Warren Buffett, the chairman and chief executive of Berkshire Hathaway, is spectacularly wealthy. Yesterday, he took to the New York Times to complain that Washington is a little too preoccupied with “protecting” him and those like him, and pleaded with policymakers to be responsible and raise his taxes.
Last year my federal tax bill — the income tax I paid, as well as payroll taxes paid by me and on my behalf — was $6,938,744. That sounds like a lot of money. But what I paid was only 17.4 percent of my taxable income — and that’s actually a lower percentage than was paid by any of the other 20 people in our office. Their tax burdens ranged from 33 percent to 41 percent and averaged 36 percent. […]
Back in the 1980s and 1990s, tax rates for the rich were far higher, and my percentage rate was in the middle of the pack. According to a theory I sometimes hear, I should have thrown a fit and refused to invest because of the elevated tax rates on capital gains and dividends.
I didn’t refuse, nor did others. 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.
Millionaires and billionaires, Buffett concluded, “have been coddled long enough by a billionaire-friendly Congress. It’s time for our government to get serious about shared sacrifice.”
Remember, as far as congressional Republicans are concerned, what Buffett recommends is tantamount to radical socialism. Any proposal to increase taxes on anyone by any amount — even on the wealthiest of the wealthiest of the wealthy — is an automatic deal-breaker in GOP circles. Indeed, under House Budget Committee Chairman Paul Ryan’s plan, widely endorsed by Republicans everywhere, what the rich really need is another tax break.
With this in mind, Buffett’s advice will probably be ignored on Capitol Hill, especially among GOP members of the Murray/Hensarling “super committee,” which will begin its work soon. But I’m glad the Berkshire Hathaway CEO is making the case anyway, if only to reinforce the extent to which congressional Republicans are being ridiculous.