Posted on 10/11/2005 6:56:11 AM PDT by stevestras
The appearance of Bill Gates and Warren Buffett at the Lied Center last week was a reminder of the fluidity in American society that allows talent and drive not birthright and connection to earn power and wealth.
Although both men came from comfortable backgrounds, neither was born to that old wealth stratum of American society that sometimes seems to be tantamount to an aristocracy.
Dressed casually, they sat on a couple of stools, cracking jokes, speaking plainly, fielding unscripted questions. They seemed like ordinary people, very normal, very knowledgeable and funny, observed Yong Zhao, a University of Nebraska-Lincoln graduate student from China.
Their appearance is an example of the sort of inspiring, indelible personal experiences that are an important part of a university education. This sort of special event even last years entertaining visit by rocker Tommy Lee fits the category is part of a full and varied campus life.
The audience of 1,800 was UNL business students. The appearance will be shared with all Nebraskans next year on NET.
Their comments veered widely from the humorous Gates admitted that colleagues at Microsoft blow him away when he plays video games like Halo 2 to the profound Buffett defined success as being loved by the people you hope love you.
If any students came to the session with a preconception that all the nations rich and powerful share the same low-tax political philosophy, they went away with a different impression.
Both Buffett and Gates said that they should pay more in taxes. The rich should bear a somewhat higher proportion than they are now, Gates said.
Im paying less than half of what I was paying years ago when I was making a lot less, Buffett said. There are people fighting in Iraq paying higher rates than mine.
Perhaps most encouraging was the belief expressed by both billionaires that everyone can help make the world a better place.
Gates suggested that students gain an exposure to living conditions in other places. Things are improving and there are places for people to jump in. Buffett told one student that she and by extension every individual changes the world every day by the way she behaves around other people.
At a time when American society seems rife with cronyism and Enron-style corruption at high levels, the comments from the two icons of business success, delivered in a relaxed, ordinary, disarming style, provided reassurance that basic American ideals endure that merit, hard work, optimism and decency can prevail.
statement2: "There are people fighting in Iraq paying higher rates than mine"
The first statement in no way supports the second or vice versa.
more <> higher rate
That is true.
However, speaking to an audience of college students, I'm sure they didn't catch the nuance of it. For that reason, it may be more accurate than you think.
Dear Toddsterpatriot,
Even with the AMT, I think that if nearly all your income is dividends from public companies, you're just going to pay the 15%. Mr. Gates will lose the deductibility of his local property taxes, and if he owns any tax-free bonds, some of them may lose their tax-free status (although others will not), but I don't think the rate changes on dividends.
A quick review from google shows that long-term capital gains rates remain the same under the AMT, and I'm guessing so do taxable dividends paid on shares in "C" companies.
I'm unclear about the limitations on charitable contributions, but I'm sure that Mr. Gates has structured these to take maximum advantage of tax laws. I think that the deductibility is limited to half of one's income for the given year (but that's from memory, I don't recall precisely).
By the way, I forgot that late last year, Microsoft declared an extraordinary dividend, which paid Mr. Gates somewhere around $3 billion.
sitetest
"Im paying less than half of what I was paying years ago when I was making a lot less, Buffett said. There are people fighting in Iraq paying higher rates than mine. "
Pure BS. Unless he is making about $50,000, he pays the highest rate possible.
Don't forget his $1,000,000 salary. It's safe to say he paid more $$ and a higher rate than any soldier in Iraq.
"The current tax code (NOT tax rates) benefits the rich."
Don't know much about the tax code, do you?
Class envy and class warfare are no way to build a country.
Dear Toddsterpatriot,
"Don't forget his $1,000,000 salary."
Yeah, but that represents less than 1% of his total taxable income.
"It's safe to say he paid more $$ and a higher rate than any soldier in Iraq."
More money? Certainly! Perhaps more money than many thousands of soldiers put together!! LOL!!
Higher rate? I can't say because I don't really understand how the tax laws apply to folks serving in Iraq, and also, how are you going to count payroll taxes? Are you just going to look at the employee side? Then, if someone is entirely exempt from federal income taxes, the rate they're paying is a nominal 7.65%. But if you're counting the employer side (and I would), then it's nominally 15.3% of salary.
Mr. Gates, on the other hand, is likely paying 35% of his salary and bonus ($350,000), but only 15% of of his dividends (about $45 million on about $300 million). But, if he is able to fully deduct up to 50% of his income in charitable contributions (the AMT doesn't seem to disallow or reduce the deduction for charitable donations, but I'm not altogether sure about that), then it is likely that he paid about $22.5 million in income taxes on dividends, and his overall tax rate is about 7.6%:
Salary and bonus: $1 million Tax: $350,000
Dividends: ~$300 million
Charitable deduction: ~$150 million
Dividends subject to 15%, after deductions: ~$150 million
Dividend income tax: ~$22.5 million
Total tax paid: ~$22.85 million
Total income: ~$301 million
Rate: ~7.59%
For 2004, it looks more like this:
Salary and bonus: ~$950,000 Tax: ~$330,000
Dividends: ~$3.3 billion
Charitable deduction: ~$1.65 billion
Dividends subject to 15%, after deductions: ~$1.65 billion
Dividend income tax: ~$247.5 million
Total tax paid: ~$247.83 million
Total income: ~$3.30095 billion
Rate: ~7.51%
Of course, this is all simplified, and based only on information that is publicly available. The billion shares of Microsoft only account for a little more than half of Mr. Gates' reported wealth of $46 billion. I don't know where the other half is, and I don't know what kind of income it generates.
However, I'd bet that whatever income is generated elsewhere likely results in similar percentages of taxes paid.
sitetest
Well, that and having 36 Billion dollars. :0)
If you think that whole thing irks you, you ought to have heard Buffet's speech to a Senate breakfast a couple of years ago.
The theme was, "I won the ovary lottery . . ."
His premise was that he was born male, white, American, to good parents, etc, which meant he had advantages that made what he is today possible.
As if his being born any other way, with the same talents, might somehow have disqualified him from making millions in America.
The only real advantage that 'luck' played in was perhaps that he was born American. Few other country in the world affords you the opportunities you have here.
Buffet has terminal affluenza, and he's just to the right of Soros.
Military base pay is based upon grade (rank) and years of service:
Rank | <2 | 2 | 3 | 4 | 6 | 8 | 10 | 12 | 14 | 16 | 18 | 20 | 22 | 24 | 26 |
E-9 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 3769.20 | 3854.70 | 3962.40 | 4089.30 | 4216.50 | 4421.10 | 4594.20 | 4776.60 | 5054.70 |
E-8 | 0.00 | 0.00 | 0.00 | 0.00 | 0.00 | 3085.50 | 3222.00 | 3306.30 | 3407.70 | 3517.50 | 3715.50 | 3815.70 | 3986.40 | 4081.20 | 4314.30 |
E-7 | 2145.00 | 2341.20 | 2430.60 | 2549.70 | 2642.10 | 2801.40 | 2891.10 | 2980.20 | 3139.80 | 3219.60 | 3295.50 | 3341.70 | 3498.00 | 3599.10 | 3855.00 |
E-6 | 1855.50 | 2041.20 | 2131.20 | 2218.80 | 2310.00 | 2516.10 | 2596.20 | 2685.30 | 2763.30 | 2790.90 | 2809.80 | 2809.80 | 2809.80 | 2809.80 | 2809.80 |
E-5 | 1700.10 | 1813.50 | 1901.10 | 1991.10 | 2130.60 | 2250.90 | 2339.70 | 2367.90 | 2367.90 | 2367.90 | 2367.90 | 2367.90 | 2367.90 | 2367.90 | 2367.90 |
E-4 | 1558.20 | 1638.30 | 1726.80 | 1814.10 | 1891.50 | 1891.50 | 1891.50 | 1891.50 | 1891.50 | 1891.50 | 1891.50 | 1891.50 | 1891.50 | 1891.50 | 1891.50 |
E-3 | 1407.00 | 1495.50 | 1585.50 | 1585.50 | 1585.50 | 1585.50 | 1585.50 | 1585.50 | 1585.50 | 1585.50 | 1585.50 | 1585.50 | 1585.50 | 1585.50 | 1585.50 |
E-2 | 1337.70 | 1337.70 | 1337.70 | 1337.70 | 1337.70 | 1337.70 | 1337.70 | 1337.70 | 1337.70 | 1337.70 | 1337.70 | 1337.70 | 1337.70 | 1337.70 | 1337.70 |
E-1 | 1193.40 | 1193.40 | 1193.40 | 1193.40 | 1193.40 | 1193.40 | 1193.40 | 1193.40 | 1193.40 | 1193.40 | 1193.40 | 1193.40 | 1193.40 | 1193.40 | 1193.40 |
E-1 with less than 4 months of service | $1,104.00 |
So you're gonna claim that these guys paid a higher rate than Bill Gates?
And if you think I'm into the class envy/warefare thing; I don't give a $#!t about how much those two make. What I DO have a problem with is a tax code that requires tax lawyers to figure out, and even then they all don't seem to understand it.
That's just plain wrong in my opinion.
Thanks, that's an interesting scenario.
Bottom line for me is that these guys are using their positon to influence young minds that low tax rates are bad. If they have an extra 10 or 20 million, it goes back into our economy, not through the federal filter. That is good for all Americans. Combine this one example with liberal instructors accross the board and it is clear how much hard work we all have to do.
No matter if you agree with the Miers nomination, or not.
Dear Toddsterpatriot,
"So you're gonna claim that these guys paid a higher rate than Bill Gates?"
Rate? Sure, it's possible. The E9 with 26 years appears to be making around $60K per year in base salary. He's paying payroll taxes on the whole thing. Personally, I'd count the employer side, as that's budgeted by his employer (the US government) when figuring out how much is available for compensation. That gives a total payroll tax rate of 14.2% of total salary compensation (including the employer's side of payroll taxes).
Now, it appears that these folks in Iraq don't pay federal income tax, or have it refunded to them? In that case, nothing else is added to their total rate of taxation.
But Mr. Gates may very well be paying less than that 14.2%.
However, if you don't want to count the employer side of payroll taxes, then these folks are paying only 7.65%, which still may be comparable to the rate Mr. Gates is paying.
Nonetheless, Mr. Gates certainly pays, in absolute dollars, thousands of times what any individual soldier pays in income and payroll taxes.
sitetest
And how ironic is it that we argue the political feasibility of this point here on FreeRepublic, while the economic boom of the late 1990s (under a Democratic administration) was largely the result of an increasingly regressive tax policy that combined the tax hikes of 1993 (especially the higher Federal excise taxes and the new tax on Social Security benefits) and the capital gains tax cuts of 1995 and 1998 that were specifically aimed at "the rich."
My imagination is failing me.
My imagination is failing me.
"the ones who have the resources to dig into it and use it to their advantage, are the ones who make out pretty good."
To a good degree, yes, but this notion that the rich pay nothing or even less than their fair share is simply an ingorant position. The top 5% of wage earners pay 55% of all taxes collected. The bottom 25% of wage earners pay nothing!
Of all taxes? Which taxes do you include?
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