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The Truth, Mainly - 12/03/2007

Warren Buffett, rich guy, good guy

As a Depression baby, I grew up liking poor people better than I liked rich people. I suppose it was partly because there were many more poor people in our Baptist church than there were rich people, and the poor majority's favorite Bible verse was the one in chapter 6, verse 20 of St. Luke that quotes Jesus saying: "Blessed be ye poor: for yours is the kingdom of God."

I suppose there are Biblical passages that say nice things about rich folks too, but we never talked about them in our church.

My father, who was born and grew up in an honest-to-God sodhouse, probably had something to do with my anti-rich prejudice. It wasn't that my father wouldn't like to become a little rich himself—at least rich enough that he might be able to buy a new Buick. And in 1940 he did. A brand new Buick that he went to Flint, Michigan to buy right off the assembly line.

He had it for nearly a month before he wrecked it while he was showing his buddies how fast it would go. He was tooling along just ahead of his buddy, the county sheriff, when he came up over a slightly elevated spot on the dirt road where the other side was occupied by a heard of cattle who had decided that it was time to cross the road.

My father wasn't badly hurt but the Buick was a mess. And he was chided for driving too fast by the richest of the Baptist church congregation. Which made our whole family decide that moneyed folks weren't very likeable. And my mother decided that my father should become somewhat like Miniver Cheevy, the title character in a poem written by E.A. Robinson nearly a century ago:

"Miniver scorned the gold he sought,

But sore annoyed was he without it;

Miniver thought, and thought, and thought,

And thought about it."

But I digress. All that reminiscence came to mind a couple of weeks ago when Warren Buffett, the second most richest man in America. testified before the U.S. Senate Finance Committee in defense of the federal estate tax. That's a tax on inherited wealth and it's been around since 1916. President Bush—and others who are in line to inherit big bucks—want to do away with it.

They call it the death tax.

It's the kind of tax that English majors don't need to worry too much about because the vast majority of us won't leave an estate of $2 million or more, the point at which the current estate tax kicks in.

But people like Warren Buffett, whose estate is currently worth about $52 billion, second only to the estate of Bill Gates, would pay a whole lot.

And get this: he's all in favor of doing it.

The Truth, Mainly


Here's what ticks Buffett off: he was taxed at 17.7 percent on the $46 million he made last year. But his secretary, who earned $60,000 last year, was taxed at 30 percent of her income. And—are you ready for this?—he's not ticked off because he had to pay more than she did. He's ticked off because his tax was based on barely half the percentage as his secretary's was.

He told the U.S. Senate Finance Committee that "I think we need to…take a little more out of the hides of guys like me."

And he said that the richest among us "pay a lower part of our income than our receptionists do, or our cleaning ladies, for that matter. If you're in the luckiest 1 percent of humanity, you owe it to the rest of humanity to think about the other 99 per cent."

This from a guy who still lives in an Omaha house that he paid $31,500 for in 1958.

How many billionaires do you know who are willing to protest their secretaries being taxed at a greater percentage of their income than the billionaires are taxed?

It's enough to give even an English major the fantods. And it moved Buffett to tell the Senate Finance Committee that "Dynastic wealth, the enemy of meritocracy, is on the rise….Equality of Opportunity has been on the decline. A progressive and meaningful estate tax is needed to curb the movement of a democracy toward plutocracy."

And when Republican Chairman Charles Grassley said that "the death tax" was "fundamentally wrong," Buffett said that the use of "death tax" was "intellectually dishonest" and "clever, Orwellian, and dead wrong."

Tough Talk, but that's what you're asking for when you cross your understanding of how money works with the understanding of someone called the Oracle of Omaha.


Retired English Professor Leon Satterfield writes to salvage clarity from his confusion. His column appears on alternate Mondays. His e-mail address is: leonsatterfield@earthlink.net.


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