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Buffett: “Higher Taxes on the Ultra-Rich is Not Going to Solve the Deficit Problem”

John on October 3, 2011 at 12:04 am

According to the description provided by the person who uploaded this clip, Buffett spoke at a lunch for Business Wire on Friday. That means he said this just a few hours after the comments that caused such a kerfuffle over the Buffett Rule Friday morning:

Having higher taxes on the ultra rich is not going to solve the deficit problem but no one act is going to solve it. We are going to need a lot of shared sacrifice in order to get our fiscal situation where it should be for a country like this.

We’re going to ask something from everybody including people that are poor and people that are middle class. And getting an extra $20 billion from about 50,000 people out of 310 million in this country, 50,000 people who are enjoying terrific incomes with very low tax rates.

I actually think he makes a better case for this than Obama ever has. Still, he’s really making an understatement of epic proportions saying this won’t solve the deficit problem. In case you’re wondering, $20 billion goes into $1.3 trillion 65 times. So this new tax would solve roughly 1.5% of our annual deficit last year. Not only is that not a solution it’s hardly worth talking about.

Again, I give Buffett credit for stating the obvious, but it begs the question that should be asked, i.e. why is the President devoting so much time and energy to solving 1.5% of the problem?

Oh, I know that the President isn’t just talking about the Buffett Rule, but ending the Bush tax cuts on those making over $250k only adds about $40 billion a year more. All told that’s 4% of the problem. He’s been focused on this 4.5% for at least two months now. Does that make a lot of sense to you? It does if you assume this is about politics and not solving the deficit problem.

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Category: Energy & Economy, Politics |

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