Warren Buffett, billionaire CEO of Berkshire Hathaway, is a close friend and rabid supporter of everything President Obama including increasing taxes on the presumed wealthy who are not paying their fair share. Well, in some ways I can agree with Mr. Buffet except he is not calling for more taxes on the wealthy, he is calling for more taxes on the hard working and the smart investors. What he, most people, and every politician I have heard seem to not know the differences between the wealthy, the rich, and the well compensated for their efforts. Politicians call for taxing the rich and the wealthy then propose raising taxes on those who are well compensated for their efforts.
So, in this very short article I am going to make two simple suggestions to remedy the lack of taxing the wealthy and the idle rich. First, for all who believe that they are not paying sufficient taxes let me point out that there is a line on every tax return that allows for you to mitigate your guilt of paying too little to the government. This line allows you to make an additional and completely voluntary contribution in addition to your required tax fees. This is a readily available means for you to pay exactly as much as you feel you really ought to pay without forcing those who feel they have paid sufficient amounts of their hard earned money just because you have guilt feelings. It really is that simple Mr. Buffet.
Now, let us address that the wealthy and rich do not pay sufficient taxes considering their immense wealth. Taxing people who make over a quarter of a million dollars a year is not taxing the wealthy, it is taxing the hard workers who are getting a very nice return on their efforts but through higher taxes being prevented from becoming part of the wealthy. So, let’s not tax effort and tax the “idle rich” funds. It is a very simple idea that I doubt even Mr. Buffet will find fault with as it will not make his taxes measurably higher, something he claims to desire but takes actions to avoid whenever legally possible. Mr. Buffet invests in such a manner to protect his wealth and keep it from being overtly taxed; otherwise he would indeed pay a higher amount of taxes. What I would propose is that a tax of one percent be placed on any monies held over five million dollars that is not invested in stocks, bonds, treasuries, CDs, or any other interest or risk investment with the one provision that it be in an American bank, industry, company or investment group. This would assure that the wealthy not become the idle rich who, like Thurston Howell III, sit on some island with Gilligan counting his money. This tax would encourage investment and keep the monies invested domestically if properly fashioned and would be a true tax that only affected the wealthy while not preventing the hard working from becoming wealthy.
Beyond the Cusp