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Politics : Formerly About Advanced Micro Devices -- Ignore unavailable to you. Want to Upgrade?

To: bentway who wrote (341587)	8/26/2007 3:43:57 PM
From: TimF	Respond to of 1576012

Most of Buffet's wealth increase is from gains that he hasn't realized as income. In terms of what he does realize and pay taxes on, if he pays 17.7 percent its not ordinary income (it either realized capital gains or its partially tax free income), he's not going to pay only 17.7% on a salary of $46 mil. Making his taxes more equal by increasing taxes on investments will tend to reduce investment. If you have to make things more equal than decrease his subordinates taxes. Or if he can't wait, he can just send a check to the treasury. Of course the biggest difference in those subordinates taxes is the taxes to pay for entitlements. SS and Medicaid aren't supposed to be transfer programs (even if to a large extent they are), but "social insurance" where you pay in so you can withdrawal later. Buffet's SS earnings are capped, he can't make more than a modestly wealthy person, and he's unlikely to draw more from Medicaid certainly not significantly more. I suppose you could argue for eliminating the caps on the taxes(which would be required if you where going to get people like Buffett paying anywhere near the tax rate of a high salaried employee), without eliminating the caps on SS benefits (I doubt you would argue that SS should pay Buffett enormous amounts of money every month). But if your going to do that than any pretense about the SS being anything but a wealth transfer program would have to be dropped, and investment income would also feed in to social security and medicaid. Than Buffet might be paying more taxes, but you'll be chasing a lot of investment in to other countries. Not a trade that I would make.