Taxes and The Rich

When someone who is at the poor end of the wealth spectrum (i.e. the vast majority of people in the world) make statements about income disparity, class inequality, or the basic unfairness of a nation’s infrastructure, even if those statements are objectively and factually true, they can easily be at least somewhat deflected by observing that those statements line up with the self-interest of the person making them. “They aren’t really arguing for fairness, they just want more for themselves” or “They’re just looking for a handout” are common rhetorical tools for doing this, but you’ve doubtless seen many other variants of this argument.

Well, that technique doesn’t work when the person making the statement is the third-richest man in the world:

Buffett blasts system that lets him pay less tax than secretary
Warren Buffett, the third-richest man in the world, has criticised the US tax system for allowing him to pay a lower rate than his secretary and his cleaner.

Speaking at a $4,600-a-seat fundraiser in New York for Senator Hillary Clinton, Mr Buffett, who is worth an estimated $52 billion (£26 billion), said: “The 400 of us [here] pay a lower part of our income in taxes than our receptionists do, or our cleaning ladies, for that matter. If you’re in the luckiest 1 per cent of humanity, you owe it to the rest of humanity to think about the other 99 per cent.”

Mr Buffett said that he was taxed at 17.7 per cent on the $46 million he made last year, without trying to avoid paying higher taxes, while his secretary, who earned $60,000, was taxed at 30 per cent. Mr Buffett told his audience, which included John Mack, the chairman of Morgan Stanley, and Alan Patricof, the founder of the US branch of Apax Partners, that US government policy had accentuated a disparity of wealth that hurt the economy by stifling opportunity and motivation.

I made that one bit bold for emphasis. The statement is already high-lighting a reprehensible situation, but when you really recognize the implication of the bit in bold it jumps up to a whole new level of disgusting.

This comment also makes extreme sense to me:

Mr Buffett said that a Republican proposal to eliminate elements of inheritance tax, which raises about $30 billion a year from the assets of about 12,000 rich families, would broaden the disparity between rich and poor. He added that the Republicans would seek to recover lost revenue by increasing taxes for the less prosperous.

He said: “You could take that $30 billion and give $1,000 to 30 million poor families. Or should you favour the 12,000 estates and make 30 million families pay an extra $1,000?”

In the interest of exposing my biases: my wife tells me that my salary is in the top 1% of “wage-earners”, whatever that means–although I’m a lot closer in annual income to Buffet’s secretary than to Buffet! I pay somewhere between 40 and 50 percent of my salary in income tax, despite maximizing my RRSPs. Oh, and I am firmly in favour of graduated taxation where the people who can afford it shoulder more of the tax burden. You don’t hear that a lot from my socio-economic peers, but I’m not going to get into that, since that’s a whole other rant.

I’d love us to switch to an ethic of citizenship where people could be proud of the fact that they have more to contribute to the community, and would feel pride in their contributions. Wouldn’t that address both typically right-wing laziness boogey-man, and also introduce an element of jointly participating in something? Of course, we’d first have to make people feel that their governments and the products of them were, in fact, theirs. I’ve got a whole other rant bottled up about the systematic and, I think, intentionally alienation of the population from their government, but I’m going to keep that in the can for now.