If you thought the presence of Warren Buffett’s signature on the so-called “Responsible Wealth” petition for higher estate taxes reeked of hypocrisy, thanks to Buffett’s history of personally avoiding as many taxes as possible, you only needed to wait one day to find out just how pungent that hypocrisy could grow. Reuters reports:
Warren Buffett’s $1.2 billion share buyback from a single unnamed investor likely helped that person’s estate save substantially on taxes, just one day after the Berkshire Hathaway CEO said the rich should actually be paying more, not less, when they die.
With the “fiscal cliff” looming and estate taxes set to rise dramatically in less than three weeks, the timing was seen as advantageous – and, according to Berkshire watchers, also out of place in the context of Buffett’s recent tax activism.
“I would say ‘Warren, would you please just keep your nose out of this.’ He’s not in a position to criticize what’s good for America and for everyone else’s estate,” said Anthony Sabino, a professor of business at St. John’s University. “He’s no doubt utilized the present tax code to maximum effect.”
[…] “I have a problem with Warren, who’s basically done with this (issue), to say ‘yeah, raise the estate tax,'” Sabino said.
“I think, again, with all due respect for his sagacity at selling stocks, he’s being incredibly short-sighted.”
Buffett’s move was highly unusual, given that Berkshire’s most recent quarterly filing “said it had not made any repurchases in the first nine months of 2012, after spending just $67.5 million on buybacks in 2011.”
One reason this behavior is significant is that the headline-grabbing band of tax-me millionaires always want to claim moral credit for making an argument against interest. You’re supposed to take them extra-seriously because the policies they advocate would cost them, or in this case their heirs, a great deal of money. And yet, they take aggressive (and generally legal) measures to protect their income from taxation, while adamantly refusing to set any sort of personal example by voluntarily contributing extra money to pay down the national debt.
The tax-me millionaires are dangerously counterproductive because they’re helping to obscure the true spending problem that is driving us to the edge of ruin, while laying the groundwork for policies that will retard economic growth, and seize money from people whose personal and business fortunes do not remotely resemble Warren Buffett’s. In the near future, their cries for fiscal solvency through tax increases will lay the groundwork for raising taxes on people who aren’t “rich” at all. And since they invest such energy in claiming moral supremacy for thier position, it’s worth noting that their personal commitment to handing over more cash to Uncle Sam seems less than completely sincere.