• If you are having problems logging in please use the Contact Us in the lower right hand corner of the forum page for assistance.

nyt Stop Coddling the Super-Rich

Help Support Ranchers.net:

beethoven

Well-known member
Joined
Dec 11, 2009
Messages
746
Reaction score
0
Location
alberta
http://www.nytimes.com/2011/08/15/opinion/stop-coddling-the-super-rich.html?_r=1

cant remember if this has been posted

Op-Ed Contributor
Stop Coddling the Super-Rich
By WARREN E. BUFFETT
Published: August 14, 2011

Omaha

Related

Times Topic: Income Tax

Related in Opinion

Editorial: The Truth About Taxes (August 7, 2011)




OUR leaders have asked for “shared sacrifice.” But when they did the asking, they spared me. I checked with my mega-rich friends to learn what pain they were expecting. They, too, were left untouched.

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. Some of us are investment managers who earn billions from our daily labors but are allowed to classify our income as “carried interest,” thereby getting a bargain 15 percent tax rate. Others own stock index futures for 10 minutes and have 60 percent of their gain taxed at 15 percent, as if they’d been long-term investors.

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. It’s nice to have friends in high places.

Last year my federal tax bill — the income tax I paid, as well as payroll taxes paid by me and on my behalf — was $6,938,744. That sounds like a lot of money. But what I paid was only 17.4 percent of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent.

If you make money with money, as some of my super-rich friends do, your percentage may be a bit lower than mine. But if you earn money from a job, your percentage will surely exceed mine — most likely by a lot.

To understand why, you need to examine the sources of government revenue. Last year about 80 percent of these revenues came from personal income taxes and payroll taxes. The mega-rich pay income taxes at a rate of 15 percent on most of their earnings but pay practically nothing in payroll taxes. It’s a different story for the middle class: typically, they fall into the 15 percent and 25 percent income tax brackets, and then are hit with heavy payroll taxes to boot.

Back in the 1980s and 1990s, tax rates for the rich were far higher, and my percentage rate was in the middle of the pack. According to a theory I sometimes hear, I should have thrown a fit and refused to invest because of the elevated tax rates on capital gains and dividends.

I didn’t refuse, nor did others. I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, 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.

Since 1992, the I.R.S. has compiled data from the returns of the 400 Americans reporting the largest income. In 1992, the top 400 had aggregate taxable income of $16.9 billion and paid federal taxes of 29.2 percent on that sum. In 2008, the aggregate income of the highest 400 had soared to $90.9 billion — a staggering $227.4 million on average — but the rate paid had fallen to 21.5 percent.

The taxes I refer to here include only federal income tax, but you can be sure that any payroll tax for the 400 was inconsequential compared to income. In fact, 88 of the 400 in 2008 reported no wages at all, though every one of them reported capital gains. Some of my brethren may shun work but they all like to invest. (I can relate to that.)

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. Many have joined the Giving Pledge, promising to give most of their wealth to philanthropy. Most wouldn’t mind being told to pay more in taxes as well, particularly when so many of their fellow citizens are truly suffering.

Twelve members of Congress will soon take on the crucial job of rearranging our country’s finances. They’ve been instructed to devise a plan that reduces the 10-year deficit by at least $1.5 trillion. It’s vital, however, that they achieve far more than that. 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.

Job one for the 12 is to pare down some future promises that even a rich America can’t fulfill. Big money must be saved here. The 12 should then turn to the issue of revenues. I would leave rates for 99.7 percent of taxpayers unchanged and continue the current 2-percentage-point reduction in the employee contribution to the payroll tax. This cut helps the poor and the middle class, who need every break they can get.

But for those making more than $1 million — there were 236,883 such households in 2009 — I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains. And for those who make $10 million or more — there were 8,274 in 2009 — I would suggest an additional increase in rate.

My friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice.

Warren E. Buffett is the chairman and chief executive of Berkshire Hathaway.

A version of this op-ed appeared in print on August 15, 2011, on page A21 of the New York edition with the headline: Stop Coddling the Super-Rich.
 

ranch hand

Well-known member
Joined
Jun 4, 2005
Messages
1,360
Reaction score
0
Location
USA
How much do you have to make to be in the 41 percent tax bracket?
 

ranch hand

Well-known member
Joined
Jun 4, 2005
Messages
1,360
Reaction score
0
Location
USA
You would have to make 379,150 to make the 35 percent tax bracket
 

Steve

Well-known member
Joined
Feb 13, 2005
Messages
16,547
Reaction score
0
Location
Wildwood New Jersey
Some of us are investment managers who earn billions from our daily labors but are allowed to classify our income as “carried interest,” thereby getting a bargain 15 percent tax rate. Others own stock index futures for 10 minutes and have 60 percent of their gain taxed at 15 percent, as if they’d been long-term investors.

and all the "TAX THE RICH" proposals have not addressed these issues.. so even if the liberal democrat and president's tax the rich plans went into effect.. nothing would change.. the rich would still pay 15%

Buffet would still laugh, and make money.. as would most of the rich, the exception would be those few rich who still actually earn a living..

are the liberals really that dumb, to complain about one problem, and propose a solution that doesn't even address what they are complaining about?
 

Mike

Well-known member
Joined
Feb 10, 2005
Messages
28,482
Reaction score
0
Location
Montgomery, Al
When the TARP bailout passed, Berkshire Hathaway firms received a staggering $95 billion in bailout cash from U.S. taxpayers. In total, TARP-assisted companies made up almost a third (30%) of Buffett’s entire publicly disclosed stock portfolio. The payoff: by July 2009, Buffett’s Goldman bet and his congressional jawboning had yielded profits as high as $3.7 billion.

Incredibly, in a breathtaking public relations move, Buffett publicly complained that the government bailouts had put his company at a disadvantage, because funders “who are using imaginative methods (or lobbying skills) to come under the government’s umbrella–have money costs that are minimal.” Rolfe Winkler of Reuters best captured Buffet’s audacity: “It takes chutzpah to lobby for bailouts, make trades seeking to profit from them, and then complain that those doing so put you at a disadvantage.”

Still, despite Buffett’s apparent, and brazen, display of crony capitalism and political manipulation to produce billions in profits, Schweizer says that the most egregious part is that his behavior appears to have been entirely legal. Buffett merely leveraged his unique and powerful political connections to turn taxpayer money into massive private profits.

Now, with the 2012 presidential election right around the corner, Buffett plans to back President Obama again. In August 2011, the two men vacationed together in the plush surroundings of Martha’s Vineyard. Shortly thereafter, Buffett hosted an Obama fundraiser in New York City where contributors spent $35,800 for VIP tickets and the chance to discuss the economy with the Berkshire Hathaway CEO.

If Buffett’s political track record is any indication, his time spent alongside President Obama was an investment intended to yield a high rate of return–at taxpayers’ expense.
 

hypocritexposer

Well-known member
Joined
Apr 12, 2008
Messages
24,216
Reaction score
0
Location
real world
Mike said:
When the TARP bailout passed, Berkshire Hathaway firms received a staggering $95 billion in bailout cash from U.S. taxpayers. In total, TARP-assisted companies made up almost a third (30%) of Buffett’s entire publicly disclosed stock portfolio. The payoff: by July 2009, Buffett’s Goldman bet and his congressional jawboning had yielded profits as high as $3.7 billion.

Incredibly, in a breathtaking public relations move, Buffett publicly complained that the government bailouts had put his company at a disadvantage, because funders “who are using imaginative methods (or lobbying skills) to come under the government’s umbrella–have money costs that are minimal.” Rolfe Winkler of Reuters best captured Buffet’s audacity: “It takes chutzpah to lobby for bailouts, make trades seeking to profit from them, and then complain that those doing so put you at a disadvantage.”

Still, despite Buffett’s apparent, and brazen, display of crony capitalism and political manipulation to produce billions in profits, Schweizer says that the most egregious part is that his behavior appears to have been entirely legal. Buffett merely leveraged his unique and powerful political connections to turn taxpayer money into massive private profits.

Now, with the 2012 presidential election right around the corner, Buffett plans to back President Obama again. In August 2011, the two men vacationed together in the plush surroundings of Martha’s Vineyard. Shortly thereafter, Buffett hosted an Obama fundraiser in New York City where contributors spent $35,800 for VIP tickets and the chance to discuss the economy with the Berkshire Hathaway CEO.

If Buffett’s political track record is any indication, his time spent alongside President Obama was an investment intended to yield a high rate of return–at taxpayers’ expense.


Wasn't it the Tea Party that was against the bailouts? And wasn't it after the "horse had been let out of the barn", that the OWS movement started campaigning for obama?
 
A

Anonymous

Guest
Break Up the Banks
It makes no sense to keep bailing out bankers while demanding austerity for everyone else.


By Simon Johnson|Posted Friday, Dec. 23, 2011, at 1:26 PM ET

Santa Claus came early this year for four former executives of Washington Mutual, which failed in 2008. The executives reached a settlement with the FDIC, which sued them for taking huge financial risks while “knowing that the real estate market was in a ‘bubble.’ ” The FDIC had sought to recover $900 million, but the executives have just settled for $64 million, almost all of which will be paid by their insurers; their out-of-pockets costs are estimated at just $400,000.

To be sure, the executives lost their jobs and now must drop claims for additional compensation. But, according to the FDIC, the four still earned more than $95 million from January 2005 through September 2008. This is what happens when financial executives are compensated for “return on equity” unadjusted for risk. The executives get the upside when things go well; when the downside risks materialize, they lose nothing (or close to it).
At the same time, their actions and similar actions by other bankers are directly responsible for both the run-up in housing prices and the damaging collapse that followed. That collapse has impacted nonbankers negatively in many ways, including the loss of more than 8 million jobs.


It is also leading to austerity: Taxes are increasing and government spending is falling at the local and state level around the country. A difficult fiscal conversation still lies ahead at the federal level, but cuts and contractions of various types seem likely.

Some people argue that Americans need to tighten their belts. That’s an interesting discussion, particularly at a time with unemployment is still above 8 percent (with recent declines largely the result of many jobless workers’ decision to stop looking). Precipitate austerity is hardly likely to help the economy find its way back to higher employment levels.


But what about government support for the big banks? Is this contracting in the light of our current fiscal pressures? Unfortunately, it is not. Much government support remains, implicitly through allowing banks to be “too big to fail” and explicitly through various kinds of backing provided by the Federal Reserve.

The rationale behind supporting big banks is that they are needed for the economy to recover. But this position looks increasingly doubtful when the banks are sitting on piles of cash while creditworthy consumers and businesses are reluctant to borrow.


The same situation exists in Europe today, where the reality is even starker. Banks are receiving ever-larger bailouts, while countries that borrowed are cutting social programs and face rising social tensions and political instability as a result. Countries like Greece, Italy, and arguably Portugal overborrowed and now their citizens face severe consequences. But the bankers face no consequences whatsoever for overlending.

To be sure, some major European financial institutions may now face difficulties, and perhaps some of their executives will end up being fired. But does anyone think that the people who ran European banks into the ground will leave their positions with anything less than considerable wealth? There is no real austerity—now or possibly in the future—for leading bank executives.

The protesters of “Occupy Albany” issued a powerful consensus statement recently, which reads in part:


The interests of those who purchase influence are rewarded at the expense of the People, from whom the government’s just power is derived. We believe that this failure in our system is at the core of many interconnected issues we face as a society, and its resolution is key to a just future. We therefore demand true democracy, decoupled from the corrosive influence of concentrated economic power, and we call all who share in this common goal to stand with us and take action toward this end.

Big banks represent the ultimate in concentrated economic power in today’s economies. They are able to resist all meaningful reform that could really change their compensation schemes. Their executives want to get all the upside while facing none of the true downside.

But capitalism without the prospect of failure is not any kind of market economy. We are running a large-scale, nontransparent, and dangerous government subsidy scheme for the benefit primarily of a very few extremely wealthy people.


Jon Huntsman, a candidate for the Republican presidential nomination, is addressing this directly—insisting that we should force the largest banks to break up and to become safer. No other candidate is seriously confronting this issue head-on: Just saying “we’ll let them fail” is no kind of answer when the failure of megabanks would cause so much damage.

We should learn from both Washington Mutual and the Occupy movement. In both cases, the lesson is the same: Concentrated financial power is a gift that keeps on giving—but not to you.

If we'd had a Teddy Roosevelt- they already would of been broke up!!
 

hypocritexposer

Well-known member
Joined
Apr 12, 2008
Messages
24,216
Reaction score
0
Location
real world
Oldtimer said:
Break Up the Banks
It makes no sense to keep bailing out bankers while demanding austerity for everyone else.


By Simon Johnson|Posted Friday, Dec. 23, 2011, at 1:26 PM ET

Santa Claus came early this year for four former executives of Washington Mutual, which failed in 2008. The executives reached a settlement with the FDIC, which sued them for taking huge financial risks while “knowing that the real estate market was in a ‘bubble.’ ” The FDIC had sought to recover $900 million, but the executives have just settled for $64 million, almost all of which will be paid by their insurers; their out-of-pockets costs are estimated at just $400,000.

To be sure, the executives lost their jobs and now must drop claims for additional compensation. But, according to the FDIC, the four still earned more than $95 million from January 2005 through September 2008. This is what happens when financial executives are compensated for “return on equity” unadjusted for risk. The executives get the upside when things go well; when the downside risks materialize, they lose nothing (or close to it).
At the same time, their actions and similar actions by other bankers are directly responsible for both the run-up in housing prices and the damaging collapse that followed. That collapse has impacted nonbankers negatively in many ways, including the loss of more than 8 million jobs.


It is also leading to austerity: Taxes are increasing and government spending is falling at the local and state level around the country. A difficult fiscal conversation still lies ahead at the federal level, but cuts and contractions of various types seem likely.

Some people argue that Americans need to tighten their belts. That’s an interesting discussion, particularly at a time with unemployment is still above 8 percent (with recent declines largely the result of many jobless workers’ decision to stop looking). Precipitate austerity is hardly likely to help the economy find its way back to higher employment levels.


But what about government support for the big banks? Is this contracting in the light of our current fiscal pressures? Unfortunately, it is not. Much government support remains, implicitly through allowing banks to be “too big to fail” and explicitly through various kinds of backing provided by the Federal Reserve.

The rationale behind supporting big banks is that they are needed for the economy to recover. But this position looks increasingly doubtful when the banks are sitting on piles of cash while creditworthy consumers and businesses are reluctant to borrow.


The same situation exists in Europe today, where the reality is even starker. Banks are receiving ever-larger bailouts, while countries that borrowed are cutting social programs and face rising social tensions and political instability as a result. Countries like Greece, Italy, and arguably Portugal overborrowed and now their citizens face severe consequences. But the bankers face no consequences whatsoever for overlending.

To be sure, some major European financial institutions may now face difficulties, and perhaps some of their executives will end up being fired. But does anyone think that the people who ran European banks into the ground will leave their positions with anything less than considerable wealth? There is no real austerity—now or possibly in the future—for leading bank executives.

The protesters of “Occupy Albany” issued a powerful consensus statement recently, which reads in part:


The interests of those who purchase influence are rewarded at the expense of the People, from whom the government’s just power is derived. We believe that this failure in our system is at the core of many interconnected issues we face as a society, and its resolution is key to a just future. We therefore demand true democracy, decoupled from the corrosive influence of concentrated economic power, and we call all who share in this common goal to stand with us and take action toward this end.

Big banks represent the ultimate in concentrated economic power in today’s economies. They are able to resist all meaningful reform that could really change their compensation schemes. Their executives want to get all the upside while facing none of the true downside.

But capitalism without the prospect of failure is not any kind of market economy. We are running a large-scale, nontransparent, and dangerous government subsidy scheme for the benefit primarily of a very few extremely wealthy people.


Jon Huntsman, a candidate for the Republican presidential nomination, is addressing this directly—insisting that we should force the largest banks to break up and to become safer. No other candidate is seriously confronting this issue head-on: Just saying “we’ll let them fail” is no kind of answer when the failure of megabanks would cause so much damage.

We should learn from both Washington Mutual and the Occupy movement. In both cases, the lesson is the same: Concentrated financial power is a gift that keeps on giving—but not to you.

If we'd had a Teddy Roosevelt- they already would of been broke up!!


If you hadn't had a Clinton, they'd still be "broken up", but seeing as you are worried about what these candidates do in the WH bedroom.......and whether they are "true conservatives", I'm pretty sure you'll be voting for
Rick Santorum in the primary, correct?
 

Steve

Well-known member
Joined
Feb 13, 2005
Messages
16,547
Reaction score
0
Location
Wildwood New Jersey
We should learn from both Washington Mutual and the Occupy movement. In both cases, the lesson is the same: Concentrated financial power is a gift that keeps on giving—but not to you.

let see.. JP Morgan "invented Credit derivatives", started the collapse. and walked away with billions in Washington Mutual assets for pennies on the dollar.. under the fed and Obama

so what is the lesson.. thieves and scumbags get preferential treatment from Obama?
 

Latest posts

Top