News Is America Coddling the Super-Rich?

[Lapidus]

http://www.nytimes.com/2011/08/15/opinion/stop-coddling-the-super-rich.html?_r=2&src=me&ref=general

 

[drankin]

Dave Ramsey was talking about this on his radio show recently. Dave is no Buffet as far as wealth but probably makes a year what Buffet pays in taxes.

He said something to the effect, "Mr. Buffet, if you feel that you aren't being taxed enough, write the US government a check. They WILL take your money. But mind your own business."

But, I'm sure there are some ridiculous loop-holes we can plug for sanity.

 

[jtbell]

One person's "ridiculous loop-hole" is another person's "vital to the national interest."

(And the other person often has a lot of lobbying money behind him.)

 

[WhoWee]

I've posted this before. Warren Buffet seems to have a political agenda as he doesn't mention the $Billions his company, Berkshire Hathaway, pays in taxes - in addition to his personal taxes. It's unusual for a business owner (someone who built the company from the ground up - not a hired hand) not to consider all of the taxes they pay.

 

[Norman]

I've posted this before. Warren Buffet seems to have a political agenda as he doesn't mention the $Billions his company, Berkshire Hathaway, pays in taxes - in addition to his personal taxes. It's unusual for a business owner (someone who built the company from the ground up - not a hired hand) not to consider all of the taxes they pay.

But that has absolutely nothing to do with the point he is making about personal tax. His point was about personal tax right? (I am not being sarcastic - I read this in snippets between work conversations).

I do find his point about the affects of taxing the rich on the psychology of the middle and working classes.

 

[Jack21222]

I've posted this before. Warren Buffet seems to have a political agenda as he doesn't mention the $Billions his company, Berkshire Hathaway, pays in taxes - in addition to his personal taxes. It's unusual for a business owner (someone who built the company from the ground up - not a hired hand) not to consider all of the taxes they pay.

When Congress wanted to raise personal income taxes on rich people, conservatives rose up and said this would hurt businesses, not realizing there is a difference between business profit and personal income of the owner.

Here, too, you're confusing the two.

 

[russ_watters]

When Congress wanted to raise personal income taxes on rich people, conservatives rose up and said this would hurt businesses, not realizing there is a difference between business profit and personal income of the owner.

Here, too, you're confusing the two.

That's not true. Like with the split payroll tax, who pays the tax is just a political gimick, not an economic reality.

 

[russ_watters]

I definitely think a graduated capital gains tax would be a good way to ensure that those who'se normal income is derived from capital gains are taxed appropriately while avoiding penalizing those who invested for retirement, kid's college, etc. I agree with him that that's a flaw in the tax structure. However, I wouldn't make a change until after the economy has shown a stable recovery.

However, most of the rest of that op/ed is highly disingenuous to the point of dishonesty for someone who knows better. He's championed the argument that he pays less % than his secretary in income taxes (here, it's just 'the people in his office'), but:

1. We don't know the incomes of the people in his office. Does anyone actually believe any of them are below the top 20% of wage earners (except, possibly, the janitor - if he even has one on staff)? They are anything but typical/average American workers.

2. All of the non-rich will receive vastly larger benefits from the payroll taxes than him as a fraction of income. The normal calculus of net taxes paid includes the subtraction of benefits, but only for this year. His argument belies the fact that over their lifetimes, his workers are almost certainly net beneficiaries (of payroll taxes) while he's almost certainly a net payer. I wish someone would do a study of overall lifetime net financial contribution to government, because the way the stats are generated now are misleading - and, frankly, insulting if you're a person counted as being a non-contributor while you're only temporarily unemployed. Consier that a person who had a $250k job last year and got laid off might have been seen as "rich", this year he's living a wealthy lifestyle off his checking account, but is considered a poor, non-contributor, and next year perhaps he'll have a new $250k job and be rich again. The stats paint an inaccurate picture of what his real contributions are.

3. He knows enough economics to know that there is no cutoff point in supply and demand below which people buy and above which people don't. For him to say that higher taxes isn't a disincentive to investment is just simply a lie.

4. He's absolutely right that he and his other billionaire friends wouldn't be noticeably hurt by an increase in capital gains taxes. The people who get hurt aren't the 'already rich', but rather the 'trying to become rich' (and even the 'trying to retire comfortably'). He wraps his argument in dishonest false self deprecation: What he's trying to convey as charitable equanimity smells more to me like veiled 'old-money' snobbery. That last part, of course, is pure opinion, though it isn't mine originally - I got it from an op-ed I read a month ago that I'll see if I can find...

 

[RudedawgCDN]

Supply Side economics doesn't work.

What works is full employment.

When I'm making money I don't mind paying taxes - I understand that having roads, police, teachers, firefighters = taxes.

Give businesses incentives to keep their money here, their workers here, their plants here - watch employment go up - and then none of this matters.

 

[mheslep]

...

4. He's absolutely right that he and his other billionaire friends wouldn't be noticeably hurt by an increase in capital gains taxes. The people who get hurt aren't the 'already rich', but rather the 'trying to become rich' ...

Right, and it is also beside the point whether the individual rich guy is 'hurt' from a macro standpoint. Unless Buffet and the like are literally putting their income under the mattress, they are placing large parts of it in securities, new businesses, i.e. investment, aka the 'I' in the GDP equation. Indeed one can argue Warren Buffet places his investment dollars more thoughtfully than any other human, one heck of a good reason to not send it off to the IRS instead.

 

[WhoWee]

When Congress wanted to raise personal income taxes on rich people, conservatives rose up and said this would hurt businesses, not realizing there is a difference between business profit and personal income of the owner.

Here, too, you're confusing the two.

How do you separate a man and his company - when these are the stats - he is the one confusing the two - IMO.
http://xfinity.comcast.net/slideshow/finance-topcompanytaxes/berkshire-hathaway/

"8. Berkshire Hathaway
Pretax income: $19 billion

Provision for income taxes: $5.6 billion

Net income: $13 billion

Tax rate: 29 percent

Warren Buffett's empire filed 14,097 pages of tax returns last year. The Oracle of Omaha has for years pushed for higher taxes on the rich, lamenting that his tax rate is lower than his secretary's. "

 

[Willowz]

3. He knows enough economics to know that there is no cutoff point in supply and demand below which people buy and above which people don't. For him to say that higher taxes isn't a disincentive to investment is just simply a lie.

A lie? It's a face value statement.

4. He's absolutely right that he and his other billionaire friends wouldn't be noticeably hurt by an increase in capital gains taxes. The people who get hurt aren't the 'already rich', but rather the 'trying to become rich' (and even the 'trying to retire comfortably'). He wraps his argument in dishonest false self deprecation: What he's trying to convey as charitable equanimity smells more to me like veiled 'old-money' snobbery. That last part, of course, is pure opinion, though it isn't mine originally - I got it from an op-ed I read a month ago that I'll see if I can find...

Aren't you referring to the middle class in "trying to become rich"? Precisely the people whom he mentioned need helping out??

 

[Ivan Seeking]

How do you separate a man and his company -

What are you talking about? Corporate vs personal income?

Beyond that, even for an inc., taxable income has no absolute meaning. It depends as much on deductions as it does income. Being an MBA you know that so I don't understand your point here.

 

[WhoWee]

What are you talking about? Corporate vs personal income?

Beyond that, even for an inc., taxable income has no absolute meaning. It depends as much on deductions as it does income. Being an MBA you know that so I don't understand your point here.

STOP! I'm not arguing corporate versus personal tax status and you know it.

I responded to a suggestion that I'm confusing the issue. It's my contention that Buffet built his company from scratch and the company pays $Billions in taxes - if the company wasn't paying those taxes - he would be paying more. His argument is intended to make it appear his (poor little hourly wage secretary) pays more than (rich old him) pays in taxes - and it's laughable.

 

[Lapidus]

Right, and it is also beside the point whether the individual rich guy is 'hurt' from a macro standpoint. Unless Buffet and the like are literally putting their income under the mattress, they are placing large parts of it in securities, new businesses, i.e. investment, aka the 'I' in the GDP equation. Indeed one can argue Warren Buffet places his investment dollars more thoughtfully than any other human, one heck of a good reason to not send it off to the IRS instead.

You should write him an email and point that to him out.

Or, you just might again read what he wrote. For your convenience I quote him for you in bold

I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

Also, I think we had clarified that before here on PF on some other thread: big companies, banks and funds are indeed putting there money under the mattress right now. Their hesitance to invest has zero do to with taxes too high, but with the very little business oppurtunities and dim economic outlook.

How low do you want to cut taxes so that people will invest? No taxes? Perhaps paying them to invest? Lower wages, too?

 

[WhoWee]

You should write him an email and point that to him out.

Or, you just might again read what he wrote. For your convenience I quote him for you in bold

I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

Also, I think we had clarified that before here on PF on some other thread: big companies, banks and funds are indeed putting there money under the mattress right now. Their hesitance to invest has zero do to with taxes too high, but with the very little business oppurtunities and dim economic outlook.

How low do you want to cut taxes so that people will invest? No taxes? Perhaps paying them to invest? Lower wages, too?

Has anyone on PF ever read a business plan or Private Placement document that did not include a projection of taxes? Has anyone ever made an investment decision that didn't consider tax consequences? Does anyone believe that Berkshire Hathaway does not factor in tax implications when it considers a merger or acquisition? My earlier post cited "Warren Buffett's empire filed 14,097 pages of tax returns last year." - is it possible taxes were not considered?

Again - you can not separate the man from his company in this discussion.

This is a list of private holdings - follow the links for additional holdings.
http://www.berkshirehathaway.com/subs/sublinks.html

 

[CAC1001]

I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off.

John Rutledge, who was one of the principle architects of the Reagan economic plan, seems to refute Buffett's claim: http://www.rutledgecapital.com/Articles/20040611_the_real_reaganomics.htm

Note how he points out that investors tended to keep a lot more money in tax shelters but with the tax rate cuts, much more of it began moving into the stock and bond markets. When Labour instituted tax rates up around 90% in the UK during the 70s, it scared off investors as well. The 1970s were a point of virtually zero construction of new mansions in the UK at the time, because no one could really make any money to become wealthy.

And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

This one just baffles me. Is Mr. Buffett forgetting what happened in between 1980 and 2000? We saw some very large tax cuts occur under Ronald Reagan. We saw a tax increase under George H. W. Bush, and one under Bill Clinton, but we also saw a capital gains tax rate cut under Clinton as well. Overall, between 1980 and 2000 was a period of tax cuts and low taxes, and we experienced some of the most vibrant economic growth in the country's history. The 2000s are more complex, because of the housing bubble that messed everything up.

I wouldn't say tax cuts always mean great job growth or that tax increases will automatically kill job growth, but when taxes get punitively high, they do hurt job creation and economic growth.

 

[WhoWee]

John Rutledge, who was one of the principle architects of the Reagan economic plan, seems to refute Buffett's claim: http://www.rutledgecapital.com/Articles/20040611_the_real_reaganomics.htm

Note how he points out that investors tended to keep a lot more money in tax shelters but with the tax rate cuts, much more of it began moving into the stock and bond markets. When Labour instituted tax rates up around 90% in the UK during the 70s, it scared off investors as well. The 1970s were a point of virtually zero construction of new mansions in the UK at the time, because no one could really make any money to become wealthy.

This one just baffles me. Is Mr. Buffett forgetting what happened in between 1980 and 2000? We saw some very large tax cuts occur under Ronald Reagan. We saw a tax increase under George H. W. Bush, and one under Bill Clinton, but we also saw a capital gains tax rate cut under Clinton as well. Overall, between 1980 and 2000 was a period of tax cuts and low taxes, and we experienced some of the most vibrant economic growth in the country's history. The 2000s are more complex, because of the housing bubble that messed everything up.

I wouldn't say tax cuts always mean great job growth or that tax increases will automatically kill job growth, but when taxes get punitively high, they do hurt job creation and economic growth.

The entire capital leasing industry is focused on tax implications on investments.

Further, take a quick look at KPMG's website to understand the tax implications on investment decisions.
my bold
http://www.kpmg.com/global/en/whatwedo/tax/mergersacquisitions/pages/default.aspx

"Why tax-efficient mergers and acquisitions matter
Companies with global ambitions cannot afford to ignore the opportunities for profitable growth offered by mergers, acquisitions and disposals. But if these transactions are to create real value, it is important that the tax implications of each deal are dealt with from the outset. This is especially important in cross-border deals, where differing regulations and business cultures need to be reconciled in order to reveal the risks and opportunities of a transaction.

Similarly, private equity seeking to increase return on investment cannot afford to ignore tax. Recent trends show that M&A transactions have become more international and deal volumes have increased tremendously. Highly-leveraged transactions allow for big ticket deals, in particular within the private equity market."

 

[mheslep]

You should write him an email and point that to him out.

Or, you just might again read what he wrote. For your convenience I quote him for you in bold

I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

That's about incentive to invest again, another issue and misses my point about allocation: whatever the tax rate, the money that goes to taxes does not go to private investment. If the tax rate is, say 50%, five of ten dollars goes to the government and can not be invested by Buffet regardless of his incentives.

Also, I think we had clarified that before here on PF on some other thread: big companies, banks and funds are indeed putting there money under the mattress right now.

First, we clarified no such thing. Second, the OP here is about taxes on individuals such as Buffet. Nobody is talking about raising the business tax.

 

[WhoWee]

First, we clarified no such thing. Second, the OP here is about taxes on individuals such as Buffet."

Actually, there is no one else in the US that is just like Buffet - is there?

Bill Gates has a higher net worth - but it wasn't accumulated primarily through Mergers and Acquisitions -it's primarily from MicroSoft valuation - is't it?

http://www.forbes.com/wealth/billionaires/list
"The venerable investor's Berkshire Hathaway climbed more than 15% over the last year adding $3 billion to his to fortune. The 80-year-old is still hunting big deals: "Our elephant gun has been reloaded, and my trigger finger is itchy." Along with bridge partner Bill Gates, the Oracle of Omaha is coaxing America's richest to pledge half their fortunes to charity."

He apparently can't give his money away fast enough - perhaps he thinks the Government can speed things up?

 

[russ_watters]

A lie? It's a face value statement.

I don't see a disagreement there. Yes, it is a face value statement. It's clear, concise, and simple and it clearly violates perhaps the most basic concept in economics. This is just my opinion, but I don't see how it could be possible for someone like him to not know this. So that means he must be purposely trying to deceive us.

Aren't you referring to the middle class in "trying to become rich"? Precisely the people whom he mentioned need helping out??

Raising taxes on the rich does not help out the 'everyone else'. He explicitly stated he wants to change nothing for the 'everyone else'. What he's calling 'helping out' is actually just not changing the 'helping out' that Obama and Bush already did.

 

[DevilsAvocado]

I wouldn't say tax cuts always mean great job growth or that tax increases will automatically kill job growth, but when taxes get punitively high, they do hurt job creation and economic growth.

In theory, maybe yes, in practice – I say it all depends on how you do it. If you do investments in infrastructure, education, research, new technology, startups, etc – high taxes can actually mean a growing economy.

I can’t help laughing when I see (the same old freaks) going baloney over taxes, as it was some form of communist virus from hell.

I live in a country which has one of the highest taxes in the world, as a percentage of GDP:

As you can see, we have twice as much tax revenues as the United States, TWICE!

Do we walk around in Karl Marx beards and fight over the one and only loaf in the supermarket?

No.

At the moment, we are http://en.wikipedia.org/wiki/EU_economy#Economies_of_member_states", 5.54% annual change of GDP, and United States has 2.8%.

This means you have a *HUGE* opportunity (i.e. margin) to fix your economy in a fairly simple way, if you could just relax a little bit, and realize that taxes are not equal to Stalinism.


... and if I just may add; you have http://en.wikipedia.org/wiki/Health_care_system#Cross-country_comparisons", 17% of GDP and growing:

If you fix the healthcare and make it more effective and thus cheaper, raise some to taxes to fix your public debt, do some cuts (in maybe some 'overkill' in the military), and skip stupid gazillionaire benefits like tax reduction for private jets – you’re are going to do JUST FINE!

Piece of cake!

 

[russ_watters]

You should write him an email and point that to him out.

Or, you just might again read what he wrote. For your convenience I quote him for you in bold

...I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off.

He's arguing against the law of supply and demand. Incentives and disincentives are the positive and negative of the same thing. They are both quite real and they both really do work.

Consider the following scenario: You have some money in the stock market and are nearing retirement. You plan to take quite a bit of money out when you retire. Capital gains taxes are about to rise a lot. Do you keep your money in the stock market or take it out early? Some people will elect to take it out early.

Cash for clunkers and the new homebuyer credits worked similarly and their effects - though temporary - were well documented.

Also, imagine you're a casual trader who has short term investments. The fact that the capital gains tax is lower than income taxes provides an incentive for keeping your money in the market and in an individual stock for longer than a year. Remove that incentive and some people may trade more, increasing volatility and potentially removing money from the market.

And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

Does anyone not see the deception in that part? It's terrible! He's whitewashing the primary component of the Reagan legacy (which both sides of the aisle agree on!)!

Also, I think we had clarified that before here on PF on some other thread: big companies, banks and funds are indeed putting there money under the mattress right now. Their hesitance to invest has zero do to with taxes too high, but with the very little business oppurtunities and dim economic outlook.

I don't know why you bring that up - this isn't about business investment, but personal investment.

How low do you want to cut taxes so that people will invest? No taxes? Perhaps paying them to invest? Lower wages, too?

Who said anything about cutting taxes? This is about whether or not to raise taxes. That's a red-herring argument.

 

[WhoWee]

How low do you want to cut taxes so that people will invest? No taxes? Perhaps paying them to invest?

Isn't this the specific basis and intent of President Obama's tax policy - to cut payroll taxes for 95% of all workers - so they invest in the economy? Doesn't the EITC (tax redistribution) program give money to low income families - so they can invest in the economy?

 

[mheslep]

If you fix the healthcare and make it more effective and thus cheaper,

Yes US healthcare is too expensive, due to government intervention in the market in my opinion. US medicine also yields considerably better medical outcomes than Europe, which is a fact.

 

[Willowz]

Raising taxes on the rich does not help out the 'everyone else'. He explicitly stated he wants to change nothing for the 'everyone else'. What he's calling 'helping out' is actually just not changing the 'helping out' that Obama and Bush already did.

Mis-wording on my part there. But, I don't understand what you meant by "trying to get rich" not benefiting from Buffet's proposal. I think you meant "the already rich" would not benefit.

 

[Physics-Learner]

once again, the answer is simple - get rid of most of govt. it is the root cause of most all of our problems.

 

[DevilsAvocado]

Yes US healthcare is too expensive, due to government intervention in the market in my opinion. US medicine also yields considerably better medical outcomes than Europe, which is a fact.

Really? That’s not what I have heard:

Life Expectancy vs Health Care Spending in 2007 for OECD Countries. The data source is http://www.oecd.org

Do you have another source?

 

[DevilsAvocado]

once again, the answer is simple - get rid of most of govt. it is the root cause of most all of our problems.

I know exactly what you mean. Somalia is a financial paradise.

 

[lisab]

once again, the answer is simple - get rid of most of govt. it is the root cause of most all of our problems.

Very simplistic world view, IMO.

 

[Physics-Learner]

Very simplistic world view, IMO.

as mr. spock would say - "why, thank you".

 

[russ_watters]

Really? That’s not what I have heard:

Life Expectancy vs Health Care Spending in 2007 for OECD Countries. The data source is http://www.oecd.org

Do you have another source?

There couldn't be a less reliable stat than life expectancy on that issue. Cultural and government bias issues play such a huge role that the relatively tiny differences are swamped by the noise.

 

[WhoWee]

I'm going to re-post and hi-lite with bold the important point:

"http://www.forbes.com/wealth/billionaires/list
"The venerable investor's Berkshire Hathaway climbed more than 15% over the last year adding $3 billion to his to fortune. The 80-year-old is still hunting big deals: "Our elephant gun has been reloaded, and my trigger finger is itchy." Along with bridge partner Bill Gates, the Oracle of Omaha is coaxing America's richest to pledge half their fortunes to charity.""

This man is on a mission to give his fortune away - his comments about higher taxes on the wealthy should be kept in context with this important stipulation.

 

[Greg Bernhardt]

I was thinkin, if he wants to pay more taxes, why doesn't he just write a check to the US Treasury?

 

[Physics-Learner]

choose whatever you want. i will supply you with a statistic to back it up.

 

[Amp1]

I haven't finished reading this thread but who-wee from post #14 insists Warren's company as opposed to the man pays billions in taxes. I wonder if its billions a year, every ten years, a decade, what is the amount his company pays per year? How much would it be without the tax accountants? Maybe his accounts are not as good as G.E.'s and that's why his company pays BILLIONS probably.

 

[mheslep]

Really? That’s not what I have heard:
...

Do you have another source?

For instance:
http://v1.theglobeandmail.com/v5/content/pdf/CONCORD.pdf, Figure 1, page 11. Or google medical outcomes for various medical treatments of disease, traumatic injury, waiting times for operations, etc, i.e. actual metrics of the medical system.

There couldn't be a less reliable stat than life expectancy on that issue. Cultural and government bias issues play such a huge role that the relatively tiny differences are swamped by the noise.

Yep. If one doesn't get killed at 23 in, say, a car wreck or by gunshot then US lifespan looks pretty good.

 

[CAC1001]

In theory, maybe yes, in practice – I say it all depends on how you do it. If you do investments in infrastructure, education, research, new technology, startups, etc – high taxes can actually mean a growing economy.

The thing is, we already pretty much have all of that. We aren't an under-developed country. We have lots of infrastructure as is, it just needs repairing. Education, we are at a point where we tend to just be spending more and more money at something growing more and more problematic. Research, well we've done that for years and continue to do so.

I can’t help laughing when I see (the same old freaks) going baloney over taxes, as it was some form of communist virus from hell.

It is when they are used to spend the nation into oblivion and for purposes of wealth redistribution.

I live in a country which has one of the highest taxes in the world, as a percentage of GDP:

As you can see, we have twice as much tax revenues as the United States, TWICE!

Do we walk around in Karl Marx beards and fight over the one and only loaf in the supermarket?

No.

You have a a smarter government there that is wiser with its fiscal policy.

At the moment, we are http://en.wikipedia.org/wiki/EU_economy#Economies_of_member_states", 5.54% annual change of GDP, and United States has 2.8%.

This means you have a *HUGE* opportunity (i.e. margin) to fix your economy in a fairly simple way, if you could just relax a little bit, and realize that taxes are not equal to Stalinism.

The view that raising taxes will fix the USA's problems is just as simplistic as the view that the solution is to massively reduce the size of the government. As for Sweden itself, you're talking about a country much different to a country like the U.S. One big difference is that Sweden has a relatively efficient government with fairly low levels of corruption. Usually countries with high levels of social trust have decent public institutions, and Sweden is just such a country. The thing is that the conditions for having such a high-level of trust in a society are that it usually is relatively homogenous ethnically, religiously, linguisticallly, etc...and rather small. Sweden has a little less than 10 million people. You'll find about that same amount in either Los Angeles or New York City alone over here in the states. And if you notice, cities like LA and NY are not ethnically, religiously, linguistically, homogenous, but instead are a whole mix of those things, which has created all sorts of complexities within those cities over the years. Comparing Sweden to a nation like the United States which is immensely more complex in terms of the mix of cultures, ethnicities, religions, languages, and so forth, with a population of more than 300 million people, well it's just not a proper comparison.

Really? That’s not what I have heard:

Life Expectancy vs Health Care Spending in 2007 for OECD Countries. The data source is http://www.oecd.org

Life expectancy unto itself is inaccurate, because America has two major causes of deaths: car accidents and homicides (much of which take place in our inner-cities, which tend to be governed by very far-Left politicians). You have to compare life expectancy based on the quality of the healthcare system alone, not just the life expectancy overall, so that would mean removing the deaths from auto accidents and homicides. There are other problems with measuring these things as well.

EDIT: mheslep beat me to it

 

[WhoWee]

I haven't finished reading this thread but who-wee from post #14 insists Warren's company as opposed to the man pays billions in taxes. I wonder if its billions a year, every ten years, a decade, what is the amount his company pays per year? How much would it be without the tax accountants? Maybe his accounts are not as good as G.E.'s and that's why his company pays BILLIONS probably.

A real quick search - the numbers look a bit high - $30 Billion in taxes paid from 2002 through 2010.

****
For years 2002, 2003, and 2004 - Berkshire Hathaway paid $7.337Billion - see page 69.
http://www.sec.gov/Archives/edgar/data/1067983/000095012905002423/a06623e10vk.htm

------------------------

For Years 2006, 2007, 2008, 2009, and 2010 - see page 105 - it income taxes total $23.222Billion.

http://www.berkshirehathaway.com/2010ar/201010-K.pdf

*********
Interestingly, given the total is about $30Billion (not counting 2005) for years 2002 - 2010 - I found this article - apparently, he'll receive about $30Billion in tax credits for giving away his shares. my bold
http://www.nytimes.com/2006/06/27/business/27berkshire.html

"Tax experts said the charitable gift essentially provides $30 billion in income tax credits — something that Mr. Buffett is unlikely to use in his lifetime. It will also allow him to avoid about $4.5 billion in capital gains tax. And giving away the shares will also help avoid taxes on his estate. Estate planning experts called it a simple and pragmatic approach, true to form for Mr. Buffett."

 

[MarcoD]

Comparing Sweden to a nation like the United States which is immensely more complex in terms of the mix of cultures, ethnicities, religions, languages, and so forth, with a population of more than 300 million people, well it's just not a proper comparison.

I agree with that. But sometimes conservatives in the US state postulates as if they are axioms. Sweden has 50% taxation, a 33% GDP government deficit, and 33% of the population is employed by the government - and the country works.

If you borrow 40 cents on the dollar, everybody know you need to cut spending and increase revenue. It is a no-brainer.

Whatever, Sweden is a socialist country in US terms, and the US is an experiment in anarchy in EU terms. To each it's own.

 

[Amp1]

Thanks, Who-wee. So his multi-billion $ company pays ~ 4 billion a year give or take. Thats out of (rough addition of nets) ~ 463 billion over the same period of time. So the company still netted after tax revenue of ~ 430 billion, not bad.

 

[CAC1001]

I agree with that. But sometimes conservatives in the US state postulates as if they are axioms. Sweden has 50% taxation, a 33% GDP government deficit, and 33% of the population is employed by the government - and the country works.

Well I think the U.S. government is something like 40% of the U.S. GDP in terms of its spending at least.

If you borrow 40 cents on the dollar, everybody know you need to cut spending and increase revenue. It is a no-brainer.

Yeah, but that's like saying if you want a yacht, all you need to do is make more money, it's a no-brainer. I mean YEAH, but the big problem is how to go about cutting spending and how to go about increasing revenue.

Whatever, Sweden is a socialist country in US terms, and the US is an experiment in anarchy in EU terms. To each it's own.

I wouldn't call Sweden "socialist" so much as a social democracy.

 

[WhoWee]

Thanks, Who-wee. So his multi-billion $ company pays ~ 4 billion a year give or take. Thats out of (rough addition of nets) ~ 463 billion over the same period of time. So the company still netted after tax revenue of ~ 430 billion, not bad.

The $463Billion might be revenues. The earnings from years 2002-2004 total $19.745B and 2006 - 2010 total $42.244B = total earnings $61.989 Billion. I also noticed in the 02-04 filing an entry for approximately $20Billion in deferred tax liability on page 55. Again, the $30B sounded a little high (on $62B in earnings) - but the consolidated financials are very complicated (and I took a real quick look).

 

[Physics-Learner]

well, we could raise taxes on the rich. or .. we could raise taxes on the middle class, so that the rich could provide us jobs. or .. we could cut spending. or .. we could better our infrastructure. or.. or..

i forgot - that is what we have been doing and talking about for the past 100 years.

the only thing i wonder about is will people ever get smart enough to realize the graft, corruption, complications, and total inefficiency of their govt ! now that is the 64,000 dollar question.

i digress - keep on discussing what the govt should do next - LOL.

 

[DevilsAvocado]

There couldn't be a less reliable stat than life expectancy on that issue. Cultural and government bias issues play such a huge role that the relatively tiny differences are swamped by the noise.

Eh... government bias issues...?

Look, I’m not pointing any fingers here, I’m just saying that you have the most expensive healthcare in the world, and that maybe you can do something about it. mheslep thought that the explanation for this is because U.S. "yields considerably better medical outcomes" and that this "is a fact".

My point is that if you spend between 100% and 50% more on healthcare then all the other countries in OECD, and if what mheslep say is true (that you do better), one would not expect U.S. to be behind when it comes life expectancy, right?

Please, check the http://en.wikipedia.org/wiki/Health_care_systems#Cross-country_comparisons" again. U.S. is not best at Life expectancy, Infant mortality, Physicians per 1000 people, Nurses per 1000 people. You are only best when it comes to costs...

But okay, let’s say this is "noisy & biased", how about http://en.wikipedia.org/wiki/WHO%27s_ranking_of_health_care_systems" ? Of 190 countries, U.S. has the highest expenditure per capita, but you’re only ranked as 37 compared to other health systems around the world.

Is this "noisy & biased" too??

I know this a 'hot potato', but wouldn’t it be wise to at least acknowledge that you’ve got a problem* there? That could probably be solved (just steal everything from #1 France! ;) and you would save A LOT of budget money!


*probably administrative overhead

 

[DevilsAvocado]

For instance:
http://v1.theglobeandmail.com/v5/content/pdf/CONCORD.pdf, Figure 1, page 11.

Okay, I see U.S. on top in only one of these tables, and we are talking a few %... and U.S. has costs between 100% and 50% more compared to others...

See my previous post.

 

[DevilsAvocado]

The thing is, we already pretty much have all of that. We aren't an under-developed country.

Oh no, that’s not what I meant (sorry if I gave that impression). U.S. is still in many aspects the greatest country in the world, and it would be real sad if that changed in a far too near future. I’m absolutely not 'pointing fingers'...

We have lots of infrastructure as is, it just needs repairing.

Yes I know, but frankly, do you think "repairing" will do it if you want to stay #1?

One of these trains runs on the only "high-speed" rail in U.S. between Boston and D.C. (quotes because the average speed is 68 mph [109 km/h]). It isn’t that hard to tell which is the U.S. train, right?

(The others are Germany, France, Japan and China)

And while you are repairing the "68 mph train", Germany is developing the next generation of magnetic levitation high-speed trains doing 500 km/h (311 mph):

That won’t work, will it?

You have a a smarter government there that is wiser with its fiscal policy.

I’m not sure about that. I’m not saying that this little 'banana republic' of ours is paradise in any way, only that we do things slightly different and it works, sometimes...

The view that raising taxes will fix the USA's problems is just as simplistic as the view that the solution is to massively reduce the size of the government. As for Sweden itself, you're talking about a country much different to a country like the U.S. One big difference is that Sweden has a relatively efficient government with fairly low levels of corruption. Usually countries with high levels of social trust have decent public institutions, and Sweden is just such a country. The thing is that the conditions for having such a high-level of trust in a society are that it usually is relatively homogenous ethnically, religiously, linguisticallly, etc...and rather small. Sweden has a little less than 10 million people. You'll find about that same amount in either Los Angeles or New York City alone over here in the states. And if you notice, cities like LA and NY are not ethnically, religiously, linguistically, homogenous, but instead are a whole mix of those things, which has created all sorts of complexities within those cities over the years. Comparing Sweden to a nation like the United States which is immensely more complex in terms of the mix of cultures, ethnicities, religions, languages, and so forth, with a population of more than 300 million people, well it's just not a proper comparison.

Yes I know you’re right, except maybe for the "relatively homogenous". That’s the old view of "blondes & blue eyes". It isn’t true anymore; we have one city, alone, that has received more refugees from Iraq than the U.S. and Canada, together.

My point is that "taxes will automatically kill you" is maybe not true, depending on how you do it.

Not being an 'expert' in any way, but AFAIK if you 'strangle' the economy in times of none or very low growth, you risk going down in a recession (or worse, real depression) that is not that easy to recover from. This is not any made-up 'fear propaganda' of mine. Listen to what Bruce Bartlett, that held senior policy roles in the Reagan and George H.W. Bush administrations, has to say:

http://economix.blogs.nytimes.com/2011/07/12/are-we-about-to-repeat-the-mistakes-of-1937/"

I have to ask you; what do you expect to happen if (only) large tax cuts are implemented? U.S. companies are sitting on $1.9 trillion right now. Will they start acting if they get $2.9 trillion, $3.9 trillion, $4.9 trillion, or what??

You guys went to the Moon, and there’s apparently a lot to fix in your country, so what are you waiting for, the Moon to fall down??

Come on, I know you guys can do much better than this!

Life expectancy unto itself is inaccurate

See my previous post.

 

[turbo]

One thing that flies under the radar over and over is the hidden, regressive taxes that hit lower wage-earners. It's all well and good to pontificate about marginal rates, capital gains, etc, but let's consider reality with one simple example.

When our government subsidizes the blending of ethanol into our gasoline supply, they are taking after-tax money from all of us tax-payers and giving it to agribusinesses and energy companies. Those big businesses and their investors and lobbyists all benefit. Who pays for those benefits? When farmland is taken out of food production to benefit big businesses, the price of staple foods rise. The price of feed for livestock rises, increasing the price of meats. The price of fuel increases, and fuel-efficiency decreases. People in the lower and middle-income levels cannot escape these hidden taxes. As such they are regressive. Wealthy people do not have to eat more food, nor do they have to buy more gasoline to commute to their jobs. People in low-wage jobs generally cannot escape these hidden taxes, and the people in our government are loathe to admit that such hidden cost shifting is taxation, and is regressive.

 

[WhoWee]

Are we still talking about Warren Buffet and his taxes?

 

[DevilsAvocado]

I agree with that. But sometimes conservatives in the US state postulates as if they are axioms. Sweden has 50% taxation, a 33% GDP government deficit, and 33% of the population is employed by the government - and the country works.

Yup, mostly. (once we had 500% interest rate... )

If you borrow 40 cents on the dollar, everybody know you need to cut spending and increase revenue. It is a no-brainer.

Yup, a no-brainer it is!

Whatever, Sweden is a socialist country in US terms, and the US is an experiment in anarchy in EU terms. To each it's own.

That’s the 'Hollywood version'... actually, in some ways we are more capitalists than you could ever dreamt of – we [the politicians] has 'invested' the whole damned pension system in the stock market, so when the market goes down, so do the (active) pensions.