In an NYT OpEd Warren Buffet is begging to make him pay more 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.
The reason for Buffets ludicrous low tax rate is the very low 15% tax rate on capital gains.
It would make sense, and save a lot of problems, if the U.S. would tax capital gains at the same rate as income form a regular job.
But Buffet isn't asking for that. Instead he has an agenda which is to cut "entitlements" while only moderately rising taxes for the very rich. With regards to new super congress committee which is supposed to find a compromise on $1.5 trillion of government revenue and spending he remarks:
Job one for the 12 is to pare down some future promises that even a rich America can’t fulfill. Big money must be saved here. The 12 should then turn to the issue of revenues. I would leave rates for 99.7 percent of taxpayers unchanged and continue the current 2-percentage-point reduction in the employee contribution to the payroll tax. This cut helps the poor and the middle class, who need every break they can get.
But for those making more than $1 million — there were 236,883 such households in 2009 — I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains. And for those who make $10 million or more — there were 8,274 in 2009 — I would suggest an additional increase in rate.
Here Buffet is just offering the false neoliberal conventional wisdom and follows the stampede into austerity. Those "future promises that even a rich America can’t fulfill" do not exist. Social security has enough accumulated money and regular income to pay out what it promised for another 30 years or so. There is no need to cut it, or to increase payroll taxes, at all.
Medicare and medicaid would be fine too if they would be allowed to negotiate over, or self produce, the drugs people need. That a good socialized health care system can be run for less money than medicare is daily proven by the veteran health care system.
Social security and access to medical care are not entitlements. The people who get them have (in average) paid for them all their life. To get them is their right.
The whole op-ed is thereby a trap. "Look a billionaire asking for higher taxes. The man must be right." In reality Buffet is not offering to give up much at all. If he would asked to increase capital gain taxes to the payroll tax level it would have made a difference. But what he offers is just a undefined tax increase for very few, who will not even feel it at all, to set out a false argument to cut from many in need.