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The Hypocrisy of Warren Buffett

By Larry Johnson on August 26, 2011 at 10:17 PM in Current Affairs

This is too delicious to ignore. Remember billionaire Warren whining about how few taxes he paid and that it is the patriotic duty of all wealthy Americans to pay more. Really?

Well, looks like Warren is good at talking bullshit. Bill Wilson at Netright Daily has a dandy piece exposing Buffett’s hypocrisy:

To wit, he wrote of the so-called “super-rich,” which he apparently defines as households earning $1 million or more a year: “Most wouldn’t mind being told to pay more in taxes as well, particularly when so many of their fellow citizens are truly suffering.” Isn’t that nice of Mr. Buffett?

But if he were truly sincere, perhaps he might simply try paying the taxes the Internal Revenue Service (IRS) says his company owes? According to Berkshire Hathaway’s own annual report — see Note 15 on pp. 54-56 — the company has been in a years-long dispute over its federal tax bills.

According to the report, “We anticipate that we will resolve all adjustments proposed by the U.S. Internal Revenue Service (‘IRS’) for the 2002 through 2004 tax years at the IRS Appeals Division within the next 12 months. The IRS has completed its examination of our consolidated U.S. federal income tax returns for the 2005 and 2006 tax years and the proposed adjustments are currently being reviewed by the IRS Appeals Division process. The IRS is currently auditing our consolidated U.S. federal income tax returns for the 2007 through 2009 tax years.”

Americans for Limited Government researcher Richard McCarty, who was alerted to the controversy by a federal government lawyer, said, “The company has been short-changing the tax collection agency for much of the past decade. Mr. Buffett’s company has not fully settled its tax bills from 2002-2009. Yet he says he’d happily pay more. Except the IRS has apparently been asking him to pay more going on nine years.”

Here we have another prime example of “Do as I say, not as I do.”

Take a look at the full article. It is worth your time.

Read more at NetRightDaily.com.

  • Anonymous

    “I’ll gladly pay you even more taxes on Tuesday for a deferment today”

    Hard to feel sorry for a guy who can sink $5,000,000,000 into Bank of America just after chatting with the President–who gave him who-knows-what assurances….The Wizard of Omaha, indeed….

    Betcha B of A is one of those Too Big to Fail outfits that the public will rescue after the next collapse!

  • Patience

     If Mr. Buffett were as staunch a supporter of a conservative politician as he is of the POTUS this story would be blaring ad nauseum on network and cable news stations. 

    Has anyone else noticed that Big Media don’t characterize uber-rich businessmen as venal, greedy fat cats when they support liberals? 

    • hc123

      It makes me admire the Koch Brothers. I am sure life would have been easier had they just pretended to be progressives.

  • Anonymous

    Republicans believe that every day is July 4th.
    Democrats believe that every day is April 15th.

     -Ronald Reagan

    • Anonymous

      Interesting. One is a Federal holiday and the other one is the day the Federal government picks your pocket. Too bad neither party is capable of spending in a responsible fashion.

  • Anonymous

    I disagree with you Larry. If you had said this about his personal taxes I would have agreed. But this is a public company and he has to defend the corporate position for the benefit of all the shareholders. There was a Supreme Court decision that said a corporate officer has a fiduciary duty to the shareholders to maximize their return. He cannot use his personal opinions to operate the company in any way that conflicts with this duty.

    • Docelder

      Which is the thing about the uber rich… they can afford the tax attorneys to plan it so that they don’t owe taxes. Talk is cheap for somebody in that position when that talk is about everybody who can’t afford those tax lawyers. Which is again the middle class business owner… which seems to be everybody’s target right now… even though this is the jobs engine for our economy. Then again the uber rich don’t need jobs. They apparently don’t need customers either so long as they partner with government… this growing government corporate connection is troubling. 

      • Anonymous

        Talk is cheap for somebody in that position when that talk is about
        everybody who can’t afford those tax lawyers. Which is again the middle
        class business owner… which seems to be everybody’s target right
        now.
        __________________________________________

        Doc, I run 3 middle-class businesses for their owners. The ones that are C corps are OK but the vast majority of American accountants put their clients into S Corps and LLCs (which I haven’t run into in other countries). Those owners in LLCs and S Corps are forever juggling personal and company – they pay their taxes from their companies from their equity. Their estimated taxes are based on their previous year’s taxes. With see-sawing business profits these days it is a nightmare.
        For the C Corp owners they take a payroll salary like everyone else and make decisions about company profits when year end is coming up.
        Whenever you confuse your personal with your company you are making a big mistake.

        • hc123

          What are the annual revenues of these “middle class” C corps? In which states are they incorporated? What do they do? What is your role in them, more specific than “running” them?

          There are certainly reasons to be a C corp, and there are also reasons to be an S corp, an LLC taxed as an S corp and even the dreaded SP. Converting every single business to a C corp (and I guess letting you run it) probably would not fix our current malaise.

          Our entire tax code is stupid, but there are also plenty of C corps in trouble these days, just like all the rest.

          • Anonymous

            What are the annual revenues of these “middle class” C corps? In which
            states are they incorporated? What do they do? What is your role in
             them, more specific than “running” them?

            I’m CFO or Financial Controller of 3 companies in California.
            What they do doesn’t matter.
            And I’m not about to give out their annual revenues. Suffice it to say they fit small business.
            You miss my point hc123. It wouldn’t change anything financially for S Corps to be C corps but It would change the feeling that people with S corps have that corporate expenses are coming completely out of their pocket personally.
            There needs to be a psychological separation between people and their corporations.

    • Anonymous

      Getting into a tax dispute with the Federal government is never in the best interest of shareholders who will be responsible for the enormous penalities the government slaps on Warren’s companies.

      Buffet, like Immelt, have Obama wrapped around their finger and an appropriate Congressional investigation would be to see exactly how much financial gain these two, and other Obama supporters from the business world, have gotten from their support of Obama.

      I would start with the NLRB dispute with Boeing’s non-union plant in the South and GE’s deals with China helping their airline industry. I would also take a close look at the Buffet deal with Bank of America.

      Too many coincidences.

      With all the years of liberals barking about Bush/Cheney with Haliburton, it appears Obama is making that like nursery school.

      • Anonymous

        Don’t forget Soros.

    • democrat1

      I agree with this

  • Sick of it all

    Warren Buffet is a DEMOCRAT.  He is holding a fundraiser for BO in a couple of weeks.  Most of the rich on Wall Street are DEMOCRATS.

    • Anonymous

      I don’t know, Sick of it all.  Sometimes it seems like most of the rich on Wall Street belong to whatever party is in power at the moment.  They know which side their bread is buttered on and that’s the side that won the last election..

      • Ferd_Berfle

        They know which side their bread is buttered on and that’s the side that won the last election..
        ================
        Or the side that they put in office. It seems to me that we get whoever they want. Meet the new boss, yada, yada, yada.

    • Anonymous

      Well all of those Wall Street democrats and Buffett need to put their money where their mouth is. Cough up some checks made out to the US GOVERNMENT, just to show how “patriotic” they are, in the mean time, leave small businesses alone and they can also get the hell out of my pockets. These so called rich people pass the taxes on down to you and me in the form of expenses in the cost of doing business (higher prices). Does anyone with any brain capacity actually believe that they are going to pay those taxes? If you do, I have some swamp land to sell you.

      • Anonymous

        Buffett says, “We also serve who only buy stock in big banks”.

  • yttik

    Yep, this isn’t surprising. Most of the wealthy who support higher taxes can advocate for that because they know full well that they will never have to pay them. They have teams of tax attorneys, tax shelters, ways of manipulating their money. The only ones who ever get soaked by taxes for “The Wealthy,”,are the middle class and small business owners. Hillary Clinton tried to point this out during the primaries when Obama wanted to tax people making over 250,000. Well, on paper those are our small businesses, our high end first responders and teachers. On paper, somebody like Bill Gates,  can whittle his income down to less than 250 grand. These tax increases for “The Wealthy” will never reach somebody like him.

  • hc123

    I am totally fine with creating a new tax bracket for all these retards – Gates, Buffett et al.

    102% of their personal wealth (not income, wealth) and say 90% of their income works for me, and would seem to be in line with their belief system.

    In about one tax year they will be in an exciting new tax bracket (“middle class”) and may then be able to understand what the rest of us are talking about.
    Of course it will do nothing to change the economic issues this country faces. But hey, its not about economics, its about social justice, right?

    • Anonymous

      Of course what happens is that they simply find ways to pass long those taxes onto their customers, clients, and sharholders.

    • Anonymous

      102%?? And here’s a news flash… if you take their wealth, they will have no income to tax. Wealth, ie. shares, stocks, bonds, etc. are what produce income. If you take his wealth, he will have no income. If you don’t know that about money, you should not be giving advice on tax reform.

      • hc123

        If I take your wealth you wont have any income?

        You are saying when a person loses his home, automobile and/or bank account (where most of us “little people” store our wealth) he also loses his job (where most of us get our income)? I was unaware of this interesting economic fact.

        My point actually was that if Mr. Buffett would like everyone to pay more in taxes he should go first, and go heavy. And as most of his money does not come from W2 income, his the special “Buffett Tax” should take this into account by taxing the hell out of the rest of his stuff.

        A special tax that exceeds 100% has happened before on Earth, and I am sure it will happen again. Just go ask the Brits. So although 102% seems to shock and amaze you, I believe the real life English example was actually 104%.

        I am completely aware that this “rich person tax” would do nothing to save America from runaway  expenditures and I clearly do not actually support it.

        Thats why I said it would be about the social justice, not the economics.

        It would be an economic disaster for everyone. But it would make certain op ed writers at the wapo and huffpoaolkos pretty happy.

         

        • Anonymous

          If someone loses their house, car, savings, the chances are pretty good he has already lost his job. If he hasn’t he won’t keep it long with no way to get there, no car, and no place to clean up between work days. And Warren Buffet does not have a job, he is an investor, so all his income comes from his investments, ie, his wealth. He does sit on some boards, and gets remuneration for that, but he gets paid even if he doesn’t show up for board meetings, so it can’t be characterized as a job. And as for the

          • hc123

            Yes, thank you for making my point for me.

  • Anonymous

    Larry, How does being a successful investor rise to the level of the civilian equivalent of the Congressional Medal of Honor?

    • Anonymous

      It’s the Presidential Medal of Freedom, not the Medal of honor. 
      And Obama also gave it to a known communist, John Sweeney, former head of the AFL/CIO.  

      It’s payback for support.  Except they always throw in a few for the opposite party (George H.W. Bush, for example). 

      Basically, it’s another award that has lost it’s meaning. 

      • Anonymous

        Like the Nobel Peace Prize.

        Pretty soon all of these “Major Awards” are going to be about as prestigious as the Leg Lamp made famous in “A Christmas Story.”

        • Anonymous

          Bet you can get more for the leg lamp on Ebay than a Medal of Freedom. Hehehe.

      • Anonymous

        The first Communist to get the Presidential Medal of Freedom was Whittaker Chambers. Ronald Reagan gave it to him. How’s that for irony???

        Here is the Wiki on Chambers, for those of you who are going, “Who??”
        http://en.wikipedia.org/wiki/Whittaker_Chambers

  • Fire 0bama

    Butthead Buffett, all you do is gritch that you do not pay enough taxes yet you don’t even pay what you owe.  

    Every time a lib gritches that he does not pay enough in taxes then a penalty clause should be invoked to make the libs pay more.  That is right libs, put your money where your mouth is.  And let the rest of us decide how much you should pay since you are the one who stated you are not being taxed enough.
     
    Buffett, I think $50k per year is enough for you to live on.  So write a check for your net worth less $50k and send it to the government.  What’s wrong Buffett, can’t find your check book?  Does your hand have a cramp?

      

  • Fire 0bama

    Butthead Buffett, all you do is gritch that you do not pay enough taxes yet you don’t even pay what you owe.  

    Every time a lib gritches that he does not pay enough in taxes then a penalty clause should be invoked to make the libs pay more.  That is right libs, put your money where your mouth is.  And let the rest of us decide how much you should pay since you are the one who stated you are not being taxed enough.
     
    Buffett, I think $50k per year is enough for you to live on.  So write a check for your net worth less $50k and send it to the government.  What’s wrong Buffett, can’t find your check book?  Does your hand have a cramp?

      

  • Anonymous

    This is no surprise to me.  Liberals are notorious hypocrites.

  • Wbboe

    Larry–

    With Buffett, the question is, has always been, whether he is i) a delusional left wing billionaire who loves playing the role of curmugeon, ii) an idiot savant (genius in one narrow area, idiot everywhere else, or as you say simply iii) a hypocrite.  Or, perhaps all of the above.  
    Clearly, the Oracle of Omaha is a great stock picker, but he is a terrible picker of political candidates, if he really believes Obama deserves a second term, and is throwing a fundraiser to that end. Frankly, you make a good case for iii), and there is other evidence to support your theory.  But you need to go home to Omaha to find it.

    • Anonymous

      Other things to consider when it comes to Buffet is that he has always been opposed to the New Deal government intervention policies. So why is he suddenly a true believer with Obama? Or are there other considerations?

      Also, Buffet is nothing more than a folksy Midwestern version of Gordon Gekko. He has never created a company – he has only invested in them. He has no idea what it is like to be a small business owner – to be an entrepreneur – and to build something from nothing. 

      I believe people like Buffet, Soros, and Immelt saw a willing dupe in Obama and have used his administration to further their own interests.

      • Ferd_Berfle

        I believe people like Buffet, Soros, and Immelt saw a willing dupe in
        Obama and have used his administration to further their own interests.
        ======================
        Yeah–and all they had to do was give Thee One attention. That One’s NPD will be our collective undoing.

        When will the American public start becoming aware of the utter bamboozling going on here?

        • Wbboe

          Yup. They see Obama for what he is: a cheap date.  Give him a billion in contributions and he will pave the way for them to steal a few trillion from the people he SUPPOSEDLY represents.  Pretty good r.o.i. (return on investment.)

          I told the arbitrator that if a union representative took money from an employer to sell out his membership, then he would be looking at hard time.  But with Obama nobody scruples to call what he does illegal, and far from hard time, he receives good time in return, i.e. le bon temps roule.

          • Ferd_Berfle

            RICO.

      • Wbboe

        Agreed.  But do not sell hypocrisy short. 

        Here are the facts, as I understand them. Warren marries, they raise their children, then she leaves him and moves to San Francisco, they stay married for 27 years, she tells a waitress to keep an eye on him, manaschevetts does she,  Warren and the waitress develop what they call in California a stable meretricious relationship, wife finally dies, Warren and the waitress marry.  Story book ending.

        Then, after his wife’s death he explains all this in an article in Time magazine entitled Warren Buffett tells all: the women in his life. Of course, it is too late to get his wife’s side of the story.

        http://www.time.com/time/business/article/0,8599,1843839,00.html 

        Can’t get much folksier than that. 

        Yo’al are all too young to remember Hank Locklin, but he had something to say about this  kind of situation.

        http://www.youtube.com/watch?v=WYQMMcVXuGU&feature=related

  • Wbboe

    Larry–

    With Buffett, the question is, has always been, whether he is i) a delusional left wing billionaire who loves playing the role of curmugeon, ii) an idiot savant (genius in one narrow area, idiot everywhere else, or as you say simply iii) a hypocrite.  Or, perhaps all of the above.  
    Clearly, the Oracle of Omaha is a great stock picker, but he is a terrible picker of political candidates, if he really believes Obama deserves a second term, and is throwing a fundraiser to that end. Frankly, you make a good case for iii), and there is other evidence to support your theory.  But you need to go home to Omaha to find it.

  • olivia98

    the white has made a deal with Buffet.  We won’t go after money your company owes if you back our tax the rich story.  I’m afraid you have think like those thugs and crazies in our White House to figure out what there up to.

  • Scottymac54

    I believe a lot of this bluster over tax increases for the rich has its root in the fact there will soon be tremendous cuts to the military, and the military industrial complex.  Many have become dependent on the government directly by way of military salaries and perks, and gigantic corporations can only survive by engineering unjust wars to finance industry.

    Increasing numbers of Americans are waking up to the difference between guarding our borders and interests, and a rogue internationalist mercenary force that no longer serves a majority of the people, are no longer appreciated or valued, and have devolved into the nation’s largest fiscal liability, and an ineffective bulwark against tyranny and fear.

    As a new comprehensive framework is rolled out against a fundamental shift in national values and an increasing backdrop of social tension, priorities will turn toward the promotion of increasingly lucrative cottage industries, and small-scale entreprenurial ventures that offer independence and reliable prosperity will replace controllers’ “free markets”, the servitude economy and a military career as a fallback to failed career prospects in a shrinking private sector.

  • Tdsears28

    If I play craps…and win big….and then buy a few successful companies with my jackpot….would I be considered a genius / guru? Then I could buy a big gob of tax free bonds. And then I could give a pass to one of my employees who clearly participated in insider trading and then moved on to a very lucrative job.  And….then, sitting on that cushion of tax-free bonds,  I could advise normal, every-day American business owners that they should pay more taxes ….. perhaps as a tax on their efforts.  How many tax free bonds do I need to purchase before I can ask Mr. Buffett to shut up?

    Democrats simply feel those type of efforts are property of the commune.

  • Greta

    I’m going to go out on a limb here but this is just my honest opinion.  I wouldn’t let the fact that Buffet owes taxes discount the logic in what he is saying.  He makes a very logical point.  How does raising taxes on the megarich (investors) hurt the economy?  If someone wants to invest money, why would they not invest just bc tax rate is higher.  They will still make money. For a simple example, if someone invests 100K and expects to earn 10%, that’s 10K profit.  Let’s say 10% tax rate (again, for simplicity), they pay 1K and keep 9K.  What if they raise taxes to 15%?  They pay 5K and keep 5K.  Add that to the original 10K they invested and they have 15K.  They still have 5K more than they started out with.  Why would an investor decide not to invest just bc the tax rate increased?  If they don’t invest, they make nothing.  If they do invest, they make money.  Investors are investors bc they like to make money.  They will still invest even with higher tax rate bc that’s just what they do.  So what is the harm in asking investors to pay more to help pay down the debt?  This is an honest and reasonable question.  These are hard times and we are all going to feel the pain of dealing with the debt.  I’m game for it bc it is best in the long run.  Why should megarich be exempt from feeling pain?  So please don’t discount the logic of what Buffet is saying.  If you think about it, it makes perfect sense.

    • Ferd_Berfle

      How does raising taxes on the megarich (investors) hurt the economy?  If
      someone wants to invest money, why would they not invest just bc tax
      rate is higher.  They will still make money.
      =====================
      They will take their money elsewhere, where they cam make more money. This isn’t a zero-sum game.

      The other issue that you retrogressives fail to consider is that the money they make does not belong to the government. You proceed from the patently false assumption that because the government and liberals/retrogressives spend money in an unwise fashion, they can make up the difference by theft from the wealthy and that the money the wealthy possess is actually the government’s to take. You must disabuse yourself of the idea that your life, liberty, and the pursuit of happiness can be augmented by taking from the life, liberty, and pursuit of happiness of another. It is morally and ethically wrong. That you might have wasted your opportunity at the pursuit of the American Dream does not give you license to take from others who did not waste their opportunity. Got it?

  • Scottymac54

    Sassy, I believe it was, turned out to be correct.

    I’ve noticed that, thread after thread, the hardline neocon commenters’ posts shoot directly to the top, causing a “troll section” down at the bottom.

    Typical (but not really surprising, anymore).