Warren Buffett Stinks up the Billionaires’ Garden Party

Aug 27 2011 Published by under Uncategorized

Billionaire investor Warren Buffett has been preaching higher taxes for the extraordinarily well-to-do for more than a decade, but his August 15th Wall Street Journal op-ed was apparently the last straw for some of his pampered fellows in the velvet pantaloon club. Buffett had the temerity to remind us once again that despite his extraordinary wealth and income, he pays a lower percentage of his income in taxes than ordinary working class Americans. He asked Congress to finally stop “coddling billionaires” and make them pay their fair share, a vulgar indiscretion prompting a fusillade of grunting protests from the ivory towers of Koch Industries to the grimy corridors of the right wing blogosphere.

Perhaps Buffett felt his status as an incontestably successful capitalist hero might insulate him in some way and grant him the leeway to make such scandalously true statements. As only Nixon could go to China, perhaps Buffett feels only he can broach the topic of simple fairness without being branded a communist. If the past is any indication, Buffett simply didn’t give a damn and merely gave us a piece of his mind.

Victor Hugo observed that “an invasion of armies can be resisted, but not an idea whose time has come.” Undaunted by the long odds, Heritage Foundation blogger and sycophant to the mighty Lachlan Markay has thrown down the gauntlet. In a single preposterous post, Markay has managed to sum up with extravagant credulity the right’s utterly vacuous response to Buffett’s commonsense remarks. To the compelling man-bites-dog Buffett story, he responds with dog-licks-self stories, quoting both former American Express CEO Harvey Golub and right wing hero Charles Koch of Koch Industries in two utterly ineffective retorts to Buffett. Markay then weaves Golub and Koch’s pompous, self-absorbed burbling into his own trite and irrelevant tract on the virtues of the free market.

Harvey Golub is a pretty rich dude, rich enough that everyone with an ounce of self-preservation knows to call him “former American Express CEO Harvey Golub” instead of “former Chairman of the Board at the Campbell Soup Company Harvey Golub,” or heaven forbid, “former Chairman of the Board at AIG Harvey Golub.” These days, he sits on the executive committee of the right wing think tank the American Enterprise Institute, and though his tenure at American Express ended some ten years ago, Markay reverently flashes Golub’s AMEX Black Card before quoting from his unfathomably outlandish remarks published in the Wall Street Journal.

“Governments have an obligation to spend our tax money on programs that work,” says Golub in a transparent bid to seem reasonable, and then, “they fail at this fundamental task.” Really? Does our government really fail to spend money on programs that work? According to Golub, the answer is yes. All government spending amounts to waste, fraud, and meticulous abuse of the public trust. Nothing works. To prove his point, Golub then rattles off a series of loaded questions calculated to create the impression that our government exists only to squander our hard-earned money on one brazen boondoggle after another. “Do we really need dozens of retraining programs with no measure of performance or results?” he asks rhetorically. “Why do we spend billions on trains that no one will ride?” And so on. It’s hard to know where to begin in unraveling Golub’s farcical diatribe because each loaded question twists reality with a different false presupposition, but let’s look at one in detail:

“Why do we keep post offices open in places no one lives?”

Harvey, I hate to fart in your limo, but the short answer is “we don’t.” The Postal Service has proposed closing some 3,600 post offices in a draconian cost-cutting measure, but there isn’t a single one located in a “place where no one lives.” Even the smallest post office in the nation, a 56 square foot (no, that’s not a typo) former irrigation pipe shed situated at the edge of the Everglades in the tiny town of Ochopee, Florida serves eleven postal customers. At 12 by 20 feet, the North Hoosick post office in upstate New York is variously reported as the second- and third-smallest in the nation. The North Hoosick post office houses 124 P. O. boxes, 110 of which are in use by postal customers. Evidently someone lives there. Not any billionaires, mind you. Nobody important like Harvey Golub. Just a bunch of nobodies who can damn well drive an extra three miles on icy rural roads to a neighboring town’s post office to help shave a billionth of a percent off the Post Office’s budget, which incidentally will reduce federal spending by precisely zero dollars and zero cents.

After cataloging such imaginary extravagances, and anguishing about poor people who “pay no income taxes at all,” Golub has his John Galt moment, challenging Congress thus: “Before you ‘ask’ for more tax money from me and others, raise the $2.2 trillion you already collect each year more fairly and spend it more wisely. Then you’ll need less of my money.” Voila! Raise taxes on the poor and end all waste, so Golub can take it with him. After all, it’s a matter of fairness, right? Convinced? Didn’t think so.

Markay then calls his next witness, the execrable Charles Koch, who dazzles with his own fabulously absurd testimony:

“Much of what the government spends money on does more harm than good; this is particularly true over the past several years with the massive uncontrolled increase in government spending. I believe my business and non-profit investments are much more beneficial to societal well-being than sending more money to Washington.”

Huh? A point-by-point rebuttal hardly seems necessary here, although Daily Kos blogger Hunter certainly tears into it with gusto. Markay also keeps his spirits high despite the sheer volume of lunacy and lies Koch has packed into such a short passage, marshaling his limited reasoning abilities for a final spectacularly irrational assault on Warren Buffett.

“Both these billionaires [Golub and Koch] are saying essentially the same thing: I can spend my money better – more efficiently and effectively – than Washington can spend my money. These are two of the most successful businessmen in the country. President Obama has never owned or operated a private business. His Treasury Secretary has never even worked in one.”

What exactly is Markay really saying here? That the super-wealthy ought to enjoy a lower effective tax rate than ordinary working Americans simply because they’re more successful? That the success of businessmen in creating profits should somehow grant them the right to opt out of the inherently unprofitable business of funding government services? That the President and Treasury Secretary’s comparative lack of business acumen in some way justifies tax breaks for the super-rich? Markay seems not to sense the need for clarification, apparently satisfied that his patchwork of non sequiturs will pass for hardheaded realism at the Heritage Foundation.

Rather, he shifts to parroting the timeworn right wing maxim that “the budget cannot be balanced with tax hikes alone.” Whether this is true is debatable, but one entirely incontrovertible fact renders the statement irrelevant nevertheless: Buffett never said that the budget could be balanced with tax hikes alone. In fact, he says precisely the opposite: “Job one for the 12 [members of the deficit “super-congress”] is to pare down some future promises that even a rich America can’t fulfill. Big money must be saved here. The 12 should then turn to the issue of revenues.” More to the point, Buffett’s chief argument is that the rich should pay their fair share simply because it’s fair, not because it would play a role in reducing the deficit, although clearly it would.

But never mind all that. Markay quickly turns to an unabashed ad hominem attack on Warren Buffett himself. In short, “Buffett stands to personally profit from liberal economic policies,” he says, offering some tortured reasoning to make his case that Buffett has an ulterior motive in calling for higher taxes for the super-rich. Of what relevance is this? How does this contradict the fact that the super-rich pay a lower effective tax rate that ordinary working Americans? How does this address the fundamental unfairness of the current state of affairs? It doesn’t.

Lachlan Markay is certainly not alone in attacking Warren Buffett’s eminently sensible op-ed piece. Forbes Magazine has hosted at least a dozen similarly unconvincing pieces by nearly as many writers, calling Buffett “guilt-ridden” and “wildly misguided” among other things. But not one of these pieces directly addresses Warren Buffett’s central argument: that the super-wealthy get off easy compared to ordinary working Americans, and that fairness demands a more equitable distribution of the tax burden we share.

At long last, it may very well be an idea whose time has come.

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