happy tax day!

A few things to keep in mind as we watch people break out their tiny little violins to play on the blogs, talk radio, tv news, and at the local neighborhood bar all day long...

First, Federal Income Taxes on Middle-Income Families at Historically Low Levels

second... “There’s class warfare, all right,but it’s my class, the rich class, that’s making war, and we’re winning.” -- Warren Buffett

In Class Warfare, Guess Which Class Is Winning

Put simply, the rich pay a lot of taxes as a total percentage of taxes collected, but they don’t pay a lot of taxes as a percentage of what they can afford to pay, or as a percentage of what the government needs to close the deficit gap.

Mr. Buffett compiled a data sheet of the men and women who work in his office. He had each of them make a fraction; the numerator was how much they paid in federal income tax and in payroll taxes for Social Security and Medicare, and the denominator was their taxable income. The people in his office were mostly secretaries and clerks, though not all.

It turned out that Mr. Buffett, with immense income from dividends and capital gains, paid far, far less as a fraction of his income than the secretaries or the clerks or anyone else in his office. Further, in conversation it came up that Mr. Buffett doesn’t use any tax planning at all. He just pays as the Internal Revenue Code requires. “How can this be fair?” he asked of how little he pays relative to his employees. “How can this be right?”

Even though I agreed with him, I warned that whenever someone tried to raise the issue, he or she was accused of fomenting class warfare.

“There’s class warfare, all right,” Mr. Buffett said, “but it’s my class, the rich class, that’s making war, and we’re winning.”

And most important of all...

"Taxes are the price we pay for civilization." --  Oliver Wendell Holmes, Jr.

Posted via email from Jim Nichols