The most important paycheck in the world

Warren Buffett’s secretary, Debra Bosanek, is unquestionably one of the most important people in America, and her paycheck stub is one of the most significant documents in the world.  The entire U.S. tax code stands on the verge of being overhauled, and a gigantic job-killing tax slapped on upper income earners, because she ostensibly pays a higher tax rate than her billionaire boss. 

So vital is Bosanek to the future of America that she was invited to sit in a place of honor beside the First Lady at the State of the Union address, a position usually reserved for heroes who have survived dangerous adventures, or the victims of awful tragedies.  She was actually mentioned by President Obama in the State of the Union address:

When it comes to the deficit, we’ve already agreed to more than $2 trillion in cuts and savings. But we need to do more, and that means making choices. Right now, we’re poised to spend nearly $1 trillion more on what was supposed to be a temporary tax break for the wealthiest 2 percent of Americans. Right now, because of loopholes and shelters in the tax code, a quarter of all millionaires pay lower tax rates than millions of middle-class households. Right now, Warren Buffett pays a lower tax rate than his secretary.

Do we want to keep these tax cuts for the wealthiest Americans? Or do we want to keep our investments in everything else – like education and medical research; a strong military and care for our veterans? Because if we’re serious about paying down our debt, we can’t do both.

And yet, to this day, Americans do not know one single detail about the taxes or income of the woman who will become the template for our system of punitive taxation.  How much does Bosanek make?  How much does she pay in taxes? 

No one imagines for one instant that she pays more in absolute dollars than Warren Buffett.  He most likely pays hundreds of times as much, just as well-heeled presidential candidate Mitt Romney pays about 400 times as much money in taxes as the average middle-class taxpayer.  The class warfare bleating about “the rich paying their fair share” sounds less compelling when you think about taxes that way…  so of course you are never, ever told to think about them like that.

For some reason, a large number of Americans are content to accept Bosanek as the chisel that will be used to re-sculpture America’s tax system, without knowing anything about her at all.  Warren Buffett is also willing to quietly tolerate Obama’s endless harping on the “Buffett Rule,” even though as recently as September he stated in public that he had nothing to do with drafting it, and Buffett himself only recommends tax increases on people who make over $50 million per year.  As long as leftist class-warfare pieties are respected, and the government gets some more of our money to spend, who cares about the details?

Buffett himself has stated Bosanek pays a 38.5 percent tax rate.  There is no reason to take such important information on faith from anyone – we are still nominally free people in America, not servants required to trust and obey our betters without challenge – but if that’s her nominal federal tax rate, she makes over $379,150 per year, according to the IRS tax tables.  If 38.5 percent is her total nominal federal and state tax burden, given Nebraska’s top rate of 6.84 percent on incomes above $27,000 per year, she would have to make between $174,000 and $379,150 per year.

Paul Gregory at Forbes decided to try estimating what Bosanek’s income would be, based on the only thing we know about her finances with absolute certainty: her effective tax rate is higher than what Warren Buffett pays on his enormous capital gains.  Gregory concluded that Bosanek would have to make at least $200,000 a year to pay a higher rate.

Various respondents to Gregory’s column pointed out flaws in this simple methodology.  (Nothing about taxes is simple, once you get past the bottom brackets, which the secretary of a billionaire most certainly does not occupy.)  One of the biggest complications is that the comparison we’re supposed to accept, in order to surrender more control over the American economy to President Solyndra, is between effective tax rates.  In other words, we’re supposed to compare the dollar amounts paid by Buffett and Bosanek to their total incomes, factoring in all the deductions, exemptions, and other gears turning within history’s most complex tax code.  Class warriors sometimes like to dishonestly compare effective tax rates for the wealthy with nominal tax rates (in other words, the rates printed in the IRS booklet for various gross income levels) for the little guys.

With this taken into account, it would be possible for Bosanek to reach a higher effective rate than Buffett with a lower six-figure income, but her salary would still have to be over $100,000 per year.  That’s assuming she doesn’t have any capital gains, or other benefits taxed at a lower rate than salaried income. 

Is it very likely that she doesn’t have any such benefits, considering that she has been working for Warren Buffett since she was 17… and she is now 55 years old?  Does anyone who still retains the mental capacity to question Barack Obama’s rhetoric seriously believe Bosanek spent 38 years working for one of the richest men in America without building up a six-figure salary, plus some impressive benefits?  What would it say about Warren Buffett, Obama’s economic guru and favorite liberal billionaire, if she hasn’t?

The dreaded and evil top One Percent of income earners begin at $350,000 per year, while the top 5 percent begin at $150,000.  Barack Obama’s often-stated socialist dogma says that any married person who makes over $200,000 per year is a “millionaire.”  Therefore, Debbie Bosanek is quite possibly in the top One Percent, almost certainly in the top 5 percent, and very likely a “millionaire.”  None of this is very helpful to Obama’s crude class-envy arguments.  A vast number of people who earn less than Bosanek probably does also pay a much lower tax rate than Warren Buffett.  47 percent of Americans pay no income tax at all.

As it happens, there is one other detail we peasants are allowed to know about Debbie Bosanek’s finances: she and her husband just bought a second home in Arizona, “a residence complete with a swimming pool and a professional PGA putting green,” according to The Smoking Gun.  The new home was purchased for $144,000, while the couple’s primary residence is a four-bedroom, 2568-square-foot home near Buffett’s corporate HQ, assessed at $217,716 last year.  How many of you bitterly envious, hardscrabble hate-the-rich type own over $350,000 in real estate?  (And that primary residence probably cost a lot more than $217k before Barney Frank and Chris Dodd got hold of the U.S. housing market.)

Bosanek is a private person who almost never grants interviews, besides sharing a few words with ABC News on the eve of the State of the Union address, which she was understandably excited about attending:

With all due sympathy for Mrs. Bosanek – and sincere hope that her long association with Warren Buffett has been very, very good for her – that is no longer acceptable.  The President didn’t just mention her once in passing, as an anecdote to introduce a single speech.  He’s been talking about her for a long time, as a pivotal part of his appeal for raising taxes on the rich.  America is not a monarchy, in which the King may invite anyone into his court that he pleases, and the peons are allowed nothing but the occasional glimpse of her face.  How characteristically arrogant of Barack Obama, to use a private individual as a bludgeon against the American people, possibly without asking her permission… and then tell us we are allowed to know nothing about her, beyond what he and Warren Buffett choose to tell us, which we’re supposed to accept without question… and without asking any further questions.

I recommend every free American citizen insist on either seeing some hard, well-documented numbers, or insist that we never hear another word about Debra Bosanek, ever again.  I’m all in favor of respecting her wishes for privacy.  She seems like a nice lady, and her loyalty and dedication to her job are admirable.  We should be happy to know that much about her, and need to know nothing more.  Let Obama make his class warfare arguments with reason, instead of human props.


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