http://www.huffingtonpost.com/2010/11/21/warren-buffett-paying-more-taxes_n_786516.html Warren Buffett: Trickle-Down Theory Has Failed WASHINGTON -- Billionaire Warren Buffett rebutted claims that the Obama administration is unjustly hurting business orders with high taxes by saying that in fact, the wealthy have never had it so good. "I think that people at the high end, people like myself, should be paying a lot more in taxes. We have it better than we've ever had it," he told ABC's Christiane Amanpour in a clip played on "This Week" on Sunday. When Amanpour pointed to critics' claims that the very wealthy need tax cuts to spur business and capitalism, Buffett replied, "The rich are always going to say that, you know, 'Just give us more money, and we'll go out and spend more, and then it will all trickle down to the rest of you.' But that has not worked the last 10 years, and I hope the American public is catching on."
Warren Buffett: I 'Should Be Paying A Lot More In Taxes' Then why doesn't he voluntarily do so? If he thinks he should, no one is stopping him, most certainly not the IRS. FWIW: "People on the high end like myself" include him and about 5 other people on Earth.
Citizens who wish to make a general donation to the U.S. government may send contributions to a specific account called "Gifts to the United States." This account was established in 1843 to accept gifts, such as bequests, from individuals wishing to express their patriotism to the United States. Money deposited into this account is for general use by the federal government and can be available for budget needs. These contributions are considered an unconditional gift to the government. Financial gifts can be made by check or money order payable to the United States Treasury and mailed to the address below. Gifts to the United States U.S. Department of the Treasury Credit Accounting Branch 3700 East-West Highway, Room 622D Hyattsville, MD 20782
I believe I read that Buffet and a few other billionaires recently gave billions to charity. Anyone but government is a better recipient, right? Anyway, he's correct. When the rich finally got on board in the late 30's, they helped to pull the US out of its mess. Taxes remained high on the top earners for decades after that, and coupled with redistributive policies largely driven by unions, the middle class exploded and grew to an unprecedented size, making the US the mightiest productive engine the globe had ever seen. Your objections are merely ideological, you will not be affected by higher taxes on the top earners, because if you were a top earner you would not be here.
So Buffet rambles on about needing higher taxes going to the government but rather than write the IRS a check he gives it to charities. Thereby giving himself a tax deduction - so he can pay less taxes. Gotcha!
1. The US did not prosper in the 1950s-1960s because of high taxes, but rather because of the aftermath of WWII. The period of 1945-1965 established the US as the leading manufacturing country in the world, not because of our manufacturing prowess, but rather because of our military might. At the end of WWII, the US had 5% of the world's population and almost 70% of the world's intact manufacturing and transportation infrastructure because most of Europe and Asia had been bombed to ashes during the war. For about 20 years, the US had the highest manufacturing price/wage structure in the world, from which the American middle class benefited greatly. By the mid-1960s, the rest of the world had rebuilt and the US had to actually compete against countries like Japan and Germany. Our market dominance began to erode in the 1970s, and the erosion increased in velocity during the 1980-90s as India and China entered the world markets. When hundreds of millions of people enter the global manufacturing workforce and are willing to work for fifty cents an hour, wages are going to fall, manufacturing is going migrate, and there's nothing anybody can do to stop it. It's inevitable that the economies of China and India will overtake the US because China's population is 4X the US and India is 3X. It's simple math, the economic forces of gravity in action. 2. Though once there were "published" tax rates of 70-91%, very few ever paid taxes at those rates. Back then, there was something called "leveraged non-recourse tax shelters" that wealthy people used to eliminate as much as two-thirds of their tax burden. In addition, most very wealthy individuals kept a large percentage of their wealth offshore (e.g. Switzerland) where it was hidden from the IRS. A study by the IRS in 2003 showed that the richest people in the country paid about 23% of their income in federal taxes during those high tax rate periods (1950s-1960s). In the 1960s, Kennedy lowered tax rates; then Reagan further lowered the rates and also eliminated most tax shelters. In recent years, the tax benefits of offshore banking have been all but been eliminated. 3. People often argue about taxing the rich, but they seldom want to define what rich means. Everyone agrees that Warren Buffet is rich, but is a small-business owner who makes $500k per year really rich? I'm amused by the number of people who claim that the high tax rates of the 1950s kicked in at $200k per year, and therefore $200k per year defines rich. They don't stop to consider that $200k in 1955 is the equivalent of about $3 million in today's dollars. (Back in the 1950s you could buy a house in Beverly Hills for $80k or a new Cadillac for $3k.) So the question remains: What does "rich" mean?