Lion of the Blogosphere

Warren Buffett vs. Donald Trump, part 2

To be clear, they both take advantage of tax benefits/deductions/loopholes that are available to them. Trump benefits from tax provisions that are good for real estate developers, like depreciation, and Buffett benefits from tax provisions that are good for fund managers, like being able to classify income as “capital gains” which are taxed at a much lower rate.

I don’t think that either of them are hypocrites for not paying more taxes than they are legally required to pay. It’s bull**** that Trump is not qualified to be president because he hires tax professionals who minimize his taxes. It’s equally bull*** what certain conservative types say about Buffett, that he’s not allowed to have an opinion that tax rates are too low on people like himself because he hires tax professionals who minimize the amount of tax he pays.

I am only mad at Buffett because he issues a press release accusing Trump of not being transparent with his taxes, but Buffett is being a hypocrite because he has not uploaded his full tax returns to the internet, which is what Democrats are saying that Trump should do.

Written by Lion of the Blogosphere

October 12, 2016 at 9:36 am

Posted in Politics

38 Responses

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  1. Haha, you think Buffett only takes capital gains? Nah… He uses Bermuda reinsurance businesses to basically avoid any possible short term cap gains for the investors, which is much more questionable than capital gains. Look it up. Google reinsurance hedge fund tax, etc.

    This is basically one of the only remaining ways to transform short term cap gains into long term cap gains and also avoid tax compounding altogether, which is a much bigger thing.

    Zack

    October 12, 2016 at 10:06 am

    • Once upon a time, I interviewed for a job at a group at a Big 4 account firm that provided the service for clients that they would give advice for re-arranging their foreign business to minimize the amount of taxes paid, so I am not aware of such things. It doesn’t change the point of the blog post, no one is a hypocrite for LEGALLY arranging their affairs to pay less tax.

      Lion of the Blogosphere

      October 12, 2016 at 10:25 am

      • Correct, for the average mortal, working in a foreign country, with a telecommuting job, is one way to take advantage of our dysfunctional tax system, which favors value transference types with high investment income, when it comes to zero or low taxes. It sucks to be a “working class” prole in America, where the IRS taxes your hard earned money, so it could be doled out to NAMs and racial minorities. And if you live in a liberal center like NYC, it’s called a tax travesty.

        Readers like Yakov, think I’m a fool for spouting such nonsense. America is a country with outdated/rotting infrastructure and a growing NAM population. Does anyone with a sane mind, think that our taxes are going to benefit the right kind of people?

        JS

        October 12, 2016 at 11:29 am

      • It’s not clear to me at all that a third-world foreign country is advantageous over a cheap place to live like Mesa Arizona.

        Lion of the Blogosphere

        October 12, 2016 at 2:10 pm

      • There’s always Canada and parts of Western Europe.

        You could rent an apt in Southern Spain for US $300, and work online for an American company.

        JS

        October 12, 2016 at 3:25 pm

      • “working in a foreign country, with a telecommuting job, is one way to take advantage of our dysfunctional tax system,”

        What are you talking about? You still have to pay US income tax. Unless you renounce your citizenship, in which case you’d have to obtain legal permanent residence in the foreign country. Good luck with that. And what good would it do, anyway? Taxes in Canada are comparable, and the cost of living is higher.

        Hermes

        October 12, 2016 at 4:44 pm

      • ‘Readers like Yakov, think I’m a fool for spouting such nonsense.’

        You are not a fool, you are son of a bitch. The country has problems, nobody says otherwise, but all you can do is gloat at the plight of the white working class and the country as a whole. I would send you to Gulag to be re-education.

        Yakov

        October 12, 2016 at 8:16 pm

      • There is an IRS exclusion of income earned in a foreign country, if you live there for 330 days and earn $100K or less. Good luck earning more than that in a foreign country, in that case, anything above $100K is taxable.

        What’s wrong with paying taxes to a country that is 80%-90% White?

        JS

        October 12, 2016 at 8:54 pm

  2. In the previous post, I wasn’t saying that Buffet isn’t allowed to have an opinion that tax rates are too low on people like himself because he hires tax professionals who minimize the amount of tax he pays. I was just bringing up the confusion over whether he has in fact called for higher taxes on capital gains, as opposed to just earned income. You seem to think he has; other commenters seem to think he hasn’t. Anyone have any solid info either way? (Googling the “Buffet Rule” didn’t yield a solid answer for me.)

    Hermes

    October 12, 2016 at 10:26 am

    • This is just the point. Buffet is not talking about removing the legal arcana that allows him to define whole swathes of his income as untaxable. He just wants the marginal tax rates that everyone pays to go up. That is the lie guys like Buffet push.

      So, yes, Buffet does have the right to comment on tax policy even though he tries to minimize his taxes. What’s important to realize is that he will still be minimizing his taxes while everyone else’s taxes are going up.

      map

      October 12, 2016 at 5:31 pm

      • Obama’s “Buffett Rule” proposal would have increased Buffett’s taxes, Republicans filibustered it.

        Lion of the Blogosphere

        October 12, 2016 at 5:38 pm

      • Here is how this scam works:

        Say you have two sets of incomes that are both subject to marginal tax rates: one set of taxable income is Buffet’s $10 million a year. The other set of taxable income is $65,000 a year for a middle class person. Let’s say the Obama rule increases Buffet’s taxes by 50% and it increases the other guys taxes by 15%. The fact that it represents such a large tax increase for the rich guy is largely irrelevant, mostly because a guy with $65 billion in assets does not have to worry about taxes on $10 million. You could tax that income at 100% and it would not matter. But every tax increase on the guy making $65,000 is felt immediately. This sort of rule is perfectly reasonable to oppose, no matter how much the media touts that this tax on the rich is being opposed by Republicans.

        Remember, the Democrats controlled the House for most of the last century, up until 1995. In that entire period, the concentration of wealth went up, despite all of the rhetoric Democrats used about income redistribution.

        When some billionaire offers a tax on unrealized capital gains of 15% or more, then we can talk about something real. In fact, Trump did offer such a tax: on carried interest.

        map

        October 12, 2016 at 5:57 pm

      • “Say you have two sets of incomes that are both subject to marginal tax rates: one set of taxable income is Buffet’s $10 million a year. The other set of taxable income is $65,000 a year for a middle class person. Let’s say the Obama rule increases Buffet’s taxes by 50% and it increases the other guys taxes by 15%. ”

        The Obama rule would have had a ZERO increase on the $65,000/yr guy’s taxes. Republicans filibustered it to protect their rich donors, even though most rich people voted for Obama.

        Lion of the Blogosphere

        October 12, 2016 at 6:00 pm

      • You guys are just talking past each other until one or the other can cite a source showing whether Buffet has called for an increase in tax on capital gains. Lion, in particular, keeps ignoring that issue.

        Hermes

        October 12, 2016 at 8:13 pm

      • What do you think he meant when he said that he has a lower tax rate than his secretary?

        Lion of the Blogosphere

        October 12, 2016 at 11:44 pm

      • “The Obama rule would have had a ZERO increase on the $65,000/yr guy’s taxes. Republicans filibustered it to protect their rich donors, even though most rich people voted for Obama.”

        Hmmm…ok. If you say so. Given the behavior of the rich, I am perfectly willing to see them shafted. I just don’t a guy like Buffet has something like that in store.

        map

        October 12, 2016 at 11:20 pm

  3. This latest batch reveals that lolcow Louise Mensch of Heat Street wrote a Hillary ad.

    IHTG

    October 12, 2016 at 10:58 am

  4. The amazing thing from my perspective is that the same TruCons who were shocked, SHOCKED I TELL YOU, that anyone could possibly have any issue with how Romney made and managed his money (it was legal, wasn’t it?), are now twisting themselves into pretzels to present Trump working within the tax laws as being the worst thing ever.

    Jesse

    October 12, 2016 at 11:02 am

    • PhonyCons are a testament of America’s demise, either they’re stupid or delusional. Let’s give them the benefit of the doubt, and not say they’re are hypocrites. On the other side of the spectrum, we have the liberal rabble rousing, riff-raff.

      JS

      October 13, 2016 at 12:03 am

      • “PhonyCons”

        Heh, that may be the first worthwhile thing you’ve posted here.

        Mike Street Station

        October 13, 2016 at 10:56 am

      • That’s your opinion.

        I forget to make comments about the NYC’s Columbus Day Parade, which will lead to MaryK responding.

        What is wrong with this holiday, besides the fact that Columbus was a murderer in the New World?

        Columbus was Northern Italian, and most IAs are Southern Italian. Most IAs can’t even name an illustrious Southern Italian, only Northern ones. They know of Galileo, but most never heard of Giordano Bruno, who came from Naples.

        Italy refused to finance Columbus’ voyage to the New World. It was a waste of time and money. Other European nations had the same view, but Spain thought it was a good idea.

        And why aren’t Hispanics celebrating Columbus Day? He killed many natives in Puerto Rico.

        JS

        October 13, 2016 at 12:47 pm

  5. What about the fact that higher taxes on the rich would help Buffett’s businesses? Isn’t that a conflict of interest when he publicly advocates for changing the laws? shouldn’t he disclose that conflict of interest? He never has. The linked article explains it:

    “Higher taxes on the rich, especially estate taxes, would be a major boon to Buffett’s insurance and annuity businesses that help rich Americans avoid those kinds of higher taxes.”

    http://www.cnbc.com/2016/10/11/trump-doesnt-have-to-release-his-taxes-and-warren-buffett-should-zip-it-commentary.html

    JimBonobo

    October 12, 2016 at 11:12 am

    • Republican talking point, trying to convince middle-class voters that their interests are aligned with billionaires.

      Lion of the Blogosphere

      October 12, 2016 at 2:09 pm

      • “We can’t decrease the drunk driving limit because it will just enrich the companies, such as cab firms, that become wealthy off peoples’ attempts to avoid a DUI.”

        Jesse

        October 12, 2016 at 2:36 pm

    • Yes, Buffett is in the business of selling death-tax dodges, i.e. life insurance. No surprise he favors higher death taxes. http://dailycaller.com/2010/11/30/report-giant-life-insurance-lobby-key-force-behind-estate-tax/

      steve@steve.com

      October 12, 2016 at 10:01 pm

      • Buffett has a huge diversified business and I find it extremely unlikely that that would be any more than a de minimus amount of extra revenue for Buffett as a result of such a tax change compared to how much money his conglomerate is already making.

        I think this is really stupid that people like you are trying to find some hidden agenda here. Buffett thinks rich people’s taxes are too low. I agree with him. He’s just being honest about it.

        Funny how once upon a time, libertarian types LOVED Warren Buffett, until he came out as a non-libertarian.

        Lion of the Blogosphere

        October 12, 2016 at 11:48 pm

      • Rich people in America also don’t finance or subsidize the NAM underclass and the welfare shenanigans coming from the various immigrant groups such as the Asians, Haredim, Hispanics and Russians. That’s the job of the middle class.

        JS

        October 12, 2016 at 11:58 pm

  6. Well, I’m only mad at Buffett because he supports leftist ideas.

    Jason Liu

    October 12, 2016 at 12:00 pm

  7. Warren Buffet isn’t running for president. Trump is. You know damn well that there are further embarrassing things buried in his returns. Your anger over Buffet’s trashing of Trump betrays your realization of the political consequences that come with paying zero taxes as a (proclaimed) billionaire for more than a decade. The optics are simply terrible — they basically say you can lose a bunch of other people’s money in your dodgy, inept business gambles, and claim it as a loss on your own taxes, paying nothing to the federal governmant. This scenario is highlights the problems with extreme concentrations of wealth.

    You chose a well-known scumbag and tax cheat as your champion of tax reform for the middle class.

    Jack

    October 12, 2016 at 12:08 pm

    • “Warren Buffet isn’t running for president. Trump is. You know damn well that there are further embarrassing things buried in his returns.”

      I agree that Buffett doesn’t have to release his returns. EXCEPT, if he wants to prove a point that he’s more transparent than Trump, then in that case he DOES have to release his returns to prove that point.

      I am sure that both of them have something to hide. Wikileaks certainly showed us how much the Clintons had to hide.

      Lion of the Blogosphere

      October 12, 2016 at 2:16 pm

    • Jack,

      The point is, they are leveling accusations at Trump for what they routinely do themselves, while avoiding relevant questions. I was reading Bill and Hillary’s reported tax returns. In 2015, they filed income jointly of $10 million. Please explain to me what product or service were they producing that justifies that kind of income. “Speaking” fees? Must be some golden wisdom there. Is there a GS-10000 government job I am not aware of? Obscene amounts of money made by people who have held nothing but government work should create some serious suspicion on the part of the public, not some real estate guy taking normal tax deductions.

      map

      October 12, 2016 at 5:41 pm

  8. Is this real life? Democratic Conspiracy Against Catholic Church: https://www.theamericanconservative.com/dreher/democrats-conspiracy-the-catholic-church/

    Trump’s already on it:

    IHTG

    October 12, 2016 at 2:29 pm

  9. The total charitable contributions I made during the year were $2,858,057,970, of which more than $2.85 billion were not taken as deductions and never will be. Tax law properly limits charitable deductions.

    I didn’t understand the tax implications of this part. What taxes did Buffett pay on the $2.85 billion not taken as deductions? Or was this just a very normal part of his Gates Foundation tax wheeze?

    Also, if he deducted $5 million last year, his 72 years of returns might add up to $360 million of deductions. Well, possibly less, possibly more, but who knows. Bad Warren. Bad, bad Warren.

    Glengarry

    October 12, 2016 at 3:31 pm

    • “I didn’t understand the tax implications of this part.”

      Indeed, Buffett should release his entire return to we can figure it out!

      Lion of the Blogosphere

      October 12, 2016 at 3:32 pm

      • My guess is; Buffett made $2.85 billion in capital gains, paid no taxes on it and donated it to charity so that he will never have to pay taxes on it. If I had been paid a $2 billion salary last year, I would pay $600 million in income taxes. Tax what you don’t want.. working wages; subsidize what you do want… single parenthood and unemployment.

        cesqy

        October 12, 2016 at 3:57 pm

      • I don’t want my tax money subsidizing anyone in America. It should only pay for FICA, if one is required to pay the government.

        JS

        October 12, 2016 at 4:43 pm

      • I was happy to report my taxes honestly previously, because I was being subsidized. I was living at a rent stabilized unit near Astor Place, downtown Manhattan, essentially one of those poor door apartments. So I was happy to pay my fair share of taxes. Going forward, I’m not giving Uncle Sam or any state, a cent for income taxes.

        JS

        October 12, 2016 at 4:46 pm


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