Tuesday, 16 August 2011

Why Warren Biuffet's Advice Is Good for the Rich Too.

On Sunday friend and neighbor Adrienne Jones handed on this link to a Salon.com article on why it is in the interest of the rich to be taxed more. Basically, the idea is that in societies where inequality is high, the rich don't have it proportionallly better. In fact, they may live in fear, wrote Glenn Greenwald: "If you've visited some rich areas in Latin America, particularly when times generally are bad, marksmen on the roofs of houses are a norm. Living in fear of your physical safety is not a pretty existence.

"Japan, which made a conscious decision to impose the costs of its post bubble hangover on all members of society to preserve stability, has gotten through its lost two decades with remarkable grace. "

Then the next day Warren Buffet asserts in The New York Times that he thinks governments should stop "coddling" the super-rich. "I would leave rates for 99.7 percent of taxpayers unchanged and continue the current 2-percentage-point reduction in the employee contribution to the payroll tax. This cut helps the poor and the middle class, who need every break they can get.

"But for those making more than $1 million — there were 236,883 such households in 2009 — I would raise rates immediately on taxable income in excess of $1 million, including, of course, dividends and capital gains. And for those who make $10 million or more — there were 8,274 in 2009 — I would suggest an additional increase in rate."

The amount of money involved is beyond my comprehension: $1 million a year!

1 comment:

lagatta à montréal said...

Indeed. To Latin America one can add South Africa - despite the many forms of progress evident in that country including an increasing number of educated Black people with good jobs - the deep inequality that remains is a factor in anyone with even a modicum of assets having to remain behind high, barbed-wire covered walls and drive everywhere, in a country with a practically ideal climate for walkable cities. This includes not only the wealthy, but ONG staffers I know there (who are of a variety of racial and cultural backgrounds). To a lesser extent, even in the US many suburbanites fear the "inner city" to a degree unknown here.

In northern European countries such as the Scandinavian ones and the Netherlands, high taxes, and good social services, as well as a culture that looks down on ostentation even among the rich, mean a better quality of life for all, though these societies remain far from perfect and are under attack from the pressures of globalisation.