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Billionaires and Taxes

In most ways, I like the character of Warren Buffett.  He sticks to his principles and is willing to go against the trend.  What annoys me about Buffett is his hypocritical nature.  He is often quoted as saying that derivatives are “weapons of mass destruction” and yet he is one of the biggest writer of long-dated put options.  During the crisis he was very vocal about bank regulation, but only so long as it did not hurt his investments in Wells Fargo and Goldman Sachs.  When over the counter derivatives were put on the table for oversight, he certainly wanted his derivatives to be grandfathered in under the old rules so that he would not have to post large amounts of collateral.

Lately, Warren has been telling taxpayers to get over their anger, “Sentiment has turned very sour in the last three or four or five months…I hope we get over it pretty soon, because it’s not productive”.  That seems to be like a pretty easy statement to make when you are one of the wealthiest men in the world and can single-handedly influence political outcomes.

Likewise, Warren is very public about the fact that he pays only 17.7% on his taxes and suggests that the politicians should raise taxes on the rich already!  Raise income taxes or unrealized gains on stock Warren?  A person making a $250,000 salary is leagues away from someone worth $50B who can keep all gains tax free by not selling shares and by transferring wealth tax free to the Bill & Melinda Gates Foundation.   Warren even mocks the underclass by making a friendly little bet with his billionaire buddies: “I’ll bet a million dollars against any member of the Forbes 400 who challenges me that the average (federal tax rate including income and payroll taxes) for the Forbes 400 will be less than the average of their receptionists.”  Warren, I’m just dying laughing.

So why don’t you put your money where your mouth is Warren – go ahead and write a big check covering your back taxes because I am sure that Uncle Sam and the IRS would love to receive it.

Posted in Economics, Politics.

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