| Submit your comments on this article |
| Economy |
| Warren Buffett: Tax Hypocrite? |
| 2009-11-05 |
| When Warren Buffett criticized President Bush's tax cuts while plumping for the presidential campaigns of Barack Obama and Hillary Clinton, he garnered prominent, adulatory headlines ... Consider that as the context for two pieces of information: First, the observation, amid a column in today's Wall Street Journal, about Berkshire Hathaway's cash mountain: "Mr. Buffett would rather not resort to the simplest way of solving this problem -- paying excess cash out to shareholders in the form of a dividend. Since he owns roughly 26% of Berkshire's shares, a cash dividend would saddle Mr. Buffett with one of the largest personal-income tax bills in American history. That's not the kind of thing at which he likes to excel. Mr. Buffett's reluctance to pay a dividend leaves him with little choice but to buy big companies outright." Second, the news (again, from the Wall Street Journal) that Mr. Buffett's Berkshire Hathaway is joining in a bid to buy $3 billion in tax credits from Fannie Mae. Reports the Journal: "The credits are virtually worthless to Fannie Mae and require the company to take losses each quarter as their value declines. Companies such as Berkshire Hathaway and Goldman Sachs could use them to offset federal tax expenses." Neither Journal article places the news in the context of Mr. Buffett's stated support for higher taxes. |
| Posted by:tipper |