Tax The Wealthy

This article is from 2007 and appeared in the The Times located in London.

Buffett blasts system that lets him pay less tax than secretary

Tom Bawden in New York

Warren Buffett, the third-richest man in the world, has criticised the US tax system for allowing him to pay a lower rate than his secretary and his cleaner.

Speaking at a $4,600-a-seat fundraiser in New York for Senator Hillary Clinton, Mr Buffett, who is worth an estimated $52 billion (£26 billion), said: “The 400 of us [here] pay a lower part of our income in taxes than our receptionists do, or our cleaning ladies, for that matter. If you’re in the luckiest 1 per cent of humanity, you owe it to the rest of humanity to think about the other 99 per cent.”

Mr Buffett said that he was taxed at 17.7 per cent on the $46 million he made last year, without trying to avoid paying higher taxes, while his secretary, who earned $60,000, was taxed at 30 per cent. Mr Buffett told his audience, which included John Mack, the chairman of Morgan Stanley, and Alan Patricof, the founder of the US branch of Apax Partners, that US government policy had accentuated a disparity of wealth that hurt the economy by stifling opportunity and motivation.

The comments are among the most signficant yet in a debate raging on both sides of the Atlantic about growing income inequality and how the super-wealthy are taxed.

They echo those made this month by Nicholas Ferguson, one of the leading figures in Britain’s private equity industry, when he criticised tax rates that left its multimillionaire venture capitalists “paying less tax than a cleaning lady”.

Last week senior members of the US Senate proposed to increase the rate of tax that private equity and hedge fund staff pay on their share of the profits, known as carried interest, from the 15 per cent capital gains rate to about 35 per cent.

Lloyd Blankfein, the chief executive of Goldman Sachs, acknowledged in an interview yesterday that there were justified concerns about the huge profits generated by private equity firms and that he worried that income inequality was “poisoning democracy”. He also said that he would be voting for the Democrat candidate at the next election. Mr Blankfein is the highest-paid executive on Wall Street, earning $54 million last year.

Mr Buffett, who runs the investment group Berkshire Hathaway and is widely regarded as the world’s most successful investor, said that he was a Democrat because Republicans are more likely to think: “I’m making $80 million a year – God must have intended me to have a lower tax rate.”

Mr Buffett said that a Republican proposal to eliminate elements of inheritance tax, which raises about $30 billion a year from the assets of about 12,000 rich families, would broaden the disparity between rich and poor. He added that the Republicans would seek to recover lost revenue by increasing taxes for the less prosperous.

He said: “You could take that $30 billion and give $1,000 to 30 million poor families. Or should you favour the 12,000 estates and make 30 million families pay an extra $1,000?”

In this November 22, 2010 article that appeared in the Wall Street Journal Buffet is still leading the charge on this issue.

Can Pennsylvanians Afford More Democratic Control?

The latest proposal to raise the state personal income tax from its present level of 3.07% to 3.57% should have Pennsylvania citizens up in arms. Don't be fooled into believing our state government NEEDS to be the size it is. Our elected officials WANT it to be the size it is.

In this article written by Robert Swift for the Scranton Times he charts the rise in Pennsylvania's income tax rate since 1971.

Fluctuations in the state personal income tax rate since 1971.

2004-present 3.07%

1993 2.8 percent

1992 2.95 percent

1991 2.6 percent

1987 2.1 percent

1984 2.4 percent

1978 2.2 percent

1971 2.3 percent

In my previous post I talked about Governor Thornburgh having the highest amount of people on the PACE program. Democrat Robert P. Casey was Governor from 1987 to 1995. Look at the increases that happened during his term. Along comes Democrat Ed Rendell in 2002 and look at the next increase in the income tax rate. Todd Eachus who was elected in 1996 and Ed Rendell support another increase to 3.57%. A seventy percent jump in the income tax rate is totally unacceptable.

Ed Rendell hired 110 people during his announced hiring freeze. He should be held accountable for that action in this economic crisis that Todd Eachus called the largest State deficit since the Great Depression.

If this story was about George Bush people would be calling for his resignation. But somehow in Pennsylvania what Democrats do is accepted as par for the course. With the mess in Luzerne County continuing to develop under Democratic Control when is the "revolution" going to occur to rid our midst of Democrats who believe absolute power means absolute control. It is time the voters exercised their right as the fourth branch of government to reign in the stinkin thinkin that is pickin our pockets.