Skip to comments.Warren Buffett is wrong
Posted on 08/27/2011 5:25:35 PM PDT by CutePuppy
The United States tax code is so backward that billionaire investor Warren Buffett pays only 17 percent in income taxes, a rate even lower than that of his secretary. Or so he claims. While I have great respect for Mr. Buffett, and while I agree that our tax code could benefit from major adjustments, Mr. Buffett's statement is misleading. And he knows it.
Even worse, when Mr. Buffett implies that wealthier Americans are under-taxed, it gives public officials cover to pursue disastrous policies such as Maryland's failed millionaire's tax, and the pending sales tax on interstate Internet purchases known as the "Amazon tax." Taxing the rich and protectionism may poll well, but these policies demonstrably hurt the same middle class and lower-income citizens they purport to protect.
Throughout his career, Mr. Buffett has been influential in creating hundreds of thousands of jobs and billions of dollars in wealth, and he has directly and indirectly paid billions of dollars in taxes. But Mr. Buffett is an equity owner in the companies he has created. As such, Mr. Buffett takes all of the risks and gets paid last: after his employees, after his creditors, after every form of government. While he is partially correct that his "income" is only taxed at 17 percent, Mr. Buffett is also guilty of some sleight of hand. ..... < snip >
..... Let's pretend one of Mr. Buffett's companies is in Baltimore. Assuming his secretary makes $36,000 per year, excluding payroll taxes (which are ostensibly reserved for the employee's direct benefit), and after certain standard deductions and personal exemptions, the secretary's combined state, local and federal tax rate would be about 19 percent.
Unlike Mr. Buffett's secretary, the capital representing Mr. Buffett's "income" would have already been taxed ... before it ever reaches Mr. Buffett.
(Excerpt) Read more at mobile.baltimoresun.com ...
It's easy to be a hypocrite when you are a Democrat, and easy to be a Democrat if you are a hypocrite.
But what a gutsy move! Announcing that you're going to put money into a TARP bank when the stock is hovering near zero.
My memorable economic lesson: “Give a poor man a dollar and he’ll spend it. Give a rich man a dollar and he’ll turn it into $2.
Buffett doesn’t support higher taxes because he wants to pay higher taxes. He supports higher taxes because he wants you to pay higher taxes.
Gutsy...It drove the stock up. If he sold it, he would have made a ton of money.
Buffett gives new meaning to the old quid pro quo.
He's ACTUALLY what Dems say they HATE....but they know he's a HUGE DEM, so they close ther eyes to his HYPOCRISY and PRICE MANIPULATION.
Buffett is a fool.
"1The fool hath said in his heart, There is no God. They are corrupt, they have done abominable works, there is none that doeth good."
When Buffett dies (and we all die), only then will he know the waste his life has been. Without God, all of our efforts are but a vapor, and without meaning.
Perhaps he will come to God before he does die, but the odds are against it. His heart is stone cold, and there is no love for his Creator in him.
hummmm....Buffet’s BOA purchase is about as gutsy as my stopping at McDonalds for a Rolo McFlurry... proportionally speaking. Maybe less as he has gained some serious chits with Obama.
Spending vs investing...
Another pair of words that Democrats / politicians completely bastardized by turning the meaning of them 180°. They always talk about pure "pork" government spending as an "investment" (in infrastructure, education, environment etc. etc.)
doubt he could have cashed out that fast. Anyway, he’s getting a 6% div on it —it’s preferred stock.
It is only the want to be billionaires that pay these taxes ... they have their business that they are building and at the same time they have to carry this old fool on their back.
I love shit like this.
the poor man HAS to spend it. The rich man doesn't pay late fees, never paid full price for anything, and has people bending over backwards to give him deals for his money.
Did they tell you THAT in your economics lesson?
Didn't think so.
Anyone who’s been through Accounting 101 knows that Warren lied. Why did he think something this would pass over our heads?
Wonder what Berkshire Hathaway has got.. AND ... will be getting out of all of Buffetts political gambits??..
No doubt Buffett has his eye on Soros..
Partially right, but please follow me here:
WB and his company BH basically make money 3 ways.
1. They buy large companies at what they consider a value price.
2. They buy and own insurance companies to collect premiums that provide cash.
3. They buy smaller family-owned middle market businesses at fire-sale prices.
Now this is where it gets interesting.
When a family business owner dies a huge tax obligation is created if it is passed to the family. To prepare for this, expensive life insurance policies are purchased in advance (guess who sells them) to provide the cash for the tax obligation. The insurance payout is not taxable.
If the business owner doesn't buy the policy, then the tax obligation may force the family to sell the business quickly, sometimes at fire-sale prices. Can you guess who is ready with the cash to make the purchase and "help" the family?
So higher taxes on these business owners allow WB and BH to make money using methods 2 and 3 above.
How do you spell C-O-N-F-L-I-C-T?
Can anyone get this to Rush or Mark for more in-depth research?
Doubt it. The only danger to BoA is from the government itself as they see it as "deep pocket" defendant from which money can be safely extorted (shareholders and/or customers pay for that eventually).
But what a gutsy move!
Don't see that either. The structure of the loan/preferred/warrants id very similar to what he did with Goldman Sachs, only not as lucrative (interest rate is lower) and GS was in more dire straights then, at the height of liquidity crisis.
BoA is being bled by the feds and states' AGs, but it should have more than enough reserves. Buffett's investment is safe and is something that only few investors could structure. BoA also wanted the "halo effect" of Buffett to shine on this capital infusion.
Doug Kass: Brian Moynihan Got Fleeced By Buffett's BofA Bet - CNBC, by Drew Sandholm, 2011 August 25
It's a tag team.
Obama uses Buffet's name to create the illusion that he understands business.
Buffet gets the inside track on deals.
Remember that earlier in the week Obama had been talking up a mortgage refi program.. No details yet, but BAC did purchase and now owns countrywide.
Something is up, we just don't know what it is quite yet, but Buffet does.
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