The Battle Of The One Percenters

We have been struggling with Warren Buffet's secretary, the self-described "average citizen" whose tax rate is so famously higher than her boss's.

Per ABC News, Ms. Bosanek pays a tax rate of 35.8% of her income; it is clear from the interview that Mr. Buffet included Social Security and Medicare taxes in that calculation, as he ought to.

What is not clear at all is just how much she is earning to attain that tax rate.  It is also plausible that Mr. Buffet made some unwarranted assumptions in performing his analysis - for example, he claims that Ms. Bosanek and her husband pay Social Security on "slightly over" two hundred thousand of income, but that elides the fact that her share of that is capped at W2 income of $106,800.  Including her husband's Social Security in her tax calculation makes little sense (but that doesn't mean it didn't happen).

So loose the hounds!  With this H&R Block income calculator for 2011 we can *approximate* her possible taxes for 2010.  For example, with income of $190,000 a married woman filing separately with the standard deduction and exemption will have a Federal income tax liability of $49,357.  

To that we should add her *capped* share of Social Security: 6.2% x $106,800 = $6,622.

Medicare is not capped, so let's add 1.45% x her W2 income: 1.45% x $190,000 = $2,755

And let's not forget the employer's share!  Per the Congressional Budget Office, the employers share of payroll taxes is ultimately borne by the worker:

The burden of taxes levied on businesses actually falls on households. In line with most economists, CBO assumes that the employer's share of payroll taxes falls on employees and thus assigns those payments to employees both as income and taxes paid. 

So with these adjustments, let's add those payroll taxes once again for the employer's share.  If we do that, we will calculate total taxes of $68,110.  A casual calculation of her effective tax rate would be:

    $68,110 / $190,000 = 35.8%.

Bingo!  Well, actually, bingo... First, this is only a lower bound for her income.  If Ms. Bosanek has more deductions and exemptions or favored income such as capital gains, her actual income could be higher.  And we are sidelining her hubby here.

Secondly, this casual calculation overlooked a key point of the CBO caveat - if we add the employer share of taxes back to her taxes, we "ought" to add it back to her income as well.  Ooops!  It would not surprise me to learn that Team Buffet did not do that.  With that adjustment, Ms. Bosanek's income (W2 plus imputed payroll taxes) is revised:

    $190,000 + $6,622 + $2,755 = $199,377

This leads to a new effective tax rate of $68,110 / $199,377, or 34.2%.  Hmm - where is our 35.8%?  One wonders whether Team Buffet avoided this mistake and made the imputed income adjustment.  In that case, Ms. Bosanek would need W2 income of $475,000 to get to a 35.8% rate.  Seems high, but literalists would back this number.

And from the other direction, suppose Team Buffett chose to apply a Social Security cap of $213,600, to reflect the combined cap of husband and wife.  That is a plausible, if not really defensible, error.  But if they went with a spousal cap *and* failed to add back the imputed payroll taxes to income, they might have started with W2 income of $115,000 and concluded that her effective rate was 35.8%:

W2 Income:  $115,000

Federal tax:   $23,575   (From H&R Block)

Social Security:  $7,130 x 2 = $14,260 (Includes employer share with the spousal cap).

Medicare:          $1,668 x 2 = $3,366

Total Taxes:    $41,171

Effective Rate:  35.8%  Based on W2 income of $115,000

Revised effective rate:  33.3%  Based on imputed income totalling $123,798.

Well - we could conjugate guesses all day.  If this "average" secretary is earning $475,000 on her own, well, we all want to be average.  On the other hand, she might be earning around $115,000 or (with other possible errors and interpretations) even less.  Release the returns!

OBVIOUSLY SHE HAS GOTTEN SOME PRODUCTIVITY RAISES:  Back in 2007 Warren Buffet spoke at a Hillary fundraiser:

Mr Buffett said that he was taxed at 17.7 per cent on the $46 million he made last year, without trying to avoid paying higher taxes, while his secretary, who earned $60,000, was taxed at 30 per cent. Mr Buffett told his audience, which included John Mack, the chairman of Morgan Stanley, and Alan Patricof, the founder of the US branch of Apax Partners, that US government policy had accentuated a disparity of wealth that hurt the economy by stifling opportunity and motivation.

Well, let's raise that to $75,000 of W2 income today - with imputed income and taxes that works out to an effective rate of 30.4% on her W2 income and 28.2% with the imputed payroll tax income added back.  35.8% is a long way away.

LOOKS LIKE I SCORED THAT XANAX FOR NOTHING... After all this research, for the first time in my adult life I am excited about diving into my taxes.  Next step - lie down until the feeling passes...

Comments

[Danube of Thought]

Too much arithmetic here.

[NK]

When I started reading this blog I was told there would be no math.

TomM a friend of 32 years is the IRS Asst Comm. for enforcement-- yes he IS THE tax collector for the welfare state-- shall I ask him to pull the return and send it to you-- no? what's that? we'd all go to jail even for asking, and 'Bam's WH employees don't even pay their taxes? what a country.

[Ignatz]

--Per ABC News, Ms. Bosanek pays a tax rate of 35.8% of her income; it is clear from the interview that Mr. Buffet included Social Security and Medicare taxes in that calculation, as he ought to.--

Why?
If Buffet achieves his tax rate by being taxed on cap gains and carried interest he is not earning any credit toward either Social Security or Medicare. She is receiving a benefit for the extra taxes thrown into the calculation that he is not, which makes it apples and oranges, doesn't it?
If you'd like to see how much each person is paying toward the citizen's general obligation to fund the government's ongoing operations and not their own retirement program as well then compare her bare income tax rate and any cap gains taxes she pays to whatever his are.

If Buffet's argument is that SS and Medicare should be welfare programs funded from the general Treasury then let him say so.

[jimmyk]

It's not clear from the article whether 35.8% is marginal or average, whether it includes state/local taxes, FICA/Medicare and so on. I agree, if you're going to let yourself be used as a campaign prop, release your return.

And of course there's the big question of whether FICA should really be lumped in with other taxes, since to some extent you get that back as a pension benefit (notwithstanding that it all goes into the big stinking pot in our federal government's sausage factory).

[jimmyk]

Iggie beat me to it on SS.

Another point: If Obama wants a millionaire surtax on investment income, watch the muni bond market tank, and all the ripple effects from that. It won't be pretty.

[Jim,MtnViewCA,USA]

"Too much arithmetic..."
Au contraire. The man is on a roll! Is it not true that he revels in examining issues in microscopic detail from multiple angles?

Who would deny him his simple-hearted joy? :)

[Jim Rhoads a/k/a vnjagvet]

The Buffet gang could at least show their work even if she doesn't want to release her tax returns.

[George]

Would it be libelous or slanderous or just a breach of the rule that Warren Buffett is just a great guy to suggest that he might be overpaying a loyal employee of 38 years who has copies of those phone message logs and meeting minutes from just before Berkshire Hathaway invested in some omniscent way?

[MarkO]

I feel certain that someone promised there would be no math.

[peter]

Brilliant point, Ignatz.

"DOES CROW HAVE A PLACE IN A LOW-CARB DIET? "

Too funny, Mr. Maguire

[cathyf]

I just posted this on the other thread, and the math is much simpler than you are making it out to be:

If you are a self-employed independent contractor who fills out a Schedule C, and your husband is a w-2 employee who makes about the median salary, then, as long as you make less than the SS maximum, your marginal tax rate is 41.12955%

(28% + 15.3% * (1.0-0.065) = 41.12955% for those interested in the math)

Example of such a person -- a Pampered Chef consultant who makes $20,000/yr to supplement her husband's $45K/yr salary as a computer programmer. If she didn't do the Pampered Chef at all, they would get all of the same deductions when married-filing-jointly, so the $20K of PC income directly results in taxes of $8,425.91.

And that doesn't even count the state income taxes.

Except, damnit, I did it wrong -- the 28% is also reduced by 0.9235 -- that happens on the front side of the 1040 before you start in on the Schedule C.

(28% + 15.3%) * (1.0-0.065) = 39.98755%

Or, to take Ms. Bosanek and her husband, if each makes $100K (right at the top of the SS cutoff), and you are looking at her MARGINAL rate, then that's pretty clearly about 40%.

I've been the Schedule C mom with the W-2 husband. When buying things that would be deductible on the C, I always figured that it was costing me about 55% of the sticker price after the tax savings.

[Extraneus]

What is she hiding? That's what I'd like to know.

[cathyf]

Oh, and Iggy, as per your claim that Ms. Bosanek is getting some extra benefit from her 14.13% ss/medicare taxes -- about 80% of all working women take their benefits as the spouse based upon their husband's earnings, not based upon their own, so any social security that they get is precisely the same as if they had never worked a day and never paid a dime in social security or medicare taxes.

[Lori]

As Buffett's long time secretary I am sure she has been awarded more than a few Berkshire Hathaway shares. Maybe this has been disclosed and I missed it. Someday she will sell those and she can blame herself for taking part in this fiasco when she is forced to pay higher capital gains taxes.

[cathyf]

If it is true that Ms. Bosanek paid 35.8% rather than 40%, it might just be that she had some capital gains income to reduce her marginal rate.

[Neo]

Mr. Buffett also wrote that his secretary, who makes $60,000 a year, pays over 30 percent of her income in taxes.

[Pete]

Heck, no matter how little money my wife makes she is taxed at my rate. Its that little think called a marriage penalty and Obama wants to increase it severely and I never here a complaint about that part of his tax plan.

[NK]

Neo-- if WARREN EFFIN' BUFFETT's secretary really makes $60K/year, I immediately will have a sitdown with my secretary and tell him he's getting a paycut, effective 2009!
If her nominal salary is $60K she's getting alot of investment income from B/H share options which may further muddle her tax situation. Either that or 'George' above is right that she's getting paid under the table to keep her mouth shut about the timing of warren's call to stockbrokers just before mergers are announced. Buffett is going to rue the day he got involved in this discussion.

[cathyf]

Let's see... If the salary was $60K, and the tax rate was 35.8%,

$60K*(40-35.8) = $CG*(35.8-15)

$CG = $12,115

So she had $12,115 in capital gains.

This is an interesting discussion about the marriage penalty -- but perhaps that wasn't quite what Obama was getting at? I can't believe that he would drop this right into the middle of the "Romney should release his tax returns" kerfuffle. Everybody has just been saying how silly it is not to release tax returns...

[wr]

There are way to many degrees of freedom in the tax code, ABC description, and potential analytical/computational approaches to reliably infer anything about income levels here. As another example of the latter, it could be that Ms. Bosanek files jointly with here husband, and the tax rate is based on the assumption that Ms. Bosanek's income is "stacked" on top of her husband's in the calculation (i.e. it is assumed that her income is the marginal income in the rate computation). This could make Neo's observation (at 12:42) consistent with a rather high tax rate.

[cathyf]

wr, it's not just that the income is "stacked" atop her husband's, but that every deduction, credit, dependent etc. is on the bottom of the "stack."

This IS the flat tax, baby. 40%, no matter how little you make.

[Ranger]

Via Althouse:

Despite Unfair Tax Burden, Warren Buffett's Secretary Was Just Able To Buy A Second Home

Prof. Althouse comments:

Oh, now, now. I clicked through to the pictures of the house, pool, and putting green and it's not really that nice.

She does know exacly how the MSM will react to this sort of news.

[sbw]

If Newt lied on the CNN debate about having contacted CNN about his second wife he's toast.

The only two who can lie to the American people and get away with it are Slick Willie and the big Zero.

[Tom Maguire]

Who would deny him his simple-hearted joy? :)

I like to think of myself as the Rainman of stuff that has been overlooked with good reason. Well, on a good day.

[Ignatz]

--Oh, and Iggy, as per your claim that Ms. Bosanek is getting some extra benefit from her 14.13% ss/medicare taxes -- about 80% of all working women take their benefits as the spouse based upon their husband's earnings, not based upon their own, so any social security that they get is precisely the same as if they had never worked a day and never paid a dime in social security or medicare taxes.--

cathy,
1. The money paid in by people who take their SS based on their spouse's earnings still fund the program which makes spousal benefits possible. So their taxes support and fund a benefit they receive, which cap gains taxes don't.
2. Should we assume the secretary for the world's second or third richest man is one of the 20% or one of the 80?

[rse]

Gee it's the real Tom McGuire. Cool.

LUN is a good overview of Murray's new book with some more solid points. Not surprising I believe there's more going on with higher ed that Murray or Vedder but it's a start.

One point I would make on the both parents capable and bright front is that i makes it so critical that K-12 be solid. If you have 2 parents who model solid verbal reasoning and talk about history or science or current events as normal parts of conversation and who can step in and fix bad reading practices or math instruction, there's a real limit on how much bad K-12 can really hurt. They are fatal otherwise and that's what we are seeing all over the world as the gifted track or special schools if you test well are being phased out. Then there really is no social elevator out and we all lose. A bright mind that can break away from the circumstances they were born into is precious indeed. Not just going through the motions can become quite the beneficial dynamo.

[cathyf]

Should we assume the secretary for the world's second or third richest man is one of the 20% or one of the 80?

If she makes ~$60k, and the family makes ~$200K, then Mr Bosanek makes ~$160K. She is pretty much for sure going to take her social security based upon Mr Bosanek's tax payments.

The money paid in by people who take their SS based on their spouse's earnings still fund the program which makes spousal benefits possible. So their taxes support and fund a benefit they receive, which cap gains taxes don't.

Bullshit. The working wives pay in and get nothing more than the stay-at-home wives who never put anything in. That may be useful, good, right, whatever, but it is a canonical example of a straightforward tax totally decoupled from any individual benefit to the taxpayer. Completely indistinguishable from the 28% called "income" tax. Or the 15% called "capital gains" tax.

[Ignatz]

--If she makes ~$60k--

Then she ought to ask Warren for a raise. He can afford it.

--The working wives pay in and get nothing more than the stay-at-home wives who never put anything in. That may be useful, good, right, whatever, but it is a canonical example of a straightforward tax totally decoupled from any individual benefit to the taxpayer.--

What's the solution?
Women who work but end up with SS based on their husbands' earnings should receive a rebate for their contributions?
In which case their hubby's rate will have to rise pretty dramatically if 80% of working women will have their FICA refunded to make things fair.
Which gets us back to the benefit they receive from the taxes they pay.

[Ranger]

Oh my, can you say Hostage Crisis?

U.S. outrage as Egypt bars Americans from leaving

(Reuters) - Six Americans working for publicly funded U.S. organizations promoting democracy in Egypt have been barred from leaving the country, provoking angry demands in Washington that Cairo's new military rulers stop "endangering American lives".

Among those hit by travel bans - one of those targeted called it "de facto detention" - is a son of U.S. Transportation Secretary Ray LaHood, as well as other foreign staffers of the International Republican Institute and National Democratic Institute, officials at the two organizations said on Thursday.

How's that Arab Spring workin out for ya Barry?

[Neo]

Update: apparently, she makes $60K. So I gather what Buffet is talking about is comparing her federal marginal tax rate, including both sides of the employer tax, to what must be his effective tax rate, since there is no marginal rate of 17.4%. That comparison is beyond bizarre.

[cathyf]

What's the solution?

Call it a tax.

Oh, right, you don't want to do that, because then you would have to admit that not all taxes are progressive or flat.

[maryrose]

cathyf:
I totally trust you when it comes to numbers.My husband is the Schedule C and I am the W-2 and believe me we've paid more than our share of taxes. TerAysuh Kerry paid less than us.

[Ignatz]

--Call it a tax.--

I already do. That didn't seem to solve anything.

--Oh, right, you don't want to do that, because then you would have to admit that not all taxes are progressive or flat.--

Regressive taxes definitely exist and are generally not favored by those paying them.
I'm sensing you may be taking SS based on your husband's contributions and are commenting accordingly, but I could be mistaken.

[boris]

"Oh, right, you don't want to do that, because ..."

Of course it is a tax ... to fund a specific benefit. The beneficiaries don't want to give up the benefit and the government does not want to give up the revenue so for the time being we are stuck with it ... because ...

... no benefit = no revenue.

But it still is not fair to use it in comparison to income that avoids both the benefit and the revenue.

[Ralph L]

From what I understand, an increase in SS taxes paid does not lead to a proportional increase in benefits received. Lower income people get a much better return than higher, so it was already a welfare program before they started taxing benefits of people with other income.

Did TM use the reduced FICA tax rate?

[cathyf]

When I was the sched C and DrF was the W-2, we paid 50% tax rate on my income (28% income, 15.3% self-employment, 7% state) up until it reached the SSN max, and then it went down to ~38% for the rest. If I was going to buy something like a computer, office furniture, etc., I always had in my mind, "well I'm only really paying for half of this." Later when my income went above the SS cut off, I was less sanguine -- because my share was above 60%.

A tax where the rate goes down as the income goes up is a regressive tax. Or you could say that the sign of the first derivative is negative. Or that the rate slopes downward.

And, furthermore, I was born in 1963, and I think that the idea that I will ever see a penny in social security benefits is delusional. Whether based on my income or DrF's. My birth cohort was the largest in the baby boom, and there are 17 years of baby boomers that retire before me. All of the money will be gone. All of the "social security" tax money that I have paid in my life is already spent, buying things like bridges to nowhere and buildings in West Virginia named after Robert Byrd. More importantly, all of the "social security" tax money that I will ever pay in the future is already spent, too. By you greedy old people who took my money, and borrowed against my future money, so that the government could spend way more money on you than you paid in taxes. And since you didn't pay much in taxes you got to save for your retirement, something I could never do and can't ever do. But even if I could the money you have borrowed has already irrevocably debased the currency so that my piddly little savings will be simply worthless when I get old.

I don't know how many times I've heard that poor people don't pay any taxes when the truth is that they don't pay much or any income taxes. 15% is not chicken feed, and everybody pays it whether they earn $100 or $100,000. Except that if they earn a million dollars, then they only pay the 12.4% ss tax on the first $100,000.

Look, I work with people who are very unskilled, perhaps a little "slow", one step out of living in a homeless shelter. They have no dependents other than themselves, own nothing, earn minimum wage, and aren't eligible for all those government programs for the single moms and their kids.

15% of a 40-hr-wk minimum wage job is over $2,200/yr. That money would make a huge difference -- we are talking about guys who wear 3 sweatshirts because they can't afford a winter coat. Who wear two of them inside their tiny little run down apartments because they can't afford much heat. Who trudge around doing outside work in the snow in broken down ill-fitting shoes with holes in them because that was the best they could find at the Goodwill.

I hear a lot of this "poor people are parasites who don't pay any taxes" crap, and I'm sorry you should be ashamed to be making it. These are guys who work incredibly hard for very little, and you are arguing to quite literally take food out of their mouths.

Class warfare is wrong when it is conducted against the rich, but the rich can at least defend themselves. Class warfare by the rich against poor people is not even shameful, it's delusional. You really think you can talk slick enough to convince the vast majority of people, decent people, to impose confiscatory taxes on the desperately poor?!?

[Ignatz]

--I hear a lot of this "poor people are parasites who don't pay any taxes" crap, and I'm sorry you should be ashamed to be making it.--

I might be if I'd ever made it in my life, which I haven't, just as I've never made the argument or even the implication that all taxes are either progressive or flat.
You're normally very reasonable, so I have no idea why you're jumping all over me in a fairly personal way for the simple observation that those who pay FICA taxes receive a benefit those who pay only cap gains taxes don't and therefore the comparison is flawed.

[sbw]

cathyf, I've read your comment twice and still haven't mastered it, but you appear to have created an unnecessary strawman.

Everyone should be invested in the economy and efficiency of government. To me, that means that everyone -- rich or poor -- should have some skin in the game. That is not the case now. Please don't translate that into poor people are parasites because that miss-states the message.

[Ralph L]

15% is not chicken feed
If they have a kid (or claim one), they can get it back and more with EITC. We single men are screwed, as you say. I have a lot of capital (less since Wachovia collapsed) and no debts, but not much income, so the Bush tax cuts have been good to me (I pay more state tax than Federal).

As I said on another thread, I don't know why young people aren't marching in the streets about SS and Medicare.

[T J Sawyer]

Tom, I played this game several months ago to no avail. I concluded that there was only one way she could "pay tax" at that rate.

a) The "analysts" did their work by looking at W-2 data. It is readily available for calculation purposes - it just doesn't represent taxes paid.

b) The secretary has opted for extra withholding because of her husband's high income.

[boris]

"the idea that I will ever see a penny in social security benefits is delusional"

The government would not willingly give up the revenue stream ... which would happen instantly if benefits were dropped or cut drastically. Far better for them to just add more debt to cover a temporary lump.

So the debt goes up and real savings take a big part of the hit from inflation and everybody with income pays more taxes. See ... n o o o o o p r o b l e m o

[cathyf]

...the simple observation that those who pay FICA taxes receive a benefit those who pay only cap gains taxes don't and therefore the comparison is flawed.

That's not a simple uncontroversial observation at all. All of the FICA taxes that I have ever paid (and that anyone has ever paid) have gone into the general revenues. Where those dollars have been spent on every government expenditure from military salaries to buildings in WV named after Robert Byrd. Every dollar that I will EVER pay into FICA has already been spent -- my FICA dollars in the future will go to pay off Treasury Bond holders. I was born in 1963. You are delusional if you think that the US will get through NINETEEN years of baby boom retirees and still be paying out any benefits at all to any retirees who are not desperately poor.

If something can't continue, it won't.

Therefore, the notion that my FICA taxes have been or will be in any way related to benefits that I will receive when I am retired is simply delusional. Whether you call it FICA or self-employment tax, it is not in any way shape or form different for ME from capital gains tax or income tax or anything else you want to call any tax. And it's not different for ANYONE under 50, and probably not for anyone under more like 60.

To me, that means that everyone -- rich or poor -- should have some skin in the game. That is not the case now.

And this is PRECISELY what I am calling bullshit on. Everyone who works pays over 15% of their earnings into federal taxes. Everyone who has capital gains pays at least 15% of their capital gains into federal taxes -- even people whose gains are "tax-free" government bonds (because they give up the money to the government on the front end as reduced yields, and market forces ensure that the amount of money is the same.) The "skin in the game" argument is simply absurd -- somebody like the disabled person with no assets and no income other than SS disability has WAY more to lose if the government's checks start bouncing than the rich person who at least gets to keep some of the money he earns.

Poor people have been and will be FAR more harmed by the US's progressing fiscal train wreck than richer people.

[boris]

"All of the FICA taxes that I have ever paid (and that anyone has ever paid) have gone into the general revenues"

The same is true of treasury investments. The reasons they won't default are different but similar to the reasons SS won't either.

It's a bad system and should be replaced but a crash of the general economy is a more imminent threat and more likely to take down SS than the other way 'round.

[Ignatz]

--All of the FICA taxes that I have ever paid (and that anyone has ever paid) have gone into the general revenues.--

Do you actually believe that?
The vast majority of FICA taxes have gone directly to SS recipients. The SS surplus has been borrowed and dumped into general revenues.
And as Rick has repeatedly pointed out SS can be saved relatively easily by a combination of adjusting the increases and retirement ages.
Now I happen to think SS is unconstitutional and a very bad pension plan to boot that ought to be abolished. But can't we stick to actual facts and realistic projections? It's bad enough without having to exaggerate how bad it is.

[Ignatz]

Where your FICA taxes go;
85% directly to Social Security the remaining 15% to Medicare.
Since SS is now running a primary deficit and accumulating little or nothing in the trust fund, essentially no current FICA taxes go to general revenue.

[cathyf]

"85% directly to Social Security the remaining 15% to Medicare."

But those dollars don't go to my social security or my medicare. They go to a bunch of rich geezers living the high life because throughout their entire lives they paid way way WAY less in taxes than they spent on themselves in federal expenditures, since they have spent my every penny of my "retirement savings" that came into the Treasury plus another $15 trillion above that.

In other words, IT'S A TAX.

FICA has always been a humongous transfer of wealth from poor young people to rich old people. And just as I am finally getting old, the gravy train is running out of gas.

And yes, we are still collecting 15% of every dollar earned by every struggling young poor person and giving lots of it to rich old people. When those young folks get old, we will still be collecting a large chunk of every dollar earned by even the poorest working person, but it won't be going to the rich old people of the future. It will still be going to today's rich old people, who will be dead, but we will still be paying off the debts that they ran up living the high life.

[Ignatz]

--They go to a bunch of rich geezers living the high life because throughout their entire lives they paid way way WAY less in taxes than they spent on themselves in federal expenditures, since they have spent my every penny of my "retirement savings" that came into the Treasury plus another $15 trillion above that.--

First you said it went to the general fund, but now it's going to rich geezers. As you know the vast, vast majority goes to the middle class not the rich because the middle class are the vast majority.

--In other words, IT'S A TAX.--

Who are you arguing with? Who said it wasn't?

--FICA has always been a humongous transfer of wealth from poor young people to rich old people. And just as I am finally getting old, the gravy train is running out of gas.--

If they do nothing it's good for another 25 years. I don't know how old you are but if you're 60 that gets you to 85 and of course there is no chance nothing will be done.

Everything you say is an excellent argument for what a crappy system it is, and you have ample to reason to be ticked off at what a crappy system it is, but it has almost nothing to do with what anyone else, including me, is saying in this thread.
If that's my fault for not making my points very clearly, you have my apologies.

[cathyf]

No, Iggy, my apologies. I just get pretty frustrated by the notion that poor people don't pay any taxes, and have no stake in the system, and want fascist government, and are the enemies of the Tea Party, just because the taxes that they pay are mostly in box 4 and 6 rather than box 2.

Poor people are often pretty savvy about the fact that they are going to be really hurt by recessions and government financial crises, and see rich people as someone to impress and maybe they'll get a job. As opposed to the rich occupoopers who think that those icky rich people (you know, their parents) are just so greedy and evil and nasty.

It's the class warfare grievance pimps who are pitching that the rich are the enemies of the poor -- not us, we are the land of opportunity prosperity for all folks. But when the people on OUR side start claiming that poor people don't pay any taxes and so they want big government they are not making the America City on a Hill argument. They are making exactly the same class warfare argument as Billy Ayers and Jesse Jackson.

[qrstuv]

They're not the enemy of the Tea Party, CathyF, but it's often an uphill battle to convince them to give up perceived security in favor of independence.

[cathyf]

Yeah, but telling the working poor that they need to pay more taxes isn't exactly going to help make the battle any easier. Nor is telling the folks who are spending their savings to bail out their unemployed family members that those folks need to pay more taxes.

[MarkD]

So Buffett is un-doing his estate planning so that the Federal Government gets its fair share?

I didn't think so. Mr Buffett has already made his fortune. He's just making sure the rest of us will never reach his lofty level. I exclude any future Senator Kerrys who will presumably continue to marry theirs.