Monday, August 15, 2011

I Love You, Warren Buffett; Omaha, NE Fixture Tells Off Our "Billionaire-Friendly Congress"

Many of my readers know that Omaha, Nebraska was one of my favorite (if not my absolute favorite) US Route 6 towns.  I documented some of the best attractions in this blog post when I visited in June.  Impressed by the midwestern sensibility and aura of civic pride and generosity ( Sarah Joslyn and Charles Durham among others endowed millions to create museums for public enjoyment, and Father Flannigan established a haven for at-risk kids called Boys Town), I fell in love with Omaha.

Joslyn Art Museum
Omaha, NE
Today, I turned to the Op-Ed section of my daily paper, The New York Times, and was reminded all over again why I felt such affection for that Nebraska city.  Omaha's poster child, down-to-earth billionaire Warren Buffett wrote a politely scathing letter to our government; telling Congress to back off the poor and middle-class and tax the Super Rich more.  As a member of that rare super-rich fraternity, Buffett has the authority to finger-wag:

Back in the 1980s and 1990s, tax rates for the rich were far higher, and my percentage rate was in the middle of the pack. According to a theory I sometimes hear, I should have thrown a fit and refused to invest because of the elevated tax rates on capital gains and dividends.

I didn’t refuse, nor did others. I have worked with investors for 60 years and I have yet to see anyone — not even when capital gains rates were 39.9 percent in 1976-77 — shy away from a sensible investment because of the tax rate on the potential gain. People invest to make money, and potential taxes have never scared them off. And to those who argue that higher rates hurt job creation, I would note that a net of nearly 40 million jobs were added between 1980 and 2000. You know what’s happened since then: lower tax rates and far lower job creation.

Buffett goes on to recommend that tax rates be raised on taxable income in excess of $1 million and even more on $10 million plus. He himself is in that category.

This advice might raise the hackles of some folks in my hometown of Greenwich, CT; Hedge Fund Alley, where wildly out-of-whack incomes yield plenty of Lear Jets, personal helicopters and fourth and fifth homes but not many Public Art Museums.

Replica of Ernest Buffett's Grocery Store
Durham Museum - Omaha, NE

But it seems that Omaha has a history of the wealthy giving back to the community - and Warren E. Buffett, of modest origins (go to the Durham museum to see a mock-up of his father's grocery store) is just the latest rich man there to recognize his blessings and bounty (yes, from hard work, but also from luck) and a duty to return the favor. 

Warren, you are my hero!

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