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blueslide88
Posts: 273 Member
Is Buffett a hypocritical ideologue?
blueslide88
Posts: 273 Member
According to this link it looks like Buffett's Berkshire company is battling the IRS concerning a billion dollars in taxes. Hey, just pay it Buffett!
http://www.newsmax.com/Headline/buffett-irs-back-taxes/2011/09/01/id/409520?s=al&promo_code=CF64-1#
http://www.newsmax.com/Headline/buffett-irs-back-taxes/2011/09/01/id/409520?s=al&promo_code=CF64-1#
Replies
It sure looks like it. He's playing two roles, then. Immoral capitalist and liberal ideologue. Quite a combination.
I don't hate Buffett. He's a shrewd businessman and a political buffoon.
Yeah, Warren, there is an actual pathway for people to donate extra bucks to the Feds, should they wish. And each year, several thousand people do precisely that. So pal, just get in line and shell out, if you think you're being undertaxed.
As far as the tax code being unfair, business investors get tax credits. Otherwise, they'd just sit on their millions or put it into low-pay and low risk muni bonds. Capital gains taxes offer the investor a break, because they'd lose everything. We ordinary folks may think it's unfair but private investment is the fuel that drives the private companies, mostly smallish or midsize, and that's the true foundation for our economy.
Anyway, that's Econ 101 and we all pretty much know it. Buffett's just trying to paint himself in a sympathetic color, why I really don't know -- he's always been a "clean" guy who just had an amazing talent for making money. So I don't have anything against him and I doubt other people do, either -- yeah, he's hugely rich but that's all right with me. Far as I know, he's made his money honestly and has no bad rep, personal or business. Maybe at his age, he's feeling lonely or unappreciated and wants attention? Other very wealthy people like Steve Jobs get all the attention, I guess. Who the heck knows why people do anything?
Rule #1: Follow the money.
Buffet is no fool. Any tax increase that he can convince the people and government to come up with, will inhibit his competitors more than him. This is like running down the hallway and tipping chairs over to slow the guy down behind you. This is no different than his push for stimulus spending on infrastructure repairs right after he paid $25 Billion for the largest train set in America... or T Boone Pickens push for government spending on a smart grid to carry the electricity from HIS wind mill projects in TX... or any one else that wants to use the power of government to enrich themselves.
The whole idea of tax breaks is to encourage investment. If the capital gains tex is increased, as Buffett seems to want, investment would dry up a lot.
If he really feels undertaxed he can write that big check to Uncle anytime.
I'd tend to disagree. Buffett has not got the reputation of being mean spirited in his business dealings, in fact he's got a reputation for being a good guy to work with. In regular investment broking, there is no "amoral" anyway, because unless you're shady, morals just don't figure into the picture -- he's not running a charity, after all. But he does seem embued with reasonable business ethics and hasn't been a cutthroat.
That is Ferengi rule of acquisition number 268.
Which is your opinion, but most business investors are honest. They may be hardnosed at time but business often has this trait. Immoral? Very few. You may think that making a profit is somehow "bad" but unless you're on the dole, we all "profit" via our paychecks.
Here's a small example: the publisher has "invested" in my small writing venture, signing me to a contract and paying me a fair royalty. They took a chance and put a few thousand bucks into my novel, with no guarantee that they'll profit. Small scale investment, similar to what the publisher has done with me, is how this country thrives. The government has very little to do with our financial status, and big business not much more. As I said, the engine that drives our economy is small and mid-size commerce, and much of that requires investors.
George Carlin
I'm not at all sure I agree with this statement. I think the cost that we are paying for all these social welfare programs is FAR FAR greater than any benefit (if indeed there IS any benefit) that we're getting in return.
Luis
DING DING DING. We have a winner. What Wambli is saying here is (IMO) exactly right. Big money being given to government does NOTHING for the economy except sink us further into the "big government" wasteland. Government produces NOTHING except a sense of national security, and provide the necessary laws to maintain order. Anything beyond that scope is a HUGE expense compared to any benefit derived therefrom and would be far better provided by private enterprise.
Luis
I tend to agree with Jeeper here. I'm NOT saying that social assistance programs are a waste. As I see it, we're too wealthy a country for truly needy people to be without basic necessities of life, such as shelter, food, medical care.
But lowering crime and minimizing social unrest? Some of us have been flat busted broke at times, out of work and out of money -- I have. And for some strange reason, I didn't start wearing baggy pants, rings in my eyebrow, and go around mugging old people or raping women. Instead I cut back to the bare necessities and took in part time work as I could until I finally got a job. Crime is committed by people who are without human concern. One of the cardinal sins that's often overlooked is "covet" but it's a principal cause of crime (to want what you cannot have, to quote Hannibal Lecter). I look at someone's new BMW, and think "That's a great car -- I'd sure like to have one some day, maybe if I work hard." but others see the BMW and think "That's a great car -- I think I'll take it."
But I say this is a distinct minority. Maybe you've been unlucky to work for unscrupulous people. Well, I've had this happen, a couple times in my work life, but most I've worked for have been responsible and practiced moral business behavior. I worked for huge Gulf Oil and never, never once saw a single example of management doing the wrong thing -- they were focused on safety and good conduct.
I did once work for a nasty company that one day got its ashes hauled, by the FBI no less. So yes it does happen, but not that often.
You seem to be one of the people who think that wealth is a zero sum game -- that there's only a certain quantity of money, and if someone makes $1mil, it takes away from others. But that's not how the economy works.
I'm not saying that "pure" capitalism works correctly because yes, it does need sensible regulation. But I do not agree that business practice today per se is greedy or predatory.
America *used* to be. Backup to the '50's and there you are.
Luis
LOL ok... lets take your first paragraph there that I highlighted. So you're saying that because the money is rolled back into the economy it's a good thing? Lets take a look at it another way... we paid in ~$5 for every $1 that got paid out in real money (give or take a bit), so that $43 Billion that Wal-Mart got cost us ~$200 BILLION in taxes. I'd MUCH rather have seen the $200 Billion in tax monies going directly into the economy than the $43 Billion that was left over when the Gov't got through "administrating" it. What Wal-Mart (or any other company) did with the money they got is TOTALLY IRRELEVANT. Everybody and every company has the right to make their own decisions (within limitations), and if you don't want to work for them or use them you have that right.
DON'T EVER FORGET THAT GOVERNMENT PRODUCES NOTHING AND EVERY EXPENSE OF GOVERNMENT IS JUST THAT... AN EXPENSE. The REAL issue is whether whatever they're providing is worth the cost, and this is where we differ in opinion. I personally want the Government to do as LITTLE AS POSSIBLE since I'd rather have my money to distribute as *I* see fit, rather than letting someone else do it for me for a substantial fee (which is basically what Gov't does). Every $1 that I don't pay the Government is a FULL $1 that I get to use to boost the economy... rather than 20 cents that is more likely than not poorly administrated.
Regarding Medicare, Medicaid, Obamacare, unless I'm misunderstanding you, you're making my argument FOR me.... The more money we give the Gov't, the more it goes to specially earmarked providers who benefit from it... but only after reducing my $5 contribution to $1 of outlay. This is a HORRIBLE deal for the average citizen. The average citizen pays ~$13K a year in healthcare (between what they pay and their employers contributions)... this is in ADDITION to your taxes... and you get back what? *MAYBE* 1/5th of it on an average year? TYVM, but I'd pass on that deal if I could. Just hand me the money and let me make my own decisions. Give everybody else the same opportunity. Even if *some* people make bad choices, you're giving everybody else FIVE TIMES as much money to spend as they'd see coming from the Gov't otherwise.
Luis
Minor point: the tax rate on those in the highest tax bracket of American in the 50's wasn't that low. Those making over $250,000 were taxed at about 90%.
http://en.wikipedia.org/wiki/Income_tax_in_the_United_States#1913_-_2010
Prior to deductions/exemptions/etc. yes. But without knowing what most people in various tax brackets ACTUALLY paid, it's somewhat useless.
BTW, that link is VERY misleading since the median income in 1950 was ~$3200 a year (which put them in the next to bottom tax bracket), and the base tax rate on that was 22%... not 38%. http://www.taxfoundation.org/publications/show/151.html
More to the point, due to a strong economy, a gallon of gas was only ~.18, a house was ~$8450, and a new car was ~$1500. According to some stats, approximately 85% of households had a man and a woman living in it, and the woman was only employed in ~20% of them. Nowadays, if your wife doesn't work, you're either viewed as some sort of neanderthal throwback, or a sugar daddy whose wife is living the highlife.
Median income 2007 was ~$31,100 http://en.wikipedia.org/wiki/Median_household_income
ok.... so income today is ~10X what it was then... so a gallon of gas should only be ~1.80, a new house should be ~$84,500, and a new car should be ~$15,000.... right?
Also... $250K/yr back in 1950 was the equivalent of what? ~$2.5 million/yr now? That's some pretty elite company there, and you can be sure they were (like today) taking advantage of every trick in the book to reduce their taxable income.
Luis
Also, you have to remember that the world was a lot different then than it was today. Europe and Asia were largely bombed out and in the rebuilding process. Korea was still going on for part of that decade.
The top income bracket was being taxed so heavily because what could they do, move? To where? Not so today.
Steve Jobs will be paid SS regardless. And he's eligible for Medicare, too.
Some of us (myself included) have paid into the system all our lives and we're now getting some back in return -- of course my SS will never recover all I've paid, but the check per month is pretty nice, fits okay with my small pension from Gulf Oil. And the medicare is good, too. If you're working for a big company that has health benefits, part of your medical is paid by the employer, some by you as co-pay. But after you're retired, few companies provide ongoing health coverage.
Where the waste is in medical care is 1- illegals, and 2- people who don't have basic coverage and therefore deluge the ER with small problems. It's not that the government shouldn't provide help to people, but that help should be means tested and given out in a smart, professional manner.
Same for all other government benefits. Which will cut the costs a lot.
Just for clarification: do you believe Steve Jobs should receive Social Security and Medicare?
I would argue that the natural resources, which are the basis for any country or region's economy, are somewhat slim in those two countries. I don't suppose many businesses are booming from the sale of rocks. Sure, Afghanistan has poppy, but that's not enough to run the whole country on. Alpaca farming? I don't think that will do it either. What else do either of them have?
I don't see how anyone can make a statement like that with a straight face.
Gotcha. I totally agree with what you're saying here *except* for the part about smaller gov't not always being better gov't. The less impact Gov't has on commerce, the better. Period. Yes, you need *some* regulation, but I think we have gone so far overboard with regulation that we're burying our economy with Governmental functions that have a very poor cost to benefit ratio.
Luis
We just have a TOTALLY different viewpoint on this statement. "social welfare programs are expensive, but they lower crime, ensure steady demand for necessity goods, and minimize the potential for social unrest".
1) I really believe that for the most part crime and social welfare programs are not related whatsoever. There may be isolated examples where they are, but *in general* people's propensity to commit a crime is NOT related to how much welfare money they are receiving from the government.
2) Necessity goods by definition will have a steady demand. Again... totally not related to social welfare programs.
3) Minimize the potential for social unrest? Are you kidding me? Look at the poor sections of LA... they receive as much per capita income from social programs as anywhere else in the country, and yet you have riots and looting in the street there more often than just about anywhere else in the country. Social unrest is MUCH more strongly related to the economic and educational level of the population than it is to any number of $$ being spent on welfare. How do you make people better off economically? Provide a good starting education that will get them into a CAREER (not just into college, but a CAREER and a JOB), and take as few of their dollars in taxes as possible so that they can better their own lives.
We're back to the argument that I'm trying to explain to you that every $1 spent by the Government on ANYTHING is the result of ~$5 that we paid in taxes. I actually suspect that the real ratio is much worse than that, but we'll go with 1:5 just for argument's sake. Therefore.... you have to convince me that we're better off receiving the $1 of service from Government than we are with me keeping $5 in my pocket. Ok.... national security... YES. I see the benefit of that. Don't get me wrong... all this crap we're doing spending billions on wars, and so called "intelligence", is NOT national security as far as I'm concerned. That is complete fraud and waste IMO. National security is the ability to go inflict pain on anybody foolish enough to come mess with us within our own borders, not rebuilding the infrastructure of foreign third world nations. Education, and some services (court, police, fire & rescue) I see a need to be provided by the government, but in MOST cases this should be done on a LOCAL level... not federal.
Which brings us to another point that I want to make.... the further up the Governmental chain you go (from local to federal) the less efficiently your money is being spent. This is due simply to the fact that it's easier to keep an eye on what's happening in your own backyard than it is to supervise what's happening all around the country where your tax dollars are being spent. IMO, you want to keep governmental functions as local as possible, with only broad regulation federally as required.
Luis
It doesn't make any sense to say that Walmart profits from your example, when it is paying the taxes to support various "social programs", as you say, and then gets the money
right back in "revenue". Walmart has had its tax payments taken from it by the government, which in turn paid the "social beneficiaries, who in turn paid some of it back to
Walmart in the form of purchases. I mean, it was Walmart's money to begin with. The government is simply playing "pass the buck around". The taxes Walmart paid were
deducted from funds allocated to shareholder dividends, so the shareholders get hit too.
In any event, Walmart does not benefit from "revenues" alone, it's the profit margin on those revenues, which averages about 3.5%, that has any benefit. So then Walmart will
include its profit margin amount (the 3.5% of revenues) as taxable profit, and pay tax on it again. Social Security taxes are a separate matter, in any event, as Walmart pays
them separately from its income taxes. I wouldn't put Walmart's revenues from "social beneficiaries" at anywhere near 10% of revenues, especially when Social Security
recipients are eliminated.
In summary, it is my view that your Walmart example in invalid and full of holes. Health care is another story. Oh, boy, who's going to pay for that disaster? Certainly not the
unions and other entities which were given exemptions. Obamacare is a forced universal health care plan, which, if not struck down by SCOTUS, with add to the country's
financial burdens and woes.
Hopefully, a Republican president and Senate in 2012 will repeal it, if SCOTUS's ruling falls short.
This comparison comes out of the mouths of the left when they attempt to discredit 1) the Constitution, 2) small government, 3)Libertarianism, 4) they try to justfy government social programs. It is truly a nonsensical comparison making most anything you say appear the same. Those two countries dont have our Constitution or a rule of law for starters.
I don't agree with this line of thinking, that by just starving the government of money all will be fixed. Two perfect examples of near libertarian paradises with virtually no taxes and even less government interference are Somalia and Afghanistan. How is the business environment in those countries? Actually I'd be interested to hear about any specific examples you might have of a country anywhere in the world that has low taxes, small government with minimal regulation and a thriving economy with high per capita income. I can't think of one off hand, but I may not be thinking hard enough.
Our two party system has us fooled that there are only two options...democrats offering more government and republicans offering us less government. I've got an idea, how about someone offer us BETTER government! I know many of you guys don't believe that is possible, and maybe it's not within our current political structure, but I guess I haven't become THAT cynical yet.
There are no other countries in the world which compare to the U.S. We are the world's standard, and all the imitations of the world fall short. Somalia and Afghanistan as a comparison? Surely you jest.
The establishment of the U.S. was the greatest experiment in government structure that has ever existed. No one can match our Constitution or Bill of Rights upon which we were founded. Remember the three branches of government serving as a check on each other? All the freedoms of the Bill of Rights? It had never, ever been done before. It was unique and it was based on maximizing freedom and limiting central government. We tossed out the King of England, and tossed out taxation by monarchy. And kept government to a minimum with well-defined roles (federal vs state).
No one is proposing anarchy. Smaller government is the key, government which is not bloated into bankrupcy with needless agencies spending borrowed money and maximizing taxes, redistributing the wealth, choking our capitalistic system with subjective obstruction and interference, and preponderance of social programs without limit.
It is freedom that is the key to our survival, most assuredly not government intervention. The free market will adjust itself, for the most part, with minimum government supervision. Giving government too much power is always a bad idea, as the world has learned.
We have been the best. It's the creeping socialism/marxism that has to be repelled, that is the cancer afflicting us now. Just look at where we are now, stumbling and bumbling, spending ourselves into oblivion, setting the stage for economic and social destruction.
Vote for better government, yes. We don't need a third party. We need a return to sanity.