Buffett is right: Raise taxes on the wealthy
Ilya Shambat
(CNN) -- In Sunday's New York Times, Warren Buffett discusses the need
to raise taxes on the wealthy. He's absolutely right. Tax increases,
in general -- as well as tax increases on the wealthiest households,
in particular -- need to be a part of the solution.
Past major budget agreements, such as the 1983 Social Security reforms
and the 1990 and 1993 budget deals, ultimately included both revenue
increases and spending cuts. It's not hard to see why: Cutting
deficits from both sides of the budget provides a sense of fairness,
shared sacrifice and political equilibrium.
Also, raising taxes to pay for current spending has proved more
effective at restraining spending than allowing the government to
finance its outlays with deficits. Every time we have tried to cut
spending by restraining taxes, we have failed. In the 1980s under
President Ronald Reagan and in the past decade under President George
W. Bush, taxes fell, but spending rose. The only time in the past 30
years when spending fell was in the 1990s, under President Bill
Clinton, when taxes were also raised.
Even the massive tax increases during and after World War II --
amounting to a permanent rise of 10% to 15% of gross domestic product
-- and the much smaller tax increases in 1990 and 1993 did no
discernible damage to U.S. economic growth.
If we are going to raise taxes as part of the fiscal solution, the
tax burden on high-income, high-wealth households needs to rise. The
recently enacted debt deal contains only spending cuts and has little
or no impact on high-income households. Rather, it puts the entire
burden of closing the fiscal gap on low- and middle-income households.
High-income households should not be exempted from helping resolve the
nation's fiscal problem.
Households in the top 1% of the distribution can afford to contribute.
They have done enormously well during the past 30-plus years. In 1979,
their income accounted for 10% of total income. According to the most
recent data (from 2008), their share of total household income more
than doubled to 21%. In contrast, real income for middle-class workers
has remained roughly constant over the same time frame.
There are, of course, better and worse ways to raise taxes. A general
goal would be to broaden the tax base -- reduce the use of specialized
credits, deductions, loopholes and so on -- and minimize the extent to
which tax rates need to rise.
One good place to start? High-income households: Limit the rate at
which itemized deductions can occur to 28%. This would affect only
households in the highest income ranges, it would not raise their
official marginal tax rate, and it would raise $293 billion over the
next decade, relative to how much money would be raised according to
current law, according to the Congressional Budget Office. This would
be a small move in the right direction.
Of course, sticking to current law revenues -- that is, either not
extending the Bush tax cuts after their scheduled expiration date of
2012 or paying for any extension with a reduction in various tax
expenditures -- is even more important. Extending the Bush tax cuts
would reduce revenues by about $2.5 trillion over the next decade,
relative to current law. Counting net interest savings, it would cost
$3 trillion. Letting the cuts expire could actually help economic
growth since the lower deficits would more than offset the effect of
slightly lower marginal tax rates, and it would be progressive. That
would be a big move in the right direction.
Eventually, the nation will need to deal with the ballooning costs of
Medicare, Medicaid and Social Security for an aging population. Even
if substantial cuts are made to these programs, the combination of a
greatly expanded elderly population and higher federal net interest
payments than in the past (because of the higher public debt/GDP
ratio) will create a need for additional revenues. There are good
options there as well, including a value-added tax -- the equivalent
of a national consumption tax and a feature of the tax system of every
industrialized country except the U.S. -- and higher energy taxes, to
promote a cleaner environment as well as raise revenues.
None of this means that the U.S. needs to move to European taxation
levels. But between the depleted tax revenues we raise now -- the
lowest share of the economy in six decades -- and the high taxes
experienced in European countries, there is plenty of room to raise
revenues in an economically sound manner to support a reasonable level
of government.
Joel Olson
news:4d57d069-2fb4-4ef2...@d7g2000vbv.googlegroups.com...
>
They could put an itty bitty sales tax on stock shares.
Fred Brown
"Joel Olson" <joel....@cox.net> wrote in message
news:uO-dnZXHSpkm19bT...@supernews.com...
If Buffett feels he's so under taxed let him write a check to the Treasury
Department, Treasury is more than willing to accept donations.
That way he can assuage his guilty conscience without Congress having
to change the tax code.
Bet he won't though.
Joel Olson
news:4e4bc077$0$99418$bb4e...@newscene.com...
He was willing to give up the $30k or so that he gets from social security.
And, iirc, he has already committed the bulk of his fortune to the Bill and
Linda Gates Foundation.
Fred Brown
That's a relief, the 30K will cover my SS check for the next 18 months.
Why didn't he leave the bulk of his fortune to the Treasury Department?
Oh, I know. By leaving it to the Gates Foundation he screws the IRS
out of the Death Tax.
Now that's not very patriotic.
Frank McCoy
No, because that way HE decides where the money might do some real
good; instead of just going to inflate bureaucratic salaries.
>Now that's not very patriotic.
>
Looks incredibly patriotic to me.
--
_____
/ ' / ™
,-/-, __ __. ____ /_
(_/ / (_(_/|_/ / <_/ <_
MajorOz
> "Fred Brown" <fredbbr...@nowhere.com> wrote in message
>
> news:4e4bc077$0$99418$bb4e...@newscene.com...
>
>
>
>
>
> > "Joel Olson" <joel.ol...@cox.net> wrote in message
> >news:uO-dnZXHSpkm19bT...@supernews.com...
> >> "Ilya Shambat" <ibsham...@hotmail.com> wrote in message
Please tell me how this affects his willingness to pay more taxes
Joel Olson
news:2f5636d1-bfe6-4bf9...@t30g2000prm.googlegroups.com...
~~~~~~~~~~~~~~~~~~~~
Maybe you can find the show on the web somewhere.
He's a perky old coot, more animated and jumping around more than
that third party guy of a few years back.
But he makes 62 million a year and feels he owes the country something
for making that possible.
MajorOz
> "MajorOz" <Majo...@centurytel.net> wrote in message
Good for him.
He can sign over all but minimum wage to the gummint.
But don't fuck with MY taxes.
cheers
oz, who has made some money with Berkshire Hathaway (but sold
WAAAAAAY too early)
Fred Brown
"Frank McCoy" <mcc...@millcomm.com> wrote in message
news:hg2o47hpnigs61lpm...@4ax.com...
Get real Frank, nobody knows better where money should be spent than
the federal government. :))
Just look how successful the stimulus program was puting people back
to work. Cash For Clunkers was a rousing success, people flocked to
the dealers to swap in their gas guzzling clunkers to buy "green cars",
unfortunately most dealers didn't have that many vehicles on hand and
those that did sold gas guzzling pickups and SUVs, sadly most buyers
thought "Green" meant the vehicle should be painted green.
But not to worry, Obama is putting people to work......the feds are
spending $575 million to fund solar power projects this year.....in India.
Gotta keep them Indians off the unemployment lines.
>>Now that's not very patriotic.
>>
> Looks incredibly patriotic to me.
Looks like a tax dodging scam to me, trying to avoid redistribution of
wealth. :))
Fred Brown
"MajorOz" <Maj...@centurytel.net> wrote in message
news:2f5636d1-bfe6-4bf9...@t30g2000prm.googlegroups.com...
In 500 words or less, if he feels he's under paying all he has to do is
write a
check. Don't need Congress to change the tax code, in fact I understand
that there is a website for the purpose of donating to the Treasury Dept.
Simple as pie.
Fred Brown
What people are overlooking is those deductions and exclusions the affluent
enjoy were written into the tax code by........Congress.
[ Fred slaps self on wrist for mentioning that inconvenient fact]
Joel Olson
His opinion on taxes has nothing to do with his philanthropy.
That opinion, that taxation should be progressive, agrees with the opinion
of most respected economists, ever since Adam Smith announced it way
back when.
Its a step toward making the entire social system more equal.
Totally equal is impossible, but the degree of inequality generates
all corresponding social problems. Reduce the inequality, and you
reduce the problems.
MajorOz
> "Fred Brown" <fredbbr...@nowhere.com> wrote in message
>
>
>
>
>
>
> > "MajorOz" <Majo...@centurytel.net> wrote in message
...and incentive.
Frank McCoy
Not by all that much.
Only if you taxed people so that you didn't have any more net income
by having more gross income would you eliminate incentive.
Even the most progressive of taxes doesn't begin to approach that
level.
People forget that if you taxed the "rich" at 90% of everything over a
million dollars that they would STILL have more of that second million
to spend than most of us earn; and that doesn't include the first
million of which they would have more than thre-quarters. But nobody
is even suggesting a tax-rate near that high.
At a 50% tax-rate for that level, for every 10% increase in pay,
they'd exceed the national average of take-home-pay by close to
two-to-one. Definitely "incentive" to make more dough.
The thing *ignored* by most apologists for the rich is that they still
have the very SAME deductions and limits on taxes and Social-Security
that the regular wage-earners do ... plus many more deductions and
limitations (such as Capital Gains) that most of us aren't rich enough
to afford.
Not, mind, that the idea of slightly reducing taxes on Capital Gains
isn't a good idea. It is. It gives the rich incentive to invest
rather than socking away their money in gold or under a mattress and
thus taking it out of circulation. There is a huge difference however
between "slightly reducing" and "removing".
For every taxation gain, there's SOME loss.
However, nowhere near the losses the rich like to make people who are
less-rich believe. They'd have you believe that a top tax-rate of 50%
would, with SS and sales-taxes leaves them only a pittance to spend;
as if they were paying 50% in taxes on the first dollar plus having
all the other taxes we all pay as well.
There's a reason they're called "progressive taxes". The progression
is ONLY on money over so much made.
To hear a rich man complain, you'd think that with a 30% progressive
tax-rate on everything over a million dollars, that when he earned 2
million, he would be paying $600,000 in taxes; when in-fact the actual
taxes he would pay (counting all deductions such as Capital Gains)
would be more like $200,000 ... probably a far lower actual overall
tax-rate than the average-joe who earned $100,000 a year.
No, there is still PLENTY of incentive to earn more money.
Tesseract
If he paid twice as much, it would not even be noticed. But if all the
rich paid a bit more, it does add up and will be significant.
--
Tesseract
Fred Brown
There are three types of wealthy, the inheritors, the Vanderbilts, Hiltons,
etc.
The theives, Bernie Madoff and the like.
And the entrepreneurs.
> Its a step toward making the entire social system more equal.
> Totally equal is impossible, but the degree of inequality generates
> all corresponding social problems. Reduce the inequality, and you
> reduce the problems.
Nonsense. The more you give to those who don't contribute to society,
the more they demand.
Here we go, back to social equality, the slacker must be equal to the
achiver.
The person who works hard to get an education, becomes an entrepreneur,
invents a product or service the public wants, forms a company, secures
funding, employs people, pays wages and benefits, puts tax money into the
government coffers, accumalates wealth from hard work and the government
wants to take it to give to people who sit on their butts all day, too lazy
to
get an educaton and meaningful employment.
I read an article the other day about the British riots, seems most of the
rioters
were young men, under educated and on permanent unemployment, known
in the UK as being on the dole. Seems these young men make more money
from public assistance than they can make in the jobs mostly held by
immigrant
workers. They were rioting because the government wants to cut back their
allotments.
>
>
>
>
>
Joel Olson
>
> "Joel Olson" <joel....@cox.net> wrote in message
> news:vq2dncUreLlhTtDT...@supernews.com...
>> "Fred Brown" <fredb...@nowhere.com> wrote in message
>> news:4e4d41eb$0$31089$bb4e...@newscene.com...
>>>
>>> "MajorOz" <Maj...@centurytel.net> wrote in message
>>> news:2f5636d1-bfe6-4bf9...@t30g2000prm.googlegroups.com...
>>> On Aug 17, 11:23 am, "Joel Olson" <joel.ol...@cox.net> wrote:
>>>> "Fred Brown" <fredbbr...@nowhere.com> wrote in message
>>>>
>>>> news:4e4bc077$0$99418$bb4e...@newscene.com...
>
>>
>> That opinion, that taxation should be progressive, agrees with the opinion
>> of most respected economists, ever since Adam Smith announced it way
>> back when.
>
> There are three types of wealthy, the inheritors, the Vanderbilts, Hiltons,
> etc.
> The theives, Bernie Madoff and the like.
> And the entrepreneurs.
>
Ah. Old money, Financiers, and New money (Oprah, Garth Brooks,
Tony Romo, etc.).
>> Its a step toward making the entire social system more equal.
>> Totally equal is impossible, but the degree of inequality generates
>> all corresponding social problems. Reduce the inequality, and you
>> reduce the problems.
>
> Nonsense. The more you give to those who don't contribute to society,
> the more they demand.
>
> Here we go, back to social equality, the slacker must be equal to the achiver.
> The person who works hard to get an education, becomes an entrepreneur,
> invents a product or service the public wants, forms a company, secures
> funding, employs people, pays wages and benefits, puts tax money into the
> government coffers, accumalates wealth from hard work and the government
> wants to take it to give to people who sit on their butts all day, too lazy to
> get an educaton and meaningful employment.
> I read an article the other day about the British riots, seems most of the
> rioters
> were young men, under educated and on permanent unemployment, known
> in the UK as being on the dole. Seems these young men make more money
> from public assistance than they can make in the jobs mostly held by immigrant
> workers. They were rioting because the government wants to cut back their
> allotments.
>
Entrepreneurs. Can you name 3 of them who have arisen in the last decade?
More generally, you're concerned with the lack of social mobility. So am I.
http://www.economist.com/node/15908469
Referring to your program for success, 1) get an education, when should a
young person start, and where? How about preschool?
http://www.physorg.com/news171783969.html
http://medicalxpress.com/news/2011-08-robust-preschool-effects-language-literacy.html
Note that funding for that was completely cut out of Obama's bill, according to
the Economist article.
Fred Brown
Anyone who starts a business, be it a pizza shop, lawn care, car detailing,
social network, or airplane factory is an entrepreneur. The title is not
limited
to Bill Gates, Warren Buffett or the guys who started FaceBook.
> More generally, you're concerned with the lack of social mobility. So am
> I.
> http://www.economist.com/node/15908469
Once upon a time the better your education the better your chances to move
upward socially. Today the good jobs, both blue collar and white collar are
disappearing overseas. Pretty hard to be upward mobile when the best job
you can get after four years of college is assistant manager at a McDonalds.
My sister-in law has degrees in mathmatics and computer science. She used
to be highly paid until the job went to India. Now she works for a company
that provides "help desk" services for various companies. Your HP computer
acting up, you call the HP help number and you'll probably wind up talking
to my sister-in-law in Watertown NY who does not work for HP.
Pays a hell of a lot less than she used to earn too.
> Referring to your program for success, 1) get an education, when should a
> young person start, and where? How about preschool?
> http://www.physorg.com/news171783969.html
> http://medicalxpress.com/news/2011-08-robust-preschool-effects-language-literacy.html
>
> Note that funding for that was completely cut out of Obama's bill,
> according to
> the Economist article.
Top educators have been dumbing down the educational process since the
1970's.
It's not where you begin the process, it's the quality of the educators.
Teachers
these days barely know the subjects they are trying to teach.
A few years back a group of recent teaching school graduates took the CT
state
teachers exam, so many flunked that the state education dept scaled the
grades so
that they passed. Somehow this leaked to the press and the applesauce hit
the
rotating appliance.
My 11 year old grandson can tell me all about global warming but does not
know the capitol of this state, the names of the adjoining states, where
other
states are geographically located or other countries in the rest of the
world.
The only president he can name is Obama, he has no idea who is governor
of this state. His writing or I should say printing is atrocious, he never
learned
the Palmer method of writing, teachers say it not necessary to learn to
write,
all composition will be done on a computer. The same with spelling, teachers
encourage phonetic spelling, the computer has a spell checker. The kid
doesn't
want to read, the words look "funny" because he never learned to spell
correctly.
I have to admit the kid's a whiz on the computer, knows how to find and play
hundreds of games, none of them educational but he's good at killing aliens.
He can use Google to find games, has no interest in finding anything else.
Teachers here in grades 1-8 earn $50K to $75K, essentially work 26 out of 52
weeks or 1040 hours. The average private sector worker puts in 2080 hours,
minus holidays and vacations, over a 52 week period for the same money.
Our kids can't write or spell, know nothing about geography, civics or
history
and the teachers complain about being under paid.
Scheesh.
Gotta go, Frank wants his soap box back.
Frank McCoy
>Our kids can't write or spell, know nothing about geography, civics or
>history and the teachers complain about being under paid.
You forgot math of any kind.
Logic got left out over a century ago.
Reasoning was never in there.
As for learning how to find things, other than looking them up on
Google ... My mom taught me how. They didn't teach THAT in any
school.
And yet, reasoning, how to learn, and where to find are the three most
important lessons one is supposed to pick up from school. Anything
else is just rote memorization ... worthless knowledge in the real
world.
>Scheesh.
>Gotta go, Frank wants his soap box back.
It's empty.
NEXT!
John J Stafford
"Fred Brown" <fredb...@nowhere.com> wrote:
> If Buffett feels he's so under taxed let him write a check to the Treasury
> Department, Treasury is more than willing to accept donations.
Buffett is way to smart to give his fortune to an enterprise he cannot
influence to the better. Moron.
John J Stafford
put them on something like a Devils Island until they learn, or do not,
how to read, writ and speak their native language (English) and release
them only when they can appreciate living in a civilized group. If they
fail, send 'em back to first-grate Devil's island or just shoot 'em dead.
Joel Olson
Back in the early '60s, along the way to my BA, I took a couple of education
courses. Was doing fine, with a running B, until I started reading the material
and studying for the tests. That brought me down and I ended with a C. The
instructor had fine-tuned (statistically) his test questions so much that they
all
produced a normal distribution, i.e. the entire tests were random. The students
were mostly young ladies in search of their MRS degree, who couldn't hack
any other major.
So I tend to agree with Maj.OZ. Unless things have changed a lot, our kids are
being taught by nice people who don't know much of anything, but may have
sparkling personalities.
Which doesn't change what they should be doing.
MajorOz
> "Fred Brown" <fredbbr...@nowhere.com> wrote:
>
> >Our kids can't write or spell, know nothing about geography, civics or
> >history and the teachers complain about being under paid.
>
> You forgot math of any kind.
> Logic got left out over a century ago.
> Reasoning was never in there.
> As for learning how to find things, other than looking them up on
> Google ... My mom taught me how. They didn't teach THAT in any
> school.
>
> And yet, reasoning, how to learn, and where to find are the three most
> important lessons one is supposed to pick up from school. Anything
> else is just rote memorization ... worthless knowledge in the real
> world.
Check out your local Jesuit High School.
heh, heh, heh
And the teachers make about on third of the public school teachers.
Al Nakba
Let the old Marxist bastard ante up on his assets or stfu!
Richard Fallstrom
<mcc...@millcomm.com> wrote:
My wife is a former school teacher who volunteers at a local elementary
school. While she may have MS and can no longer drive, she can still
assist the main teacher in waking those lovely minds to the sheer joy
of learning. I help with a three-year-old who occasionally stays with
us. Something I do with a niece is sing to her in melodies I make up on
the fly. One of my nephews is reading "Farmer In The Sky" which I hope
will awaken his own love of learning and thinking for himself.
I do get your points about the state of current education, though.
Reasoning is a tough one that not many get. I know I do know how to
reason in I can look at something someone else has designed and built
and think of a way to make parts of it meet a need of mine.
Rick
---
Ignorance is not knowing something, stupidity is a refusal to learn it.
Joel Olson
news:b872e860-0bd5-4d9d...@c8g2000prn.googlegroups.com...
~~~~~~~~~~~~~~~~~~~
Had you even heard of Warren Buffet before the above post?
FreyjaW
Lutheran high schools are no slouches either. The teachers aren't rich,
but they teach in a safe environment to students who want to learn.
Jesuit or Lutheran, you can't go too far wrong either way.
I went to a Lutheran grade school, then we moved to the desert where our
only choice was public junior high. They were so far behind me, I
actually had to be in independent study for a couple classes and should
have been for more. Yawn. I was so happy when we were back in the
Midwest and I was in a Lutheran high school where I was safe and my
brain could actually have things to do. Went straight to a Lutheran
college to get my BS in nursing and actually had to think, struggle, and
pull my hair out in frustration.
(When Concordia College moved from downtown Milwaukee to Ozaukee county
(just north of Milwaukee) we lost the 2nd semester sport of watching the
winos thaw in the spring. We also ended up being a dry campus, but I
was hardly the only one to smuggle alcohol on campus. I was just one
that no one suspected. ;-) )
--
Freyja the NurseWench
champion booze-hider
http://freyjaw.livejournal.com/
Joel Olson
news:ofGdncSZK4JWE8zT...@supernews.com...
>
I went to the Lutheran College in Sioux Falls - massively parentis loco.
Required religion courses, girls curfew at 10pm, etc.