Monday, August 15, 2011
Our leaders have asked for “shared sacrifice.” But when they did the asking, they spared me. I checked with my mega-rich friends to learn what pain they were expecting. They, too, were left untouched.
While the poor and middle class fight for us in Afghanistan, and while most Americans struggle to make ends meet, we mega-rich continue to get our extraordinary tax breaks. Some of us are investment managers who earn billions from our daily labors but are allowed to classify our income as “carried interest,” thereby getting a bargain 15% tax rate. Others own stock index futures for 10 minutes and have 60% of their gain taxed at 15%, as if they’d been long-term investors.
These and other blessings are showered upon us by legislators in Washington who feel compelled to protect us, much as if we were spotted owls or some other endangered species. It’s nice to have friends in high places.
Last year my federal tax bill — the income tax I paid, as well as payroll taxes paid by me and on my behalf — was $6,938,744. That sounds like a lot of money. But what I paid was only 17.4% of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33% to 41% and averaged 36%. ...
Since 1992, the IRS has compiled data from the returns of the 400 Americans reporting the largest income. In 1992, the top 400 had aggregate taxable income of $16.9 billion and paid federal taxes of 29.2% on that sum. In 2008, the aggregate income of the highest 400 had soared to $90.9 billion — a staggering $227.4 million on average — but the rate paid had fallen to 21.5%. ...
I would leave rates for 99.7% of taxpayers unchanged and continue the current 2-percentage-point reduction in the employee contribution to the payroll tax. This cut helps the poor and the middle class, who need every break they can get.
But for those making more than $1 million — there were 236,883 such households in 2009 — I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains. And for those who make $10 million or more — there were 8,274 in 2009 — I would suggest an additional increase in rate.
My friends and I have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice.
(Hat Tip: Francine Lipman.) Press and blogosphere commentary:
- The Atlantic, Should Billionaires Pay Lower Taxes Than You Do?
- Bloomberg, Buffett Calls for Tax Hike on ‘Coddled’ Billionaires
- Forbes, Warren Buffett's Very Strange Tax Argument
- Going Concern, Grover Norquist Has a Sternly Worded Tweet for Warren Buffett
- The Hill, Warren Buffett: Increase My Taxes
- Legal Insurrection, Warren Buffett's Rank Demagoguery on FICA
- News Busters, Pat Buchanan Challenges Warren Buffett: 'Set an Example and Send a Check for $5 Billion to the Federal Government'
- Politico, Bloggers to Warren Buffett: Pay Up!
- Reuters, Obama Says Warren Buffett Is Right About Taxes
- Start Making Sense, Warren Buffett on Taxing the Rich
- Tax Policy Blog, Warren Buffett's Call for Higher Taxes on the Rich Doesn’t Fit the Facts