Filibuster Cartoons
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Claiming it would help slash trillions of dollars from the next decade of deficits, President Obama once again called for increased taxation on America’s wealthiest citizens yesterday, embracing his first major cause of the campaign season. Evoking the name of billionaire Warren Buffett, who, as we all remember, wrote a famous editorial in the New York Times last month scolding politicians to “stop coddling” richies like him, Obama called for raising income taxes on Americans making more than $250,000 a year and proposed hiking taxes on earnings secured through stocks and other investments.
In predictable fashion, the Republicans quickly sprung to the defence of the targeted billionaires, blasting the Obama plan as “class warfare” — their favorite swear word for rich-taxing. But what does “class warfare” even mean? Speaker Boehner described it as “pitting one group of Americans against another,” presumably with torches and pitchforks. Some cartoonists have depicted it as greedy peasants shaking dollar bills from upside-down businessmen. Either way, the term evokes some degree of cruel vindictiveness, or as Paul Ryan put it, championing the “fear, envy and anxiety” of the have-nots at the expense of the haves.
But what’s funny is that a lot of the rich folk in question don’t seem particularly frightened. Many of them are actually downright cool with the Obama plan. Along with Buffett himself, Microsoft chairman Bill Gates, HR Block founder Henry Bloch, former Bear Sterns CEO Ace Greenberg, former MGM chief Harry Sloan, and even noted millionaire creationist comedian Ben Stein have all came out in favor, and one imagines there are lots more to follow. As I’ve noted before, wealth in America actually correlates fairly high with liberalism, and even when it doesn’t, as in the case of Republicans Sloan and Stein, it at least correlates with a high degree of noblesse oblige in matters of taxation. We saw a similar example of this back in 2001, when a bunch of mega-millionaires assembled to denounce the Republican Party’s plan to eliminate the inheritance tax, another rich-targeting program that the rich were more than okay with.
So the politics of the whole thing are more than a little baffling. It’s not at all clear whose water the GOP is carrying by opposing Obama’s call for the rich to pay their “fair share,” other than some very hardcore libertarian ideologues who view all forms of taxation as theft, and all rich folk as Randian supermen who deserve no burden for their success.
To be fair, the current Republican line does shy away from referring to millionaires as such, preferring the label “job creators.” One’s ability to create jobs is directly correlated to the amount of cash in one’s bank account, you see, which does make some sense. Bill Gates could probably hire me to do something tomorrow, if he really wanted. But it’s also true, as The Simpsons taught us, that Mr. Gates did not get rich from writing a lot of cheques, either. Given the choice, folks like him would probably prefer to outsource their errands to some cheap non-union J.J. on a different continent, and pass the savings along to himself. In any case, the American rich are taxed at quite historically low levels already, thanks to President Bush, and that didn’t do much to spare the country from its current doldrums.
Unless we’re still clinging to “trickle down” theories, it seems the most surefire way to create jobs at this point would be to put more cash in the pockets of the lower classes, who actually do the sort of day-to-day retail and service sector shopping that employs people like themselves. In a capitalist system, job creators only create where demand exists, after all. For all the fear-mongering about socialism, it’s the constant expectation that economic prosperity will flow from the elite-down, rather than bottom-up, that truly evokes spectres of a planned economy.
Obama has no-doubt polled his tax-hiking scheme from every angle, and all the available evidence on that front suggests it’s one of the most popular things he could possibly do. So embracing the position is hardly political genius on his part. He’s just lucky he’s got such incompetent opponents.
September 20th, 2011 at 10:41 pm
Another intelligent article. But you may wish to fix the wording in the Buffet quote.
I hear millionaires are notoriously fragile.
September 20th, 2011 at 10:43 pm
I can understand why men such as Mr. Buffett want their taxes raised, but why don't they donate the difference to the U.S. Treasury in the meantime?
September 20th, 2011 at 10:47 pm
Nice article & cartoon! :)
September 20th, 2011 at 10:50 pm
Because it would mean jack shit. He wants taxes to be raised on certain income, which he happens to earn. He doesn't want taxes raised on himself personally. It's like saying that someone who wants a levee to protect the town should be out there with a shovel moving some dirt until the Army Corps of Engineers gets there.
September 20th, 2011 at 10:53 pm
Because they know that actually passing such a bill is highly unlikely, thus it's safe to whine about wanting to pay more without ever having to.
Either that or Buffett's too stupid to know he can just write a check to the IRS. Or not take any deductions.
September 20th, 2011 at 11:11 pm
But he doesn't want to "just write a check to the IRS." He wants a change in policy, not just a meaningless change in his bank accounts.
September 20th, 2011 at 11:17 pm
Buffet's probably the smartest business guy there is. What many non-business people fail to grasp is that he's also very serious about money. Donating money to the government accomplishes nothing, you may as well light it on fire. Basically if Warren Buffet even hints at buying or investing in a company, the market will speculate wildly. Investing in the Government is a money losing venture. He donated 40Billion in Berkshire Hathaway stock http://www.berkshirehathaway.com/donate/webdonat…. to philanthropy foundations.
September 20th, 2011 at 11:33 pm
Investing in the government isn't a money losing venture. If it was, interest rates on Treasury securities wouldn't be so low. (Of course, that means it's not really a huge money-MAKING venture right now, mainly because it's so comparatively great at not being a money-losing venture.)
September 21st, 2011 at 2:00 am
I'm for tax reform that increases revenue, especially from the rich, but there's a big gap between "Americans making more than $250,000 a year" and "billionaires." Small business owners often have their income exaggerated by the taxation rules. My dad owned a construction business and took home something like $40,000/year, but business taxes applied as if his business was worth more than half a million dollars. (Why? Gross instead of net, maybe? I'm no accountant.) Are people like him going to be dragged into this higher tax bracket at the same time we depend on them to bring jobs back to our economy? Why not put the threshold at $750,000 for small business owners? That separates the job creators from the millionaires.
Also, I'd love to see a portrait of "some cheap non-union J.J. on a different continent."
September 21st, 2011 at 6:52 am
The rich don't care about the tax rates because they're highly mobile and good at protecting their assets someplace else.
September 21st, 2011 at 7:29 am
Actually the "Bush tax cuts" increased the percentage the top 1%, top 5%, and top 10% pay in personal income tax while the lowest 50% pay less even down to almost nothing. Warren Buffet is an interesting case as he does not draw much salary instead drawing from investment income. As a side note it seems that his companies owe as much as 900 million to the IRS from back taxes 2002-2006. If I get a dividend from an investment, the company has already paid a corporate income tax of up to 35% on that money and I would get to pay another 10 or 15% also. As it is I pay no federal income tax because Social Security is not taxable unless I earn a certain amount. Warren Buffet and the top 1% of taxpayers pay about 40% of all federal personal income tax, so I thank them for paying my share.
September 21st, 2011 at 7:55 am
Actually, that's what usually happens. People wait for the Corp of Engineers to come, but fill sand bags in the meantime.
September 21st, 2011 at 7:55 am
Changing policy takes time. He can write the check right now.
September 21st, 2011 at 7:56 am
"Donating money to the government accomplishes nothing, you may as well light it on fire."
So, do taxes count in that?
And it's not an investment, it's a donation.
http://www.fms.treas.gov/faq/moretopics_gifts.htm...
September 21st, 2011 at 9:53 am
Because they actually want to tax everyone else, who may be in competition. Buffet himself is imbroiled into a long-standing tax dispute with IRS. It's not like he wants to be taxed in reality. All of that is just a regular ploy by a mega-rich liberal.
September 21st, 2011 at 9:59 am
It's kind of sad that an editorial like that makes you sound like a bleeding heart liberal these days, J.J. The American Right is pretty out there these days.
It's also worth noting that "job creators" don't create jobs based on their personal wealth. There's not a billionaire in the world that can self-support the economy. It's the lower and middle classes that spend in the numbers needed to keep it running.
September 21st, 2011 at 10:10 am
The proportion of income tax revenue that the poorer half of the country pays dropped from 4% in 1999 to 2.7% in 2008. That reinforces the idea that the Bush tax cuts reduced the tax burden on the poor, too. http://ntu.org/tax-basics/who-pays-income-taxes.h...
September 21st, 2011 at 3:07 pm
I think the issue here is that "Rich" is actually labeled to low. I looked around a bit and i'm kinda shocked what passes as middle class american incomes. Most list ~25k to ~115k as middle class income, but I'm left wondering if these numbers are net or gross pay. Also do they include debt payments(not minimum payments, but actually removing debt payments)? Does it include bills? Does it include unexpected expenditure? These things are a heavy burden if you're only making around 30k a year. And this is only if that is net income.
Say someone might be earning 250k yearly, but paying with taxes and paying bills + all the various debt payments having only 75k, for the nearly top of middle class,(??sound good??)in actual money to show for your efforts. Then you'd be middle class living in my book. Since that means you can afford better than the cheapest, but can't spend money on massive frivolous things like a solid gold crapper. Maybe once every few years you buy an expensive item.
Just for a reference, for my opinion. Lower class I'd define as either having 5k, or less, a year in net income (regardless of gross income) after all expenses. You have enough money to buy frugally and only a tiny bit to spend on anything non-essential. Upper class being 100k+ net income after all is said and done. Of course keeping in mind these levels are for the lifestyle and cost of living in the U.S.A., and do NOT include consumer buys like a 60 inch flat screen HD 3D blu-ray/TV/DVD with super computer and a latte.etc etc.
So really if I was
September 21st, 2011 at 3:13 pm
"But what does “class warfare” even mean?"
As the saying goes: it's what they call it when we fight back.
Sometimes, proposals to tax the rich are raised by working class people in the course of (political and economic) interactions with society, as a call for redistribution of wealth. You can argue that the proposals are too timid or too ambitious in different contexts… but actually this is not what is going on here at all.
The reason Obama, and, probably to a greater extent, certain millionaires, are proposing such measures is the converse one: an attempt to pacify or demobilise anger aimed at the elite, anger which could otherwise lead (at the margins or en masse) to strikes, boycotts or outright occupations. Even mulling over the idea buys them time. Others, such as the Republican party, prefer a riskier strategy of stating variously that higher taxes on the rich are some combination of morally wrong, impractical, money-losing for the State, or costly for the economy. You can have lots of arguments about these while at the same time remaining wholly committed to doing what is better for these Great Men of Industry: this is simply a tactical disagreement "within" the class, and will resolve itself in the usual legislative tug-of-war. Of course, this is politics, so the sides will frame it in a way that makes it seem ordinary voters without enormous incomes or hefty investment portfolios nevertheless have more of a stake in their side.
Now that's not to say that the taxes, if they do happen won't have in some sense been 'won' by the protest movements across the US, as they are useful as a demonstration of current and potential anger. But at most, we're probably talking token concessions.
September 21st, 2011 at 3:14 pm
So really if I was* someone earning 250k, but left having 75k left over, and hearing that I was listed as upper class rich. I'd be extremely opposed to anything like that passing.
Course someone might say "How could you turn 250k into 75k?" well. Taxes right now will eat about a third of that 250k, then say you're paying a loan on a small business (they tend to be bigger than mortgages), and paying the usual mortgage, car payment, insurances, utilities, food, gasoline, cloths, etc. Not including savings a lot of your money is already spoken for. If you have any significant savings plan (was it at least 6 months of cost of living to be safe?) at all then you're losing a few thousand more of the total. I feel that having 75k left over is quite generous in that situation.
Course if you're not running a small business on a loan you'll probably be in that "upper class" level I metioned.
September 21st, 2011 at 3:31 pm
Rich people hire poor people. The poor buy things as do the rich. Its a float all economy system that is needed.
Republicans want everyone's taxes to be cut on everyone not just the rich or poor or middle class. You see many Tea Party people wanting to get RID of the income tax. Ron Paul said that the current system is already doing half the job for him as half of Americans don't pay income tax.
Anyone who makes an assumption that demand-side or supply-side economics always works is wrong. Why not just cut taxes for everyone and do both?
The rich creates jobs to sell things that the poor buy but they also creates things that people outside the US buy as well. So yes in exports the rich do provide jobs to the poor and middle class. In domestic sales the poor and middle class still buy a chunk.
It is foolish to assume that to benefit the poor and middle class the way to go is to print out checks and cash and give it to them. The solution is cut taxes, especially for small business, let them keep their own money.
Giving out checks and cash will only create a one wave effect as the money is a limited supply thus a limited effect. Cutting taxes allows people to plan ahead to spend more and keep their own money. Thus a multiple ripple affect.
But go ahead raise the taxes on the rich and see where all their assets end up. Hoover and FDR raised taxes on the rich and the rich ended up paying a smaller percentage of the tax pie as before the tax increases.
September 21st, 2011 at 3:37 pm
"and paying the usual mortgage, car payment, insurances, utilities, food, gasoline, cloths, etc."
Er, no. That's what normal people spend their income on. If you're paying total taxes of 34% on $250k, you pay $85k taxes, and have $165k left over for mortgage/rental payments, loan repayments, transport, fuel, groceries and other expenses. That's quite a lot, in fact it's over three times the US average pre-tax income in 2010, or 5 times what the average person has after tax (even if they're only taxed at 25%). Repaying a loan and, to a certain extent, a mortgage also doubles as savings, as you come out of it with a saleable asset. Your $75k left over, generous or not, is a heck of a lot of 'spare' money. Sure, you might be annoyed that extra taxes might cut into your yacht fund, but you can't say you're losing out on essentials.
September 21st, 2011 at 6:23 pm
"Get me J.J. McCullough!"
"He's unavailable."
"Then get me his non-union Mexican equivalent!"
[later]
"Listen, Señor McCullougho…"
September 21st, 2011 at 7:59 pm
You say it's foolish to print out cheques and cash and give them to the poor and middle class, yet this is precisely what the Australian Government did, the same government whose treasurer just the took out the Euromoney Finance Minister of the Year Award. The Australian Government literally gave people AU$900 and the stimulus helped the country avoid most of the shocks of the GFC. Granted there were other measures taken in addition to this such as increased spending on public infratstructure, but giving money back to people to spend it to buoy consumer confidence and stimulate spending was a major component of a plan that worked. Additionally, stimulus payments are cheaper for a government in the long term, given that taxes are notoriously hard to increase once lifted, just look at this current debate for example.
Also, it is a massive furphy that rich create jobs. Jobs are created by an aspirational middle class.
September 21st, 2011 at 9:01 pm
Historically, though, it would make sense if Republicans supported cheques to the poor, because that's basicall, Social Credit, whose supporters tended to skew conservative.
September 21st, 2011 at 11:24 pm
Is this really so hard to understand? What possible good could it do for him to donate personally to the US treasury? Then, if the tax laws on the rich DO pass, he gets to pay DOUBLE what everyone else will be. How is that fair for him? He wants the higher taxes on the rich so the rich can be taxed EQUALLY, now so specific individuals pay in and the rest keep all they can.
September 22nd, 2011 at 1:49 am
Well, this has been a bit of an eye opener.
Little old me, a full time employee in a medium sized firm making not bad but not spectacular money, is paying 37c in the dollar (in my case, Australian dollars) plus 1.5 Medicare levy.
In contract the HIGHEST income earners in the USA (Mr Buffet included one would imagine) is only paying 35c in the dollar on income and less on capital gains!
Maybe the Wizard of Wichita is right.
September 22nd, 2011 at 2:46 am
It was a poor analogy, that doesn't invalidate the point however.
September 22nd, 2011 at 3:04 am
Unemployment in AU is a lot lower, less debate and way smaller economy and a lot less people. $900 in the AU economy per person is nothing. Including the fact that AU has little illegal immigration and is more homogeneous in nature and less people living off the government.
AU economy need only one small wave. The US needs a tsunami injection of capital to get it going. Only ones that can do it are those that have cash and do it in barrel loads. No matter how much the US taxes, it won't be enough because I highly doubt the US people will allow another few billions to be given directly to companies.
Companies create products, people buy their products, etc. etc. It's a cycle that creates jobs. Giving cash out does not push the cycle from both directions. An across the board tax cut is cheaper and does way more than a stimulus, which was suppose to jump start the US economy with all the money that was spent.
I don't know why the left favors a one time check when if you cut the same amount in taxes it will be wayyyyyy cheaper and do more. because people will spend their own money in things they already need and know how to.
You are saying, spend money filing taxes, then spend money processing the taxes, then spend more money making a rebate, spend money to inform people, then spend money to clear the rebate in the banks. When it would be just cheaper to let the people keep their own money.
How is a tax RATE cut not putting money into people's pockets? Its letting them keep it. It is the same principal as a ridiculous government check. Keeping your own money results in way more economy activity then sending a government check and have people blow it off on some one time deal like a TV or video game. Plus the last time the people got check from the US government many just put it in the bank and sat on it part of it (the people not the companies).
If they kept their money in the first place they would of spent it anyway. Sending out checks is just doing the same except its more expense then a tax rate cut and completely inefficienct.
September 22nd, 2011 at 3:06 am
First people complain that politicians only vote what favors them. Now that Republicans have some backbone and vote how they view is the best for the economy, even if it hurts them in the ballot box, you all criticize them?
September 22nd, 2011 at 3:09 am
It's not true because the rich pay corporate taxes (those that do unlike General Electric who pays nothing and does business with Iran on top of it). They own the companies so the more corporate taxes that are paid the less money they have. Plus all the little taxes the rich pay already that the poor don't in addition to taxes that cities like New York add on top.
Plus go tax investments and see what happens. All the money will go to China. Short term investments are taxed, its the long term investments which have low taxes and most of those probably have taken a major hit as a result of the economy.
September 22nd, 2011 at 3:12 am
He doesn't want to discriminate against himself but what will happen is everyone will take their money to China.
Plus when taxes are raised the rich pay a smaller piece of the tax pie especially in a recession.
September 22nd, 2011 at 3:17 am
To put it in perspective. The rich own a vast majority of the wealth. When the economy tanks who's wealth is hit? Everyone especially those who own the vast majority of it. So they lose a lot of money. The poor and middle class have little to no wealth already so their tax burden stays about the same if they pay any (RELATIVE to the all the tax collected).
The rich just lost a tonnnnnnnnnnnnnnnn of value in their assets which means they are worth less money. If they are worth less money they are paying less in taxes. As a result…. they pay less of the tax pie.
The same goes for when raising taxes. They have less money in order to make money. Thus having are worth less money. Thus less taxes as a whole. See its a cycle.
September 22nd, 2011 at 5:34 am
That's only true of some of the rich, and corporate taxes are pretty low, too (only 9% of US tax revenue).
September 22nd, 2011 at 7:45 am
Precisely. You've gotta love execs like Buffet and Jeffrey Imelt of GE cozying up to Obama, advocating for these tax hikes, when, in the meantime, their corporations owe years and years of back taxes. Can you imagine one of us getting away with 8 years of unpaid taxes like Buffet's Berkshire Hathaway?
If you owe thousands of dollars, you're at the government's mercy. If you owe millions, the government is as yours.
September 22nd, 2011 at 7:47 am
It doesn't make one a bleeding heart liberal, it merely makes one very naive and gullible. If you're willing to swallow Buffet's advocacy for raised taxes, then I've got some acres in Antarctica to sell to you.
September 22nd, 2011 at 8:24 am
Jobs and economic growth are created when someone performs a useful service for someone else. Yes, we could tax the rich and transfer it to the poor to create demand, but that doesn't create wealth. It shifts wealth to people who will use it to take care of short term needs and wants. Once that transferred wealth is gone, the demand is gone, and the job problem remains.
The "tax the rich" side of the argument assumes that the rich will stay here indefinitely and keep producing golden eggs for the government. This might be true for a little bit, but they will eventually pack up and move elsewhere. It's a lot easier for the rich to move than the poor and middle class.
I'm not saying that keeping taxes where they are is going to create jobs, but increasing them isn't going to help either. I think that's what the Republicans are banking on.
September 22nd, 2011 at 9:09 am
Where do you think "transferred wealth" goes? If it's spent in the economy, it continues to circulate. Do you think that, instead of the money spent on goods further enriching the people whom goods are bought from (thus creating jobs through DEMAND?), that it just gets set on fire?
Right now taxes are so low that the rich simply hoard all their cash while demanding the poor sacrifice more. They're not creating jobs, they're cutting corners so they can squeeze out more.
September 22nd, 2011 at 9:11 am
…because their idea of what's best for the economy is "fuck the poor and fuck you if you don't want to?"
September 22nd, 2011 at 10:24 am
The transferred wealth does exactly as you say. It circulates. It probably gets spent on a variety of consumer goods. But that doesn't create wealth or even sustainable demand. Once the transfer ends, the short term demand generated by the transfer also ends. If any jobs were created in this period, that also ends.
I get the idea though. Generate so much consumer demand that corporations will be forced to hire more workers from their cash hoard. But why would you be enthusiastic about hiring people if you know you're taxes are going to go up? Especially if you know that your demand is just being driven by a short term transfer payment.
But who really pays for the tax increase anyway? Let's say we increase taxes on big corporations by 20%. How's the company going to deal with this increase? They're certainly not going to let it affect their profits. They're going to pass that 20% onto the consumer in the form of higher prices. They can get away with this since all their competitors will be forced to do the same. Corporations are really just tax collectors.
September 22nd, 2011 at 5:50 pm
Raising taxes on the top earners would mean just as much jack shit. You could liquidate all holdings of every American millionare and tax them 100% and it would pay about 4 months of deficit spending right now.
http://urbangrounds.com/2011/09/obama-class-warfa... http://urbangrounds.com/wp-content/uploads/buffet...
September 22nd, 2011 at 5:58 pm
Actually it kind of does. Mr. Buffett's potential actions would speak far louder than his current words.
September 22nd, 2011 at 6:00 pm
"Then, if the tax laws on the rich DO pass, he gets to pay DOUBLE what everyone else will be. "
??? If the tax laws pass, I would guess he would stop making donations, as he would pay what he think he owes with taxes alone.
September 22nd, 2011 at 6:31 pm
All the people who are saying that "the rich will leave" are ignoring the inherent benefit of being within the United States. This is why corporate taxes are so high: It's an inherent advantage to be in (most importantly) such a large market, under that system of permissive pro-capitalist laws, and within easy range of a plethora of suppliers for any business.
Living and working in America has its charms. Use the advantages you have. If a Polder-model society like Germany can still keep corporations, rich people, and decent jobs within its borders, the United States can do it as well.
September 22nd, 2011 at 10:05 pm
Fighting the last war….
The arguments and Kenysian assumptions assume a Great Depression situation. We're probably more in an 1880's model. Why is this important? Because of the way taxes work on small businesses in the US.
Raising taxes on 250k plus hits the small business world., This is where "trickle down" works best (BTW the 1980's solutions did seem to work better than our current attempts). Big government requires big corporations to manage. When things collapse the government is best out of the way in order to allow for experimentation to see what makes money. Many of your big corporations are now in a state of slow and prolonged decline. The economy is changing…and I do not believe that these changes are making big government more effective. Do note….small businesses tend to be in the GOP column, while the corporate giants tend to line up more often with the Democrats. You missed one btw…where's Soros?
September 23rd, 2011 at 4:43 am
It is a perfect analogy for how private charity is completely and totally ineffectual in dealing with problems as huge as the US deficit.
September 23rd, 2011 at 8:31 pm
I think that the US is missing a unified goal or direction for the economy to take in order to develop long lasting future growth.
Germany has produced durable goods since the 19th century and that alone has pulled them through two world wars, the loss of half it's territory twice (in 1917 as a result of the treaty of Versailles and in 1945 with Soviet occupation of East Germany). Eastern Europe has followed this model of specialization and for the most part by carving a niche for itself in the European Union rather that trying to directly compete with established manufacturing giants such as Japan, the United States, Canada, France, and recently China.
For the better part o the last 70 years the United States economy has been driven by the need to produce mass quantities of technologically superior goods (mostly weapon related) in order to directly compete with Communist Bloc country's superior production capability.
At the end of the Cold War the vast industrial base that was the American Military Industrial Complex suddenly collapsed overnight and the rise of massive military conglomerates was born as a result of the "Last Supper". A period of mergers, buyouts, and sales that saw the thousands of independent military contractors be reformed into a handful of massive military corporations.
For example in 1985 the five largest military contractors in the united states were
1. Rockwell International
2. Ford Motor Co
3. General Electric
4. McDonnell Douglas
5. Electric Boat Company (subsidiary of General Dynamics)
Today
1. Lockheed Martin
2. Boeing
3. Northrop Grumman
4. General Dynamics
5. Raython
The military industrial complex has grown to the point where it is completely dependent on government contracts to remain functioning. Up till 1972 Hughes Tool Company was the single largest military contractor in the world but it was still owned by one person and most of its revenue came from privet sector sales. After the abrupt end of the Cold War many civil corporations sold off their military divisions to the few defense company's that still had government contracts and exited the market altogether. (Ford being the best example)
On the other hand Boeing which had not produced a single bomber since WW2 bought out it's legendary arch rival McDonnell Douglas in 1997 giving it a monopoly over large aircraft production in the United States and putting it in the prime position to earn government contracts in the Post War on terror Defense boom.
Since 9/11/01 the United States Military has failed to achieve the rearmament of it's land forces, it has failed to deploy new small arms to it's infantry divisions, it has failed to produce an adequate amount of fighter aircraft to replace the Reagan Era legacy force, it has failed to develop any new bomber with sufficient payload or range to carry out strikes against hardened targets, it has failed to even do something as simple as find a replacement or upgrade the M-16 mk 4 even though their are dozens of better options.
What it has accomplished is buy thousands of MRAPS that are useless outside of basic policing patrols, order hundreds of aerial drones that are useless against a capable military or grounded if their is so much as the slight chance of rain on the horizon. It has invested billions of dollars into massive logistical aircraft that will be mothballed at the end of the Afghanistan Intervention. It's Air Defense brigades have been dismantled, traditional weapons platforms retired without replacement, and future major heavy weapons platforms such as the DG1000 destroyer and F-22 fighter cut down to a silver bullet force that will be too small to halt any future Chinese aggression.
Everything the military was planning to build after 2000 was cancelled for the sake of the global war on terror in 2010 while the Third Taiwan Straight Crisis will be met with a whimper in 2020 when the unthinkable happens. The United States goes to war with a major conventional military not some goat farmer in the middle of a landlocked country Americans can't even spell.
September 23rd, 2011 at 8:34 pm
No, he'd be paying at least double, since whatever he paid in already would not count, as it would be a donation, not taxes.
September 24th, 2011 at 5:07 pm
Buffett doesn’t need loopholes. Capital gains are taxed at 15%, while someone working at a good salary is paying 25+%
The nominal corporate tax rate may be 35% but businesses don’t actually pay it; the US takes less in corporate tax than most other countries, in reality.
The Republican/Tea Party eagerness to cut taxes disappeared when Obama proposed extending the payroll tax reduction. For the matter, there’s been a lot of noise from them about how unfair it is that “half of Americans don’t pay income tax”. The GOP just wants to cut taxes for the ultra-rich, really.
Taxes are the lowest they’ve been in decades and the economy was in the doldrums. High income and capital taxes in the 1960s went hand in hand with boom. Bush I raised taxes and Clinton oversaw a tech boom. Bush II cut income and capital gains taxes and we got a housing bubble followed by Great Depression 2.0. The idea that high taxes on the rich inhibits growth is falsified by reality.
Businesses don’t create jobs. Customers for businesses create jobs.
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September 25th, 2011 at 5:09 pm
Guest, if you're paying 37c in the dollar, your income would have to be close to $200kpa, i.e. almost four times the median Australian wage. You'd be better off doing what Buffet and co. do and structure your taxation affairs along the lines of a private company.
September 25th, 2011 at 5:12 pm
Please point out where I criticised Republicans.
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September 25th, 2011 at 6:54 pm
Problem with that……
From 1945-1973 the US was in a unique position due to its successful leadership in WWII. There simply wasn't much competition from a Europe that had just destroyed itself….and there was no other 1st world. The US could be prosperous while doing whatever it damned well pleased from a taxation perspective.
This changed in the mid-70's. (Did anyone hear about Japanese cars, for example prior to around this time?) Other economies got more competitive. Reagan and Thatcher were responding to the changed circumstances when they slashed taxes. It worked for their time.
Fast forward to today. Russia and much of the old USSR have flat taxes. Europe largely has lower corporate rates than America. China is now an economic giant, and has been rising to that status ever since the early 80's. India and other Pacific rim economies are now much more powerful. If you are a business leader you've got options.
If you are making public policy you need to be very careful. I feel that the parties are still stuck on what worked in the past rather than focusing in on today's economy. The Republicans are trying to act as if its 1983, the Democrats are trying to act as if its 1963.
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To be frank, the proposal by Buffet should be half and only the multinational corporations and conglomerates that primarily outsource their labor and resources as with the people earning most of the money from those ventures should be taxed on a higher rate, while companies that employ and create jobs in America should be of a lower tax. It's time we started penalizing the unfair market advantage China and other countries in the global market have with cheap labor for more taxes in the US and increased "homing tariffs" on said companies. Either they adapt and assist in the American situation or we leave the market open for new companies to adapt and try to gain from the situation. It's already been speculated that China has been fixing their currency over the last two decades. We really need to restructure and revitalize how companies are treated here and find the best solution that is permissible.
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October 13th, 2011 at 11:44 am
The "high wage theory" of giving people money that did not earn as well as socialist/Keynesian economics have proven to be utter failures whenever they were tried.
Both President Hoover and FDR believed in "high wage" theory, granted the latter believed in it more. The idea was to give people money — "relief" back in the day or "stimulus" today — and they'll buy stuff and create jobs, etc. However, that just turned a run of the mill depression into a decade-long Great Depression.
What we need is to create an environment where the 1% who have money are encouraged to spend it and invest it so that the 99% who are unemployed and watching their "stimulus" become worthless due to inflation caused by creating "stimulus".
October 28th, 2011 at 1:33 pm
It's quite unfortunate that we're living in what is quite obviously the Vietnam of our time, and will likely become a global revolution, but no one at the top seems to see what's really going on. We're going to move forward, and they will likely be abandoned altogether.