Wednesday, August 24, 2011

Warren Buffett is a Hypocrite in Three Ways

From Jeff Jacoby, a discussion of multi-billionaire Warren Buffett, who thinks the rich should pay more taxes.

Jocoby makes a point that many others have made: if Buffett thinks he is under-taxed, he is perfectly free to make a voluntary contribution to the Treasury. It’s easy to do, and indeed the Treasury Department has a web page explaining how to do that.

But that’s just the beginning of his hypocrisy. As Jacoby notes:
Buffett isn’t greedy. He is an extraordinary philanthropist who has undertaken to give 99 percent of his immense fortune to charity, and who, with Bill Gates, actively encourages other billionaires to spend down half or more of their wealth in charitable donations.

And why is he giving all that money to charity instead of to Uncle Sam? Because, as he has said in interviews, he knows it will do more good that way and be used more effectively. Who would disagree? For all Buffett’s talk of being undertaxed, he believes what nearly everyone believes — that he can allocate his money more wisely than the government. And not just that he can, but that he should.
Indeed, Buffett has said:
Well, that’s a choice and it’s an option that... If I had to give it to a single individual, or make some young Buffett a multi-billionaire, or give it to the government, I’d absolutely give it to the government. I think that on balance the Gates Foundation, my daughter’s foundation, my two sons’ foundations, will do a better job with lower administrative costs and better selection of beneficiaries than the government.
Of course, there is one final form of hypocrisy that Buffett is engaged in.

By demanding that the rich be taxed at a higher rate, he becomes the darling of the liberals. The mainstream media dote over him. He is treated like some maverick who has put the interests of the country ahead of his own interests, and the interests of his social class.

Yet Buffett knows that Republicans in Congress will protect him (and other rich people) from the higher tax rates that he endorses! So he gets the best of both worlds: he is a hero to the liberals, and he still gets to keep his money — or dispose of it exactly as he chooses.

As Jacoby puts it:
When the Sage of Omaha calls for higher taxes, his words get plenty of attention. But his actions speak louder, and convey a markedly different message.
Buffett, in other words, is an example of the corruption that ensues when class warfare becomes a normal sort of politics.

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1 Comments:

Blogger Marek said...

Also in Buffett's claim was that capital gains allocated via carried interest should not be taxed at lower rates. While most people in the business of buying and selling businesses have organized themselves as partnerships to take advantage of capital gains rates via carried interest, Buffett's company is a corporation, which gets taxed once before he gets his low rate of qualified dividends. I would hope his claim that any income allocated via carried interest needs to be taxed at ordinary rates as part of his rich-should-pay-more argument is not just an attempt to level the playing field by reaching into the pockets of his competitors.

5:24 AM  

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