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Veteran Advisor

Re: Hard to argue with

 


@GoredHusker wrote:

First of all, one must really get over the Buffett and his secretary's taxes.  Buffett is paid a wage last I knew of 100K a year.  He's paying every bit as high if not higher tax bracket on this 100K.  The lower percentage that everyone wants to try to put in there is investment income which is income from money already taxed.  This is why investment income has a smaller tax rate.  Take a traditional IRA and a roth IRA into account.  The traditional IRA is tax deferred meaning money going into it isn't taxed.  When the person draws from that account, they are then taxed.  The roth IRA has money going into it that has already been taxed, thus when one draws it out they don't pay any taxes on it.  Maybe roth IRA's should be treated the same as Buffett and Romney's investment income with the 14% rate?  Or, should they just get taxed in whatever bracket they are in even though the money's already been taxed once?  How do you think the middle class would swallow this news?

 

I agree with you on Buffet's personal account, that he pays what is necessary, BUT, if you look into Buffett's business, the IRS says that about a Billion (with a B) of taxes is owed, starting from back over 10 years ago, but his teams of lawyers are fighting it.  Now tell me, if you or I owed any amount of taxes, and didn't pay it for over 10 years, and instead were fighting it, do you really think that we would get by with it?  I'm willing to bet, if I was just $1K short, that there would be no putting it off for 10 years, without some stiff penalties.

I can't prove it, but the rumor on the street is that Buffet is fighting this, with a roomfull of lawyers, with the idea that they will threaten to drag it on to infinity, or 'settle' for a percentage owed.  Just think, how much he could pay his lawyers, if they get the IRS to settle for even 90%, that is still 100 MILLION DOLLARS, he saved.   Why does he, just for being rich, hiring a team of lawyers, and making statements of how he doesn't pay enough in taxes, get away with it?  Neither you, nor I would.

Why can't the law be written simply enough, so that when it says that Buffet's company owes $100 million in taxes a year, it is in a clear-cut manner, that they can't fight for 10+ years?  To me, that says there is a lot of reform that can be done.

 

 

The only reason Buffett wants investors to pay higher rates on investment income is because he wants to be able to write off losses greater than 3K a year.  It would have worked out brilliantly for him a few years back.  He could have manipulated his taxes to the point where he wouldn't have paid a single cent in taxes the past couple of years.  


Agree completely, almost everything that Buffet does, or suggests be done, seems to help the bottom line of Warren Buffet, or BKH, from tax law, to opposing a pipeline that is a direct competitor to his rail lines.
 

I agree there are too many loopholes and special deductions, but I don't agree that they belong to those who are rich from investments.  They belong to each and everyone of us along with every other business out there in terms of accelerated depreciation and such.  I'm getting so sick and tired of reading about all these subsidies certain groups get only to find out that they aren't subsidized but rather get special tax deductions.  Considering roughly 47 percent pay no federal income taxes, it's fairly easy to assume the average Joe isn't adding much to the fed. balance sheet.  


I agree with you there, as well.  I keep hearing about oil company 'subsidies' which are in reality tax breaks.  No different than the guy down the street getting earned income credit, or quick write off of a business asset.  However, I also feel that there is way too much complexity, and too much room for error and manipulation, in our current tax code.  To take Romney as an example, he actually didn't list some of his legal deductions, because that would have dropped him into paying under 10% of his income in taxes, which he dared not do, after saying he paid 13%+ publicly.

 

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Senior Advisor

Re: Hard to argue with

Only in Washington DC is not taxing something considered a subsidy.

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Veteran Advisor

Re: Hard to argue with

Sam, I don't see the American landscape quite as severe as you. I think there is a fair of amount of Americans that fall in the $50,000 to $250,000 income range that do not see themselves as "rich" by any means, and are susceptible to the class envy that Obama tries to foster by pitting them against those "1-3%ers" that supposedly can shoulder the entire utopian scheme. Russ is pointing out that those in this income range are the ones that actually will have to pay the taxes since you can tax 100% of the income over $250,000 and not come close to making a dent in what needs to be done to finance those dreams.

The irony is that the liberals in this range of income are the very ones that will scream the loudest once they realize that they put their own goose in the oven to get cooked. If you have every heard a liberal scream when the taxes they advocate hit home, you know that it is not a pretty sound to experience.

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Senior Advisor

Re: Hard to argue with

Most liberals don't care because they get it back in the form of a salary, health care, and retirement.

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Advisor

Re: Hard to argue with

Wasn't necessarily posing it as purely accurate but, as you say, the percieved reality which is what influences most consumers and voters and such. You've got a hell of a good handle on the financial health and general condition of the tenious "middle class" and I suppose if the inflation that everyone so seems to fear does come it will be because of a bi-partisan policy commitment (fire up the printing press) to honor pensions and savings vehicles and that is a TON of presumed money.  That's when we "become Greece", not when we try to stimulate actual gowth.  But the right has that possibility so bottled up that nobody can even begin to make the necessary distinctions. 

 

All of this tied together with nox's sharp perception on the jobs picture would make one think that there are folks out there who understand the stakes invloved.  But it is impossible to start to address something that is crippled by entrenched power, and owned policy makers, so severely.

 

Talked to a friend this AM who had  gone to hear Andrew Bacevich last night at the U of Missouri.  Said he spoke of the frustrations that come with coming to an understanding of top tier poicy influencing power.  Where to even start?

 

i.e  http://www.lewrockwell.com/blog/lewrw/archives/89700.html

 

The one part of the presentation that he told me about was Bacevich comparing the "citizen's war" (WW2) to what has transpired since...he served in Vietnam and lost a son in Iraq....mentioned to the sizable number of 18-20 yr old students that we'd been perpetually at descrecionary war since they were in the 2nd and 3rd grade. 

 

 

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Advisor

Re: Hard to argue with

Wow, Bruce referencing Lew Rockwell, you can expect quite a pat down the next time you fly.

 

If you liked that you might appreciate last weeks lew on Radio http://www.lewrockwell.com/lewrockwell-show/2012/09/28/311-war-and-the-fed/

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Advisor

Re: Hard to argue with

I was linking Rockwells site.  wasn't refernceing Lew, but more orless Mr.s Moyers, Becovich and Burris.

 

I've been a Lew Rockwell website reader for yeurs.  One of my early on bookmarks.  Lew etal do a good job of allowing and passing along views that aren't all Hayek and Mises, which I  suppose however some of you purified Austrians think that is all that they should.

 

Been many good Paul Craig Roberts links up here over the years.  Many of them from the Rockwell site.  I seem to remember Brent Snowcroft and Chukc Hagel also.  Maybe it was somewhere else, but at a libertarian flagship site.  Lots of Pat Buchanan at Lew over the years, even messy as some of that would be. 

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Senior Advisor

Re: Hard to argue with

I doubt with $140k berkshire shares that buffet has many losses to write off. And he hasn't paid CG taxes on the gains nor have people with IRA's.

 

Another point is businesses could lower their taxes simply by paying their employees a living wage.

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Senior Advisor

Re: Hard to argue with

We become Greece when the majority of the people work for the government and they demand more than the government can provide.

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Veteran Advisor

Re: if the bush cuts expire

Hey, fatlipboy/ollie, how's it going?