Uber-wealthy Warren Buffet is going public with his admonition that the “rich” should pay more in taxes.
“If anything, taxes for the lower and middle class and maybe even the upper middle class should even probably be cut further,” Buffett said in an interview with ABC’s “This Week With Christiane Amanpour” that is scheduled to air on Nov. 28. “But 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.”
This is music to a progressive liberal’s ears.
But despite the seeming altruism of this kind of statement, it’s ain’t gonna happen any time soon. Why? Because Warren Buffet and every other mega-wealthy American knows something the rest of us don’t.
The second richest man in America (third richest in the world) and others in that rarified sanctum reserved for the mega-rich tie up their money in non-taxable trust funds. In fact, 90% of Buffet’s money is in the Bill & Melinda Gates Foundation Asset Trust. The rest of the money Buffet lives on comes from capital gains and is therefore taxed at the capital gains tax rate. Translation for those of us who are more financially feeble-minded: Buffet’s income is NOT taxed as regular (“earned”) income.
So why not just raise the tax rate on capital gains? It’s a good and logical question but no one in their right mind is going to jack the tax rate on capital gains too high because doing this would hit the middle-income folks who are dependent on the income from their IRAs and 401ks.
So in what is perhaps the most hilarious of hypocrisies, even if “income” tax was raised to to 90%, Mr. Noble Buffet would still only pay capital gains tax, not “earned income” tax.
Huge difference, dear readers. And the little lefty drones don’t have a clue.