Warren Buffett’s Op-Ed in the New York Times this weekend offers some important historical facts and context on how incredibly low average tax rates are for the wealthiest Americans today. Policy rates are low even if the country was experiencing the best of economic times, but is especially indefensible given the past 12 years of mammoth military commitments and corporate bail-outs while average families have lost 40% of their net worth. Unfortunately, paying more to rebuild fiscal health over the next few years is a necessary investment for future strength. The good news is that the country has the resources in its population to do so. It would be a lot darker if this were not the case.
“Between 1951 and 1954, when the capital gains rate was 25 percent and marginal rates on dividends reached 91 percent in extreme cases, I sold securities and did pretty well. In the years from 1956 to 1969, the top marginal rate fell modestly, but was still a lofty 70 percent — and the tax rate on capital gains inched up to 27.5 percent. I was managing funds for investors then. Never did anyone mention taxes as a reason to forgo an investment opportunity that I offered.
Under those burdensome rates, moreover, both employment and the gross domestic product (a measure of the nation’s economic output) increased at a rapid clip. The middle class and the rich alike gained ground.”
The whole article is worth a look, see: A Minimum Tax for the Wealthy.
Here is more of this discussion from The Daily Ticker.
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Nice piece. It feels good to see someone speaks with facts and common sense. BTW, Cory, love your China housing/GDP photo. A picture worth a thousand words… Langley, BC
Good old Warren. Is he still around?
This is all smoke and mirrors… taxing everyone everything they earn won’t be enough to cover the debt. The more the government taxes individuals and corporations the more they destroy the economy – and the less revenue they accrue. Who cares what Warrren Buffet says about anything – preferred shares, insider trading – he bought into Goldman Sachs a day before they were bailed out. He owned 237 millions ounces of Silver – (37% of the world’s above ground supply) – bought it at $5 – sold at $7. It is now $34. He’s a spokesman… and a liar. Promoting the phoney paper scheme. Taxing is not going to solve the problem – nor even slow it down. Move one, nothing to see here…
Or…..the Plutocracy, sensing the inevitable, performs a jawbone manuever in an attempt to mollify the masses.
Well put. I remember McBuffoon dumping the silver for a few shekel profit…he did the same on McDonalds before it went from 12 to 104. Like I said, who cares what a guy who did well robbing the masses did decades ago.
He did well but is being put out to pasture.
I love the comment on Buffet being a ‘spokesman and a liar’. How true!
“Tax rates are for the wealthiest Americans” is a straw man. It affects no one. The problem is not the rich but rather Progressive politicians who have spent the accumulated capital of hundreds of years in a few short decades. Now we are massively in debt and these people are either fools or I suspect diabolical power mongers who think that they can keep spending and operating business as usual.