# Warren Buffet weighs in on tax cuts and supply side economics **URL:** \ **Category:** Great Debates\ **Created:** [November 21, 2010, 11:39pm UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487 "2010-11-21T23:39:38Z")\ **Posts on this page:** 20\ **Page:** 4
**Author:** ![IdahoMauleMan](https://avatars.discourse-cdn.com/v4/letter/i/71c47a/32.png) [@IdahoMauleMan](https://boards.straightdope.com/u/IdahoMauleMan)\ **Post date:** [November 22, 2010, 3:41am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/61 "2010-11-22T03:41:27Z")
> [@Chronos](#): > > See, **IdahoMuleMan** , the point you’re missing here is that we live in a society. You’d think that’d be obvious, given that we’re talking about government policy and governments are one manifestation of society, but apparently it’s not. Because once you acknowledge the existence of a society, then Buffet’s argument suddenly makes sense. > > And while you’re at it, you’re right that there are steps Buffet could take to increase the amount of tax he pays. One step that he could take is to lobby the government for an increase in the tax rate. And lo and behold, he’s doing that! I acknowledge the existence of a society. I still think his argument is extremely disingenuous. ---
**Author:** ![Voyager](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/voyager/32/133_2.png) [@Voyager](https://boards.straightdope.com/u/Voyager)\ **Post date:** [November 22, 2010, 3:48am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/62 "2010-11-22T03:48:40Z")
> [@IdahoMauleMan](#): > > Here’s a link from the Economist. A fairly reliable source. > > [http://www.economist.com/node/12608223?story\_id=12608223](http://www.economist.com/node/12608223?story_id=12608223) > > Half of $50Bn is $25Bn, which means the average tax liability is $173m for each of those 144,000. That sounds like a s\*\*\*load, but my guess is that the distribution within that group itself is also skewed. > > There are probably a few multi-billionaires at the top who paid in the $Bn’s, most likely from capital gains or investment income. And it looks like a Pareto chart after that, I suspect. The Economist does say that, with no cite, but they must be wrong. From [here](http://www.ftb.ca.gov/forms/catxrate_exmpt07.shtml) we see the maximum California tax rate is 9.3%. This means that on average these guys would have income of $1.7 billion - assuming no tax shelters, and the like. Now, the income of Silicon Valley CEOs gets printed each year in the Murky News, and it is never even close to this - even at the top. Income from stock options is included in those tallies. It is true that thinks to Prop 13 income taxes are more of the state income than they should be, which is one of the things that led to the giant drop in revenue over the past few years. ---
**Author:** ![Fear\_Itself](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/fear_itself/32/19637_2.png) [@Fear\_Itself](https://boards.straightdope.com/u/Fear_Itself)\ **Post date:** [November 22, 2010, 3:50am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/63 "2010-11-22T03:50:33Z")
> [@IdahoMauleMan](#): > > Because it would suggest more strongly that he actually believes it himself, rather than just pontificating on what others should do. If he really wanted it to happen he can certainly afford to lead by example. Do you think those who complain about socialism should give back their Social Security checks and Medicare benefits? ---
**Author:** ![yorick73](https://avatars.discourse-cdn.com/v4/letter/y/b5a626/32.png) [@yorick73](https://boards.straightdope.com/u/yorick73)\ **Post date:** [November 22, 2010, 3:57am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/64 "2010-11-22T03:57:33Z")
> [@Lobohan](#): > > You will note that Buffet is willing to join. > > Again, you are attempting a snarky jibe, not suggesting policy. Was I supposed to be suggesting policy? Here’s one…tell the government to quit spending so much so that they can keep the tax rates low. How’s that? And, remember, expenses always grow to meet income. So, regardless of the amount of taxes taken in it will never be enough. ---
**Author:** ![Ludovic](https://avatars.discourse-cdn.com/v4/letter/l/7ab992/32.png) [@Ludovic](https://boards.straightdope.com/u/Ludovic)\ **Post date:** [November 22, 2010, 3:58am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/65 "2010-11-22T03:58:37Z")
> [@Fear\_Itself](#): > > Do you think those who complain about socialism should give back their Social Security checks and Medicare benefits? Or ALL government money that you are given without working for. To those that say me and warren buffett should go first, I say how’s that corporate-welfary, keep-goverment-hands-off-my-medicare-thingy working out for you? ---
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [November 22, 2010, 4:15am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/66 "2010-11-22T04:15:27Z")
> [@yorick73](#): > > Was I supposed to be suggesting policy? Here’s one…tell the government to quit spending so much so that they can keep the tax rates low. How’s that? And, remember, expenses always grow to meet income. So, regardless of the amount of taxes taken in it will never be enough. Then explain the surplus during Clinton. Your mantra works for the Repubs quite well though if you add spending much more than you take in. ---
**Author:** ![waterj2](https://avatars.discourse-cdn.com/v4/letter/w/858c86/32.png) [@waterj2](https://boards.straightdope.com/u/waterj2)\ **Post date:** [November 22, 2010, 5:07am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/67 "2010-11-22T05:07:34Z")
> [@Voyager](#): > > The Economist does say that, with no cite, but they must be wrong. From [here](http://www.ftb.ca.gov/forms/catxrate_exmpt07.shtml) we see the maximum California tax rate is 9.3%. This means that on average these guys would have income of $1.7 billion - assuming no tax shelters, and the like. Now, the income of Silicon Valley CEOs gets printed each year in the Murky News, and it is never even close to this - even at the top. Income from stock options is included in those tallies. I think he was off by a factor of a thousand. I get $173,000 as 1/144,000th of $25B. ---
**Author:** ![IdahoMauleMan](https://avatars.discourse-cdn.com/v4/letter/i/71c47a/32.png) [@IdahoMauleMan](https://boards.straightdope.com/u/IdahoMauleMan)\ **Post date:** [November 22, 2010, 5:23am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/68 "2010-11-22T05:23:35Z")
> [@waterj2](#): > > I think he was off by a factor of a thousand. I get $173,000 as 1/144,000th of $25B. Whoops. Nice job. To put that in context, here’s a nice link that shows returns from the highest tax-paying zip codes in the US. > **[100 highest tax-paying (per return) zip codes in the United States](https://wealth.mongabay.com/tables/100_high_tax-1000.html)** Now this is _federal_ taxes, mind you, so you have to knock them down by a factor of 2 or 3, I would guess, for the state tax liability. The first ranking California zip code is 90067 with 2,832 taxpayers paying an average of $199,358 in federal taxes. This is only for zip codes that had at least 1,000 filers. If you click on the “All” link to go to smaller codes, you will see smaller populations in California that paid, on average, much more. Seems plausible that when you sum it all up, there are 144,000 taxpayers in CA paying an average of $173,000 in taxes. ---
**Author:** ![Damuri\_Ajashi](https://avatars.discourse-cdn.com/v4/letter/d/898d66/32.png) [@Damuri\_Ajashi](https://boards.straightdope.com/u/Damuri_Ajashi)\ **Post date:** [November 22, 2010, 5:24am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/69 "2010-11-22T05:24:51Z")
> [@IdahoMauleMan](#): > > He can stop itemizing next year, which he is most certainly doing if he is only paying a 17.7% effective rate. > > He can probably take steps to declare a bunch of dividend, capital-gains and investment income as ordinary wage income. > > Those two things right off the bat would bump up his effective rate to the mid-30s, at least. With very little effort. It would actually make filing his taxes easier, to boot. > > Let’s see if he and Mr. Gates, Sr. do that. Shall we? I think you are missing the point. Are you seriously arguing that anyone that thinks taxes should be higher should just pay more taxes? Its a pretty bulletproof argument, it right up there with “I know you are but what am I?” We don’t think taxes should be higher because we are masochists, we think taxes should be higher because we cannot balance the budget without increased taxes and for a loooong laundry list of reasons, those taxes should fall disproportionately on the shoulders of those of us who make more money. ---
**Author:** ![IdahoMauleMan](https://avatars.discourse-cdn.com/v4/letter/i/71c47a/32.png) [@IdahoMauleMan](https://boards.straightdope.com/u/IdahoMauleMan)\ **Post date:** [November 22, 2010, 5:26am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/70 "2010-11-22T05:26:22Z")
> [@Damuri\_Ajashi](#): > > I think you are missing the point. > > Are you seriously arguing that anyone that thinks taxes should be higher should just pay more taxes? Its a pretty bulletproof argument, it right up there with “I know you are but what am I?” > > We don’t think taxes should be higher because we are masochists, we think taxes should be higher because we cannot balance the budget without increased taxes and for a loooong laundry list of reasons, those taxes should fall disproportionately on the shoulders of those of us who make more money. Yes, I am seriously arguing that anyone that thinks taxes should be higher should pay more taxes. ---
**Author:** ![Tom\_Tildrum](https://avatars.discourse-cdn.com/v4/letter/t/e95f7d/32.png) [@Tom\_Tildrum](https://boards.straightdope.com/u/Tom_Tildrum)\ **Post date:** [November 22, 2010, 6:01am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/71 "2010-11-22T06:01:01Z")
> [@Raygun99](#): > > They’re doing both. They’re encouraging billionaires to [donate half their wealth](http://www.calgaryherald.com/life/Billionaires+join+Buffett+Gates+Club+agree+donate+half+their+wealth/3358553/story.html) to charities in their wills. Buffett is planning on going further than that, to 99 per cent. Thereby minimizing the estate tax. Look, it’s great that he’s giving to charity, but he’s still taking affirmative steps to keep as much of his money as possible in private hands. And extolling the benefit of the estate tax as a check against wealth accumulation while turning over his fortune to the control of the richest man in the world seems almost like absurdist humor. ---
**Author:** ![yorick73](https://avatars.discourse-cdn.com/v4/letter/y/b5a626/32.png) [@yorick73](https://boards.straightdope.com/u/yorick73)\ **Post date:** [November 22, 2010, 6:40am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/72 "2010-11-22T06:40:05Z")
> [@gonzomax](#): > > Then explain the surplus during Clinton. Your mantra works for the Repubs quite well though if you add spending much more than you take in. There was no surplus. Even if there was, the Republicans controlled the house where, as you know, spending bills arise. ---
**Author:** ![Lobohan](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/lobohan/32/79_2.png) [@Lobohan](https://boards.straightdope.com/u/Lobohan)\ **Post date:** [November 22, 2010, 6:46am UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/73 "2010-11-22T06:46:21Z")
> [@Tom\_Tildrum](#): > > Thereby minimizing the estate tax. Look, it’s great that he’s giving to charity, but he’s still taking affirmative steps to keep as much of his money as possible in private hands. And extolling the benefit of the estate tax as a check against wealth accumulation while turning over his fortune to the control of the richest man in the world seems almost like absurdist humor. What’s absurd is the level of discourse the right can muster at this point. “He should send his own money off to the IRS!” Isn’t an argument. It’s an exultation that a half-wit would make and feel smugly proud of. Buffet thinks the rich should be taxed more. He’s more than willing to pay that extra tax. Anyone levying a charge of hypocrisy against him has nothing to offer a reasonable debate. ---
**Author:** ![Dangerosa](https://avatars.discourse-cdn.com/v4/letter/d/22d042/32.png) [@Dangerosa](https://boards.straightdope.com/u/Dangerosa)\ **Post date:** [November 22, 2010, 12:52pm UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/74 "2010-11-22T12:52:07Z")
> [@IdahoMauleMan](#): > > He can abstain from itemizing. > > He can turn over his investment portofolio more frequently and pay short-term, instead of long-term, capital gains. > > He can buy government bonds and burn them. I think. I’m not sure what would happent to the coupon payments or principal repayment. He could probably buy government bonds, and then ask a courier to drop them in Tim Geithner’s mailbox without a return address. Or he could buy government bonds, and then burn the coupon payment checks. > > He can burn his Social Security checks. Although I think he already donates these checks to charity. Another example of how he likes control over his own resources, but thinks others should have it extracted from them by the government. > > Am I’m sure, that if he really really wanted to, he could make a few phone calls and figure out how to contribute to the US Treasury. Something tells me that it is far from an impossibility for a man of his prestige and influence to figure this out. His investment portfolio is mostly Berkshire Hathaway. Turning it over would not be in the best interest of his shareholders. Nor would it be good for the economy in general as stock market churns are not stable long term, and what Warren does, other people follow. Even if what he does is stupid. People won’t understand that he’s churning to get short term gains and pay more taxes. It isn’t the itemizing, its the capital gains. He gets hit with AMT anyway, which would limit his itemizing. The problem is is that the tax system is really set up so guys like Buffet simply have a lower rate. He does donate his ss checks to charity. And maybe he can donate to the U.S. Treasury. Last I checked, you couldn’t do so. But you cannot simply “pay more taxes.” ---
**Author:** ![wmfellows](https://avatars.discourse-cdn.com/v4/letter/w/c2a13f/32.png) [@wmfellows](https://boards.straightdope.com/u/wmfellows)\ **Post date:** [November 22, 2010, 1:36pm UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/75 "2010-11-22T13:36:02Z")
> [@IdahoMauleMan](#): > > He can turn over his investment portofolio more frequently and pay short-term, instead of long-term, capital gains. [etc] These statements fairly indicate you’re engaging in a fairly silly form of ad hominem attack on the messenger (Buffet) rather than making a serious argument. Quite queer, but then I do recall that the Bolshy Left got themselves also tied up into similar ad hominem arguments when someone of a favoured class ‘needed’ attacking. It’s quite bizarre nevertheless to argue someone should take portfolio actions that are deliberately irrational simply to churn money for the Revenue service. ---
**Author:** ![HMS\_Irruncible](https://sea3.discourse-cdn.com/straightdope/user_avatar/boards.straightdope.com/hms_irruncible/32/7394_2.png) [@HMS\_Irruncible](https://boards.straightdope.com/u/HMS_Irruncible)\ **Post date:** [November 22, 2010, 2:03pm UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/76 "2010-11-22T14:03:59Z")
> [@IdahoMauleMan](#): > > He can buy government bonds and burn them. I think. I’m not sure what would happent to the coupon payments or principal repayment. He could probably buy government bonds, and then ask a courier to drop them in Tim Geithner’s mailbox without a return address. Or he could buy government bonds, and then burn the coupon payment checks. > > He can burn his Social Security checks. Although I think he already donates these checks to charity. None of these things is “paying more taxes”, as I’m sure you understand, so this is a dishonest argument. > [@](#): > > Another example of how he likes control over his own resources, but thinks others should have it extracted from them by the government. Buffett is not proposing that he himself should be exempt in any way from what he’s proposing, so again, not a very honest argument on your part. ---
**Author:** ![Rand\_Rover](https://avatars.discourse-cdn.com/v4/letter/r/db5fbb/32.png) [@Rand\_Rover](https://boards.straightdope.com/u/Rand_Rover)\ **Post date:** [November 22, 2010, 4:06pm UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/77 "2010-11-22T16:06:23Z")
> [@Lobohan](#): > > What’s absurd is the level of discourse the right can muster at this point. What’s more absurd is the left’s level of discourse. You are saying “a rich guy wants to increase taxes on te rich, therefore increasing taxes on the rich is a good idea.” It’s basically the same thing as arguing that god exists by saying that Einstein believed in god. ---
**Author:** ![Really\_Not\_All\_That\_Bright](https://avatars.discourse-cdn.com/v4/letter/r/e8c25b/32.png) [@Really\_Not\_All\_That\_Bright](https://boards.straightdope.com/u/Really_Not_All_That_Bright)\ **Post date:** [November 22, 2010, 4:20pm UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/78 "2010-11-22T16:20:35Z")
> [@IdahoMauleMan](#): > > I read an article a short while back, which I’m searching for at the moment, that said that $1 billion in New York State taxes was collected from just 300 upper-income households in Manhattan. Better hope they don’t move to Florida. > > Steeply progressive tax structures are extremely volatile in terms of the revenue they generate. They feel great in good times, but fall apart in flat-to-declining times. The latter of which we are experiencing right now. Who hopes they don’t move to Florida? Florida, with an “all Republican, all the time” legislature and state house and a per capita budget deficit larger than New York’s? ---
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [November 22, 2010, 4:22pm UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/79 "2010-11-22T16:22:12Z")
> [@yorick73](#): > > There was no surplus. Even if there was, the Republicans controlled the house where, as you know, spending bills arise. The president sets the agenda. He determines policy and the economic policies. The house votes on them. When Bush saw the surplus ,he decided to give it to his rich brethren. Who could stop him? They voted as many tax cuts for the wealthy as they could, and now they fight hard to keep them. You should turn Fox off some times. ---
**Author:** ![gonzomax](https://avatars.discourse-cdn.com/v4/letter/g/e8c25b/32.png) [@gonzomax](https://boards.straightdope.com/u/gonzomax)\ **Post date:** [November 22, 2010, 4:30pm UTC](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487/80 "2010-11-22T16:30:11Z")
> [@Rand\_Rover](#): > > What’s more absurd is the left’s level of discourse. You are saying “a rich guy wants to increase taxes on te rich, therefore increasing taxes on the rich is a good idea.” > > It’s basically the same thing as arguing that god exists by saying that Einstein believed in god. That is absolutely not the argument. The rich and respected guy does not say his taxes are unfairly low. He says all the taxes for the rich are. He does not claim jacking his taxes up will solve the problem, in spite of childish bickering in this thread that distorts the argument. When he says it is class warfare, you should be able to understand he is speaking for the whole group of rich who are not paying proper taxes. The point is we have a huge deficit. The money has been stripped out of the middle class and moved into the piggy banks of the very wealthy. If you want to get revenue to stop the bleeding, that is where you have to go.They are sitting on trillions and and trickle down has been proven to be a failure. [Previous page](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487.md?page=3) [Next page](https://boards.straightdope.com/t/warren-buffet-weighs-in-on-tax-cuts-and-supply-side-economics/561487.md?page=5)