WHATS THE REAL DEAL MR. BUFFETT?

Now that Warren Buffett has taken it upon himself to become a propagandist for increased taxes for the only moderately wealthy, let’s ask Warren Buffett a couple of indirect questions. He seems to advocate approximately the same tax rate should be applied to people making incremental income above $250,000 per year as those making $10 million a year and above. It’s a bit ridiculous.

Mr. Buffett proudly boasts about his company’s outstanding growth via its book value. I took a real quick look at three insurance companies for the last ten to fifteen years in Value Line; Chubb, Allstate and Berkshire. A perusal seemed to show that those randomly chosen insurance companies had their book value grow in the same manner as Berkshires. No great genius on Mr. Buffett’s part, just an industry trend?

For the sake of discussion, let’s assume Mr. Buffett has a couple of hundred million of his multibillions of net worth invested in municipal bonds. If he gets a tax free return of 2% on his few hundred million in the muni market he would make approximately $4 million dollars on the two hundred million he invested.

Think about it, Buffett would get $4 million dollars of tax free income on such a small percentage of his fortune and he thinks that people who earn a few hundred thousand dollars a year should get an increased tax bill.

I think I read that one of Buffett’s children works at Berkshire Hathaway. I also believe I have read that he has either already given or plans to give each of his children approximately $50 million dollars. When you have the kind of wealth that Buffett has, you can afford to pay the taxes and still leave your children extremely wealthy. People at the lower level of wealth don’t have an equivalent option.

If he wants to opinionate on other people taxes why doesn’t he just give away all of his money instead of putting it into Foundations and taking the tax deduction for doing so. He actually has the gall to say he doesn’t even have a tax accountant.

By the way, from what I can tell, three companies; American Express, Coca Cola and Wells Fargo represent over half of Buffett’s equity investments. Looking at the financial performance of Mr. Buffett’s operating companies as reported in the most recent, confusing, almost 100 page annual report; it appears as if Mr. Buffett’s management skills, in the current economic climate, were not any better than those of his peers.

Since he seems to be a spokesman and model for so many, a public figure rather than a private one, why doesn’t he make a financial disclosure about all of his tax avoidance methods including his foundations, one of which I believe is being run by one of his family members. We would all be enlightened and learn something.

From what I can tell Mr. Buffett has created a public campaign of promoting the so called “working man” so no one really has the incentive to take a good close look at his true intentions and actions in his own life, which seem to me to be to protect himself from close public scrutiny. Increased taxes, to practically the wealthiest man in the world, mean almost nothing, to ordinarily wealthy people, they mean a heck of a lot. He’s just plain wrong. Stay tuned…