Monday, June 26, 2006
My New Hero -- Warren Buffett
I have never liked Microsoft. I never use any of their products I can avoid -- the near equivalent of escaping death and taxes. I think that, like Wal-Mart, they compete relentlessly and ruthlessly, never mind the dead carcasses left in the wake. I don't shop at Wal-Mart. But I have always liked Bill Gates. That he is giving away his immense fortune to fight disease on a global scale and to improve education adds another feather to his cap (star in the crown for religious types).
Now I learn that he and Melinda give Warren Buffett the credit for inspiring them to give back to society. So the hero of the day is the Oracle of Omaha -- the investor genius now worth about 44 billion. He now proposes to give about 37 billion of that away to charitable foundations with 5/6th of it going to the Bill and Melinda Gates Foundation and the rest to a number of family foundations.
Also, he supports the estate tax. He opposed the Bush tax cuts. He thinks a few hundred thousand is enough to leave to his children. He says that is sufficient to enable them to do anything they want but not enough so they can do nothing. He never gives his children more than the non-taxable limit of $10,000 a year, which he does every Christmas.
When asked what he would do if he could change the tax code, he said, "If I really could do it, it would shock you. I'd tax the hell out of personal consumption at progressively higher rates and impose an enormous inheritance tax."
Joining him in favoring the estate tax are William Gates, Sr. (father of Bill), George Soros, and Paul Newman. Paul Newman was once asked why he gave all the profits from his food-making industry to charity, he said, "Why not, I don't need it." Damn, it is hard to hate rich people like that.
Let us not forget the Mouth of the South -- Ted Turner. One day he realized he was a billion dollars richer than he had been the year before and decided to give that billion to the United Nations. It was, he said, his mission to convince other wealthy people to give similar sums to good causes.
Not all who are superrich are favorable to the estate tax. Oprah Winfrey does plan to give her fortune away, but she hates the estate tax, lamenting, "It's irritating that once I die, 55 percent of my money goes to the U.S. government. You know why that's irritating? Because you would have already paid nearly 50 percent (USA Today, June 9, 2000). Double taxation, they say. Never mind, as critics point out, that the bulk of large estates are in capital gains which have never been taxed. Moreover, those who want to abolish the estate tax conveniently forget that the creation of wealth is a social process not solely an individual achievement. Bill Gates is a genius and deserves a reward for his creative work, but does he deserve 50 or a 100 billion or whatever he finally ends up with? All of us who value the computer and buy Microsoft products, like the Windows XP on my machine making it go, have a part in making him rich. Microsoft would not have been possible without all the preceding science and technology which made it possible. Where would the Waltons be without all the customers who shop at Wal-Mart or without computers?
And what about the Waltons? Widow Helen and the four children of Sam, founder of Wal-Mart, have about 16-18 billion each, for a total of about 80-90 billion -- by far the largest family fortune around. They get richer all the time by sums now approaching a billion dollars a year. And where does their money go? They give to numerous charities like The Salvation Army and United Way. But their main activities are to oppose public education and to support charter schools and vouchers. Some observers say their ultimate aim is the privatization of all education, opening up money-making enterprises from which they could benefit. They also support right-wing foundations and causes. They spend enormous sums to elect conservative candidates to office. They have joined with the Gallos (wine) and the Mars (candy, I may have to give up Snickers) families and others in support of repeal of the estate tax, spending generously for the purpose.
So today let us cheer the Gateses, the Buffetts, the Turners, the Newmans, and the Soroses, and their tribe while we boo the Waltons.