Warren Buffett's call for higher tax rates on the nation's wealthiest taxpayers got a high profile spotlight last night on NBC Nightly News, which aired a Tom Brokaw piece featuring a sit down interview with Buffett. (See the clip and read the transcript in the previous Warren Buffett Watch post: NBC's Tom Brokaw Puts Spotlight ...)
He described his informal tax-rate survey of the people working in his office, which shows he pays a smaller percentage of his income in taxes than does his secretary, or anyone else in the Omaha home office for that matter. (He also described it during his fundraiser for Hillary Clinton earlier this year. WBW post from last June: Tax the Rich!)
Joe took the opportunity to challenge Buffett's views, getting into a quasi-debate with Brokaw, who took pains to say things like, "Buffett thinks .." or "Buffett would say ..."
The web site NewsBusters, which describes itself as "Exposing and Combating Liberal Bias," has a post by Brent Baker today detailing its argument that Buffett's informal office survey doesn't "match real tax data for the overall population -- even after tacking on the FICA (payroll) tax." Baker writes: "Unexplored by NBC, how the wealthier pay a much higher income tax rate than those making less and pay a far greater share of income taxes collected than they represent as a percent of all income."
This clip shows the entire Squawk Box segment, including the Kernen-Brokaw discussion after the interview excerpt. I've also included a transcript of the Buffett interview on tax rates.
Tom: Are you surprised there's not more talk in this presidential campaign about economic fairness and economic justice?
Warren: Yeah. I-- I-- I am surprised-- it may be that everybody wants to be cautious-- while they're looking to get nominated, but-- but the degree to which the-- economic-- well, the taxation system has tilted toward the rich and away from the middle class in the last ten years is-- is dramatic, and I don't think it's appreciated. And I think it should be addressed.
Tom: You've gone very public with this.
Tom: You've talked about in your office, for example, you pay a much lower tax rate with all of your wealth than, say, a receptionist does.
Warren: That's exactly right, Tom. And I-- I think the only way to do it is with specifics, and-- and add-- and in our office, 15 people cooperated in a survey out of 18. I didn't make anybody do it. And my total taxes paid-- payroll taxes plus income tax-- and the payroll tax is an income tax. It's based on income.
Warren: Mine came to-- 17.7 percent. That-- that was the-- that was line 61 I think-- or, no, line 43-- is the percent of taxable income, plus the payroll taxes, 17.7 percent. The average for the office was 32.9 percent. There wasn't anybody in the office from the receptionist on that paid as low a tax rate. And I have no tax planning. I don't have an-- I don't have a-- an accountant. I don't have tax shelters. I just follow what the U.S. Congress tells me to do.