Warren Buffets Challenge to Republicans

[wellendowed1911]

I seriously doubt Republicans will answer the challenge- the challenge is Buffet will donate or match every dollar senate republicans donate to bringing down the debt- remember Republicans said we shouldn't raise taxes on millionaires and even went as far as saying if Buffet was so concerned with the debt he could "write and donate" a check to help pay own the deficit. Buffet said he would donate $3 to every $1 Mitch McConnell will donate- I don't expect Buffet to donate any money because the Republicans in the Senate won't answer the challenge.

http://finance.yahoo.com/news/buffet...211046623.html

[CuteOldGuy]

Stupid publicity stunt. Buffett doesn't have enough money to make even a small dent in the debt, and neither do the Republicans. It's the SPENDING, Stupid!

[i'va biggen]

Right when they cut spending on education they will all be as stupid as you are.

[Laz]

Originally Posted by CuteOldGuy

Stupid publicity stunt. Buffett doesn't have enough money to make even a small dent in the debt, and neither do the Republicans. It's the SPENDING, Stupid!

Basic math. What a concept.

[JD Barleycorn]

Don't you understand the stupidity going on here. McConnell is worth about $10 million and Buffet is worth what...$47 billion. To be fair Buffet should be offering to contribute about $4700 to McConnell's one. Then again, Buffet still has a tax bill outstanding for the last three years.

[TexTushHog]

So yeah, they aren't going to take him up on it, is that what y'all are saying??

[CuteOldGuy]

Why should they? It's a publicity stunt, and not serious. If Buffett is concerned, he can bring his own tax liability up to date, and donate whatever will make him quit feeling guilty.

[JD Barleycorn]

I'm saying that Buffet ought to make it 4700 to 1 just to be fair about it. Anything less is not honest. Then again, what's stopping Buffet from doing the right thing (according to him).?

[TexTushHog]

So that's a "No, we're not giving a dime or our money to reduce the deficit"? That's why they want to tax the poor instead, right!!!

[CuteOldGuy]

Red Herring, TTH. You know better than that. No one brought up taxing the poor, you just made that up.

[Jackie S]

Warren Buffet simply needs to fire all of his Tax Attoneys and Accountants, and do a short form IRS filing.
That's what I do.

[TexTushHog]

Originally Posted by CuteOldGuy

Red Herring, TTH. You know better than that. No one brought up taxing the poor, you just made that up.

So the rich Republicans aren't going to pay, now the poor aren't going to pay according to you. Who is going to pay? But Republicans are against the deficit, right?

[Fast Gunn]

Warren Buffet could buy you and sell you a thousand times over out of pocket change so I would not dismiss his ability so blithely.

What he is doing is symbolic and I admire him for it.

. . . A man like Buffet can start a tidal wave and the get the economy moving in the right direction.

Originally Posted by CuteOldGuy

Stupid publicity stunt. Buffett doesn't have enough money to make even a small dent in the debt, and neither do the Republicans. It's the SPENDING, Stupid!

[JD Barleycorn]

They could take every penny that Buffet has and run the government for about a day.

[Texas Contrarian]

Many of the tax-related arguments made by and on behalf of Warren Buffett are silly and disingenuous. Buffett has absolutely no intention of forking over significantly more money to the Treasury, and under neither the "millionaire's tax" proposal, nor any other tax increase proposal currently contemplated, will he risk being burdened with the obligation of doing any such thing.

A lot of people think Buffett only benefits from the preferential tax treatment of capital gains and qualified dividends (top rate of 15% instead of 35%), but are unaware of the fantastic tax-shelter benefits offered by the holding company dividend exclusion on corporate taxation -- and Buffett has made full use of those for many years.

In a nutshell, here's how it works: If Berkshire Hathaway owns an 80% or greater stake in a dividend-paying corporation, the latter can upstream cash to BH, which enjoys a 100% exclusion on its corporate income tax return. Even if BH owns only a 20% or greater stake, it enjoys an exclusion of up to 80%, meaning that in a de facto sense, it would be paying tax at a maximum rate of 7%, since the top corporate rate is 35%. Of course, in the real world, it may not even pay effective tax rates in that range, since there are typically so many deductions and exclusions. Since BH owns large shares of a number of firms, this is a very important consideration and has allowed it to be a very effective wealth-building "compounding machine" for decades. (Note: Even with all these loopholes, Berkshire Hathaway has been engaged in a long dispute with the Treasury over alleged corporate tax liabilities from earlier in the last decade.)

If Buffett really wanted to pay more tax, he would own stock worth several tens of billions of dollars personally, or in some sort of agency account such that he would be liable for the full 15% tax on all qualified dividends. If, for instance, he owned $40 billion of stock paying more or less typical dividend yields, he might have an annual tax bill of something like $100-150 million, instead of the roughly $7 million stated last summer in his op-ed piece for The New York Times.

In the aggregate, BH has also has also made several times more money for its investors than for Buffett. Good for him; he has created great wealth for others, including millions of people with pension and 401K plans. And Buffett has also stated publicly that virtually all of his wealth will go to charitable foundations with a "better range of beneficiaries" than the federal government. It's hard to argue with him there.

But even given all that, you may reasonably argue that Warren Buffett and Berkshire Hathaway (indirectly) pay tax at a much higher rate than most people think because of considerations such as double taxation and what economists and tax experts refer to as "tax incidence."

It's just that neither he nor the holding company write checks to the Treasury for more than a very tiny percentage of aggregate net worth accumulation, and that is not going to change.