Warren Buffett Would Like to Pay More Taxes, Please
Warren Buffett took to the pages of The New York Times this weekend to proclaim his desire to pay more taxes, something he has done many times over the years.
Of course, he's welcome to send a check to the Bureau of the Public Debt anytime.
But when Warren Buffett says he should pay more taxes, he actually means he'd like the people he amusingly refers to as his "mega-rich friends" to join him as well.
Many of his arguments for taxing the rich are standard stuff, but he does make one interesting point from personal experience that's worth chewing on:
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.
In response to the column, the Washington Examiner's Tim Carney writes that:
Buffett Profits from Taxes He Supports
Buffett regularly lobbies for higher estate taxes. He also has repeatedly bought up family businesses forced to sell because the heirs' death-tax bill exceeded the business's liquid assets. He owns life insurance companies that rely on the death tax in order to sell their estate-planning businesses.
Buffett Profits from Government Spending
Buffett made about a billion dollars off of the Wall Street bailout by investing in Goldman Sachs on the assumption Uncle Sam would bail it out. He also is planning investments in ethanol giant ADM and government-contracting leviathan General Dynamics.
As always, Carney is doing the Lord's work digging up gotchas on the big business-big government beat, but I'm wary taking that line of reasoning too far—probably because I've had the barrel of that particular gun pointed at me one too many times. Self-interest may be a factor in Buffett's position, but it's more likely that Buffett genuinely believes raising taxes on the rich would be a good policy decision—in the same way that many people who don't stand to benefit from high estate taxes and Wall Street bailouts do.
Of course, Reason has a long history of disagreeing with Buffett about the advisability of/need for increased taxes on the rich. Read lots here.