Warren Buffett on Income Taxes

[utgibbs]

So, you're buying into the relative wealth argument and justifyingit because he identified it as a cause of corruption? We know it exists and is going to exist with or without money, but you take his point to try and support your lie that he was some huge advocate of massively disproportionate taxation? Nice work.

Why not just read Dr. Seuss and make shiz up?
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He was in favor of progressive taxation. And I have proven it. Instead of reading Dr Seuss, you could pick up WoN and find out for yourself.

:hi:

 

[utgibbs]

The progressive income tax with itemized deductions has utterly failed to do this. The super rich pay lower percentages than the small business owner. John Kerry's effective rate for instance was ridiculously low.

If you really want to achieve this end then the Fair Tax is the plan for you. The flat tax with a high standard deduction also works... say no taxes on the first $80K-$100K. That would GUARANTEE that the rich pay "something more" than that proportion."

Progressivity MUST feature in any fair tax plan.

I know why the Flat Tax is so appealing - it is simple and transparent.

It would not be difficult to make a table with brackets, put in a percentage for every bracket, and accomplish the same thing. And it would be more just. I would be ALL for this plan. No loopholes, no nonsense.

 

[RespectTradition]

Progressivity MUST feature in any fair tax plan.

I know why the Flat Tax is so appealing - it is simple and transparent.

It would not be difficult to make a table with brackets, put in a percentage for every bracket, and accomplish the same thing. And it would be more just. I would be ALL for this plan. No loopholes, no nonsense.

Progressivity CAN'T feature in any fair tax plan.

I know why the Flat Tax is so appealing - it is fair and just.

Should the police respond more rapidly for a rich victim than a poor one? (Note, I said should) Then it is unfair for the rich man to pay more for the same service. Should the rich get special lanes on the highway like in the old Soviet Union? Then it is unfair to charge them more for the same access. The only truly fair way to tax is to tax everyone for the services they use and split any common services equally. For example, you want to drive? Pay a tax per mile. You want to send your kid to school? Pay tuition. But common things, like military, police, etc, should be divided equally among the people since they ostensibly serve us all equally.

Since this approach won't fly among most of our populace, the next best thing is to charge everyone proportionately the same.

 

[RespectTradition]

Wrong on all counts.

We've been through this ad infinitum on this board, and I warned you how wrong you would be.

Adam Smith was a man of the Enlightenment, a moral thinker (the bourgeoisie assiduously avoid Moral Sentiments). In his own historic time, his mechanical ideas were progressive, reasonable. They are not so suited to our own historic time. However, his maxims, his ideas regarding morality, are still pertinent and important.



Wealth of Nations, Book 5, Chap 2, Article II

There are a host of other supporting quotes besides.

The "flat tax" interpretation is pure propaganda - unread in Adam Smith.

You quoted:
"The necessaries of life occasion the great expense of the poor. They find it difficult to get food, and the greater part of their little revenue is spent in getting it. The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. A tax upon house-rents, therefore, would in general fall heaviest upon the rich; and in this sort of inequality there would not, perhaps, be anything very unreasonable. It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion"

Adam Smith is NOT talking about income taxes here. He is talking about property taxes. He said that since the rich own more and better property it is only fair that they pay more for their house than a poor man. How that relates to a progressive income tax takes quite a stretch. He says that the rich should pay in proportion to their revenue (income tax) and a higher proportion on their property tax. You are stretching that to say "pay a higher proportion on income tax and a higher proportion on property tax".

If one looks closer, one sees that he does not endorse a higher proportion on the rich, he just notes that a property tax would fall higher on the rich and then says it would be unreasonable, but PERHAPS it wouldn't be VERY unreasonable.

Also, I liked the way you said that you think Adam Smith's ideas are mostly wrong but you are going to cherry pick the few that can be twisted to agree with you. A lot of intellectual honesty there.

 

[utgibbs]

Progressivity CAN'T feature in any fair tax plan.

I know why the Flat Tax is so appealing - it is fair and just.

Should the police respond more rapidly for a rich victim than a poor one? (Note, I said should) Then it is unfair for the rich man to pay more for the same service. Should the rich get special lanes on the highway like in the old Soviet Union? Then it is unfair to charge them more for the same access. The only truly fair way to tax is to tax everyone for the services they use and split any common services equally. For example, you want to drive? Pay a tax per mile. You want to send your kid to school? Pay tuition. But common things, like military, police, etc, should be divided equally among the people since they ostensibly serve us all equally.

Since this approach won't fly among most of our populace, the next best thing is to charge everyone proportionately the same.

Progressivity is the only just way to levy taxes. Full stop.

If you want to go down this path though, take your road example for instance - the rich use the roads far more than the poor. Take the school instance. The rich benefit (materially) from an educated underclass far more than the poor (although, their is an intrinsic and worthy good in education of itself). That the poor are paying more than their fair share is just a testament to the injustice in our current system. An injustice you had to emphasize early with your "should." And there are many other examples: the military, the Deptartment of Ag, the embassies, etc.

And let's remember, our overall tax structure is currently highly regressive.

I find it interesting that your emphasis on "should" was so necessary. It requires a move to the kind of justice system I espouse.

As always, folks, whether they mean to or not, gravitate to my point of view, as you have done here.

 

[utgibbs]

You quoted:
"The necessaries of life occasion the great expense of the poor. They find it difficult to get food, and the greater part of their little revenue is spent in getting it. The luxuries and vanities of life occasion the principal expense of the rich, and a magnificent house embellishes and sets off to the best advantage all the other luxuries and vanities which they possess. A tax upon house-rents, therefore, would in general fall heaviest upon the rich; and in this sort of inequality there would not, perhaps, be anything very unreasonable. It is not very unreasonable that the rich should contribute to the public expense, not only in proportion to their revenue, but something more than in that proportion"

Adam Smith is NOT talking about income taxes here. He is talking about property taxes. He said that since the rich own more and better property it is only fair that they pay more for their house than a poor man. How that relates to a progressive income tax takes quite a stretch. He says that the rich should pay in proportion to their revenue (income tax) and a higher proportion on their property tax. You are stretching that to say "pay a higher proportion on income tax and a higher proportion on property tax".

If one looks closer, one sees that he does not endorse a higher proportion on the rich, he just notes that a property tax would fall higher on the rich and then says it would be unreasonable, but PERHAPS it wouldn't be VERY unreasonable.

Also, I liked the way you said that you think Adam Smith's ideas are mostly wrong but you are going to cherry pick the few that can be twisted to agree with you. A lot of intellectual honesty there.

This again is a red herring argument. The mechanics are unimportant and vary with historic time. It is the maxims which are important. Smith rarely ever talked about income taxes. Few people earned incomes in his historic time.

The maxims are important. The quibbling over word choice belies the fact that Smith wrote an entire book on the subject. Moreover, there are several other passages throughout WoN itself showing that the quibbling over "proportion" is pure propaganda.

Finally, several people have good ideas littered among the bad. Intellectual dishonesty is genuflecting before ideas without critically digesting them.

 

[OrangeEmpire]

This again is a red herring argument. The mechanics are unimportant and vary with historic time. It is the maxims which are important. Smith rarely ever talked about income taxes. Few people earned incomes in his historic time.

The maxims are important. The quibbling over word choice belies the fact that Smith wrote an entire book on the subject. Moreover, there are several other passages throughout WoN itself showing that the quibbling over "proportion" is pure propaganda.

Finally, several people have good ideas littered among the bad. Intellectual dishonesty is genuflecting before ideas without critically digesting them.

rofl genuflecting
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[WA_Vol]

He's doing exactly what Joe Kennedy did in advocating the end of insider trading. Hell, Kennedy even went so far as to head up the SEC, after having made fortunes via insider trading.

Buffet bent every rule imaginable while amassing his wealth, which can't be taxed. Now he's all for taxing those using taxable income to amass wealth. He's being as disingenuous as possible in this crusade he's running.

For the record, I'm not opposed to more taxes on the high earners over time, but let's quit pretending that it's anything but a depressant to the overall economy. It will fill government coffers in the near term, fo sho.

This is a really good point and makes Buffet look very hypocritical. He took every tax cut he could while acquiring his wealth. I like Warren Buffet a lot, but on this issue it's do as I say not as I did.

 

[Redstater]

"Buffet bent every rule imaginable while amassing his wealth, which can't be taxed. Now he's all for taxing those using taxable income to amass wealth. He's being as disingenuous as possible in this crusade he's running". BPV

I understand that hyperbole is used on VN like oxygen but this is hyperbolic. And his wealth could be taxed at his death if he wasn't leaving it all the Gates Fdn. Unfortunately, the Gates Fdn will turn into an even bigger Ford Fdn and will fund all sorts of similar crap that has Henry Ford spinning in his grave.

 

[WA_Vol]

"Buffet bent every rule imaginable while amassing his wealth, which can't be taxed. Now he's all for taxing those using taxable income to amass wealth. He's being as disingenuous as possible in this crusade he's running". BPV

I understand that hyperbole is used on VN like oxygen but this is hyperbolic. And his wealth could be taxed at his death if he wasn't leaving it all the Gates Fdn. Unfortunately, the Gates Fdn will turn into an even bigger Ford Fdn and will fund all sorts of similar crap that has Henry Ford spinning in his grave.

Your taxed on the money you earn, not the money you have. It's easier for someone who has already amassed a fortune, to say hey tax those guys who are amassing their fortune at a higher rate now.

 

[NEO]

People need to realize that he lives on income that is taxed at capital gains.

This isn't the reality for 99% of the "rich" small business owners who's taxes he thinks should be raised. They are taxed at federal rates.

Big difference and he knows it ... sadly the public doesnt.

 

[MG1968]

here's something that will make LG's head explode:

Warren Buffett's Berkshire Hathaway Owes Taxes Going Back To 2002

Berkshire Hathaway, the eighth-largest public company in the world according to Forbes, openly admits to still owing taxes for years 2002 through 2004 and 2005 through 2009, according to the New York Post. The company says it expects to "resolve all adjustments proposed by the US Internal Revenue Service" within the next year.

of course, since it's Huffpo, they had to trot out the class-warfare angle in the very next paragraph

 

[Redstater]

Your taxed on the money you earn, not the money you have. It's easier for someone who has already amassed a fortune, to say hey tax those guys who are amassing their fortune at a higher rate now.

I agree 100% and Buffett is extremely disingenuous (been wanting to use that word all day)