Obama, The Buffett Rule And Your Money: Be Afraid. Be Very Afraid.
I'm not sure what it is that Warren Buffett hopes to accomplish with his rabid support of Barack Obama and Obama's fascination with soaking the rich. If you confiscated the entire wealth of the top 100 of the Forbe's 400 wealthiest American's, Buffett included, you'd have something to the tune of $1.3 trillion. This would not put a dent in our nations' debt. It wouldn't even cover the deficit for 2012. Yet Buffett, once touted by both John McCain and Obama as a possible Treasury Secretary candidate, is openly supporting higher taxes on the wealthy. Sounds noble, doesn't it? It doesn't amount to a spit in the river and Warren Buffett knows it. He's crazy like a fox.
The budget deficits are confounding. What exactly is the deficit? It's the amount by which the government's total budget outlays exceeds its total receipts for a fiscal year. Basically, Uncle Sugar is putting out a helluva lot more than he's taking in. That's why I call him 'Uncle Sugar'-he's become everyone's new sugar daddy. Millions of American's take. Not nearly enough are giving back. And frankly, we cannot give enough at this point. According to radio talk host and author Mark Steyn:
"If you took every single penny that Warren Buffett has, it'd pay for 4-1/2 days of the US government. This tax-the-rich won't work. The problem here is the government is way bigger than even the capacity of the rich to sustain it. The Buffett Rule would raise $3.2 billion a year, and take 514 years just to pay off Obama's 2011 budget deficit."
So just what does Buffett think we're going to accomplish with more taxation? Buffett takes a whopping $100,000 annual salary from Berkshire-Hathaway, the company he's controlled since the 1960's. His massive wealth is well protected and invested. He knows the tax game and plays it well. Don't misunderstand; I do not fault Buffett for his wealth. I wish I had his insight. But his connection to Obama, a rabid social and fiscal far-left liberal teetering on the brink of Marxism and treading the waters of European-style socialism, raises more questions for me than answers. The philosophy and mechanics of capitalism run in complete contradiction to the path Obama seems determined to follow. I'd accuse Buffett of simply being an old man looking to somehow buy his way into heaven by expanding his social conscience, but he's reportedly an agnostic, so I doubt he considers his wealth much of a drag on his soul. But if I were a fellow billionaire, I'd certainly corner Buffett on the issue one on one. And I'm sure some of them have tried.
Raising taxes would bring in more revenue, but it's meaningless without deep cuts to spending. Obama cannot get on board with cuts to social programs without offending the very core of the Democratic party itself, the core that believes you and I owe them something. Democrats and Republicans alike will have to answer for plenty by the time the 2014 mid-term elections roll around. And liberals have to make sure Obama plays the cards well, to ensure that, at the very least, they don't lose Senate seats. But eventually, he must advocate for cuts. Where will they come from? Military will be the biggest. Defense Department budget cuts could easily approach $1 trillion over the next decade. Yet somehow, we're going to keep 10,000 plus troops in Afghanistan beyond 2014. What are we going to arm them with, slingshots? I've been a hawk on the war on terror. But over the past year, I've come to the conclusion that nothing short of a scorched earth policy can effectively put down the Taliban and terrorist dogs and we just don't have that in the battle plan. So let's bring our guys home and leave Afghanistan to rot. Billions off the books in a snap. And while we're at it, let's stop spending a dime on the United Nations. They are not worthy of even an ounce of our respect much less our hard earned money. Move their headquarters to Afghanistan. It's a more appropriate locale for them.
But don't be fooled. It is just mathematically impossible to ever pay off our national debt. It will not happen. The dollar worth is dependent on money supply; more dollars in circulation mean less value. Rapid deflation or inflation are destructive. And the dollar as the world standard is in very real danger. It has been for a long time. Lot's of blame can be assigned for our state of affairs and not all of it falls on Barack Hussein Obama. He's not that powerful. Not yet. But many talking heads on radio, television and print would have you believe that either Republican's or Democrats can somehow, someway, get us out of the hole. I don't think anyone, not even Warren Buffett, has a clue where to go with this. But one thing I do know, the key to beginning the climb out of a hole, is to first put down the shovel and stop digging.