Warren Buffett spoke with Bloomberg Television’s Betty Liu about his proposed tax on the ultra-rich, the economy and jobs creation.
Buffett said that the tax on the ultra-wealthy may 'raise as much as $20bn per year' and that if there were a group that would agree to write a check to the government, he 'will join them'.
Buffett on stepping out to advocate the tax rule for the ultra-wealthy
'It’s to have the ultra-rich who are paying very low tax rates pay more taxes. There’s all kinds of ultra-rich who pay normal taxes, but there’s a small segment who pay very low taxes including me. People who make money with money only pay very low taxes at very high levels of income. People with jobs like yours or all those around us pay perfectly normal taxes. What I am talking about would apply to 50,000 people out of 310 million in the country. It would simply mean that if you make tens of millions of dollars and your tax rate was 16% or 17%, you would start paying like the person who made $100,000 or $10 million who paid normal tax rates. An athlete making $10 million would not have a change in his tax rate at all. Somebody who buys a stock index future and sells it 10 seconds later and gets 60% by long-term gains, he would have a different world to live in'.
On whether he’s heard from people who qualify as ultra-rich
'I get some letters (that are negative), but I get more letters saying thanks. A lot of people do not understand it. It would really only apply to about 50,000 people. The rest of it would be unchanged. But it would raise as much as $20 billion per year. That’s $1,000 to 20 million families. If you give me a choice between taking $1,000 from 20 million families or hitting 50,000 people who shuffle money around all day, I will take it from the people who shuffle money'.
On why he doesn’t just write a check to the government
'If you have a trillion dollar plus deficit and you have this child-like faith that people can solve that by writing checks to the government, I sort of admire it. I heard Senator McConnell suggest that. I think it’s wonderful that he has such faith in the American people that he wants to solve a trillion dollar deficit problem by people voluntarily sending checks to the government. If something should be policy, it should be enacted as policy.......If there were a group of ultra-rich people who wanted to take that out as a program, I will join with them'.
On Governor Rick Perry saying that Buffett doesn’t know what’s going on in the places where job creation is zero
'I think it’s a real problem of society but it will not be hurt in the least. The top 400 in taxpayers in 2009 averaged $227 million of income per person. The economy will not be hurt at all by taxing those who paid low rates at a higher rate. Creating jobs. We have billions in cash at Berkshire that we are looking to put out to satisfy demands of customers and that creates jobs…Jobs are created by demand. The capital that supports demand is huge. There is $1 trillion plus at the Federal Reserve left by banks earning 0.25%. They do not want to leave it there. They want to put it into business that need it. There has been an increase in need, But it isn’t galloping'.
On President Obama’s jobs plan
'I have not looked at all of the details of the plan. What I look to do is when they coalesce around a plan I will look at it and see if it will work. The real question is whether you can get a majority of Congress and the Administration to agree on something to move the country forward, and we’ll see what happens on that'.
On whether Obama’s plan will get CEOs to start hiring
'It’s a stimulus plan and fiscal stimulus is one piece of the pie in keeping a recovery going. We have a recovery going. We are not in a double-dip recession or anything like that. I’ve got 70 something business and most of them are doing very well. Fiscal stimulus, monetary policy, those are the conventional tools. We’ve used them big time already. I don’t think that fiscal stimulus or monetary policy from this point forth will do a lot, to be perfectly honest'.
On whether Berkshire would help bail out lenders in Europe
'They need capital in their banks, in many of their banks, but they have not called us. Not quite none at all. We would not be a good prospect'.
Source - Bloomberg TV
Have something to tell us about this article?