Warren Buffett was at it again recently: telling anyone who would listen about the need for a “millionaires tax” in the United States. However, while the Corporate Media was (as usual) heaping praise on Buffett, the reality is that Warren Buffett is not being “magnanimous”, he’s being disingenuous.
Why is Warren Buffett so adamant about the need for the Tax Man to start squeezing the millionaires? So that he (and his billionaire Oligarch-buddies) can continue to avoid paying his fair share of taxes.
Buffett knows that everyone below the level of millionaire has already been squeezed dry. Buffett knows that the U.S. is drowning in debt, and (in real dollars) tax revenues have totally collapsed. So unless the U.S. government comes up with a new source of revenue (and fast), Oligarchs like Buffett are facing a grim future. Either their entire Paper Empire will disintegrate in a wave of domino debt-defaults, or the exponentially increasing money-printing needed to “fund” exponentially rising deficits will quickly trigger hyperinflation – also taking their Paper Empire to zero.
As regular readers know, it is impossible to ever construct a “fair” system of income taxation. As a basic proposition of arithmetic, all income tax systems slowly but inevitably funnel all wealth out of the pockets of the bottom-99% and into the vaults of the top-1%. While I’ve explained the mechanics here before; since this obvious concept has still not been grasped by most readers I’ll explain it one more time.
For the poor; annual income represents nearly 100% of their total wealth. For the dwindling number of the Middle Class; annual income still represents a large percentage of their net wealth. However, for the average Billionaire; income represents less than 5% of their total wealth. Even if Billionaires had their own income taxed at a 100% rate, they would pay a much smaller percentage of their total wealth in taxes than one of the Little People, being taxed on their income at only a 25% rate.
Unlike the rest of us, most of the increasing wealth for these Billionaires does not come from income. Rather, it comes from the untaxed appreciation of their hard assets: their mansions, their yachts, their antique paintings. Just imagine how the dread which the Little People have for Tax Day would instantly evaporate if they knew that as much as 95% of their wealth would be immune to any taxation, throughout their entire lives...
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