Buffett urged Congress to increase tax rates on the wealthiest Americans as a way to help reduce the fiscal crisis facing America.
Warren Buffett could not be more in error.
David Logan (non-partisan Tax Foundation) disputes Buffett’s position writing that – “Even taking every last penny from every individual making more than $10 million per year would only reduce the nation’s deficit by 12 percent and the debt by 2 percent. There’s simply not enough wealth in the community of the rich to erase this country’s problems by waving some magic tax wand.” Excellent point.
Beyond being wrong, Mr. Buffett’s position ignores the fact that everyone who makes a dollar owns that dollar. It does not belong to government. It is not directly owed to any person. Being “super-rich” does not change the definition of ownership.
Morally, the more you have the more you are responsible for giving back. No argument there. But here’s the problem. Giving charitably is a far cry from having what is rightfully yours confiscated by any government, especially one whose leaders oversee $115 trillion in unfunded liabilities. Sharing and confiscation are not synonymous. Huge programs like Medicare, Medicaid and Social Security should be viewed as the biggest government run Ponzi schemes in history.
No one is denying the government needs money to function but the current tax system is obsolete and punitive. It needs to be dramatically reformed but another tax increase is not reformation. It is legalized theft.
The flat tax and consumption taxes are two examples of how to raise revenue in a more equitable manner. Slashing all unnecessary spending is critically important to bringing down debt and deficit. Mr. Buffett, in calling for higher taxes on the wealthy, ignores the need for new thinking on how government brings in and handles revenue.
Part of the lie repeated ad nauseam is that the rich are not paying their fair share. To borrow from a recent passionate comment from Al Gore – bullshit.
Blaming the rich is a specious argument. The top 1% of Americans already pay about 38% of federal, personal income taxes. The top 50% pay 97% of all income taxes. The bottom 50% pay almost nothing (National Taxpayers Union stats for 2008).
Ronald Reagan said, “The problem is not that people are taxed too little, the problem is that government spends too much.” Rational, thinking individuals recognize that America’s debt and deficit crisis exist, in large part, because of years of abuse and over spending. Seizing greater sums of private wealth is not the answer. Reigning in spending is.
Warren Buffett believes in higher taxes for others but not for himself. He does everything he can to avoid paying them. His personal wealth is bequeathed to the Bill and Melinda Gates Foundation. His estate will pay no exorbitant estate taxes. It is reported that Mr. Buffett takes only a tiny salary from Berkshire Hathaway and pays himself no dividends. Buffett has even admitted he is paying lower taxes than his hired help. Is Warren Buffett gaming the system?
When a multi billionaire, influential member of the super-rich speaks, he has a responsibility to do so in a manner that does not encourage the expansion of a far reaching, intrusive, irresponsible government. He should also avoid fomenting class warfare.
The best advice anyone can give is to rely more on self and less on government acting as a pickpocket targeting achievers on your behalf.
If Warren Buffett had been thinking clearly he would have quoted former President Gerald Ford who said, “A government big enough to give you everything you want, is a government big enough to take from you everything you have.”
That includes the super-rich like Warren Buffett.