Here's the latest knee jerk reaction to Warren Buffett calling for fairness in the income tax laws: Report: Buffett's Berkshire Owes $1 Billion In Back Taxes.
In my humble opinion, there's never been be a more blatant example of using a false equivalency to spin a story that you know your base will glom onto and shout from the roof tops regardless of it's validity. The GOP leadership and their spin meisters know it and count on it and cater to it. Here's fodder for Monday morning at the water cooler if you dare to point out the difference.
Mini MBA lesson below the fold...
The New York Post's and NewsMax's latest attempt to inflame their rabble to pitchfork and plowshare reaction to Warren Buffett's call for income tax fairness couldn't be more apples to oranges and a blatant "hair on fire" lie.
Obvious question: If Buffett really thinks he and his 'mega-rich friends' should pay higher taxes, why doesn’t his firm fork over what it already owes under current rates?” the Post opined.
The first obvious (maybe only to me) answer is that there is a HUGE distinction between Buffett's personal income tax debt and that of Berkshire Hathaway. One is the tax obligation of a private citizen and the other is that of a corporation owned by shareholders. Two completely different and separate entities under the law. (I love it when I can use sentence fragments correctly!)
That brings us to the second and less obvious distinction for most:
As Wilson points out, Buffett advocates for paying more taxes, but when it comes to his own company’s taxes, he has gone through great lengths to pay less. That’s rich."
Of course he has! Berkshire Hathaway's fiduciary responsibility to it's SHAREHOLDERS is to MAXIMIZE returns under current tax law. That doesn't mean that current tax law is fair or that Warren Buffett is a hypocrite for calling to make tax law more equitable. It only means that he's fullfilling his moral and business obligation to his shareholders.
And Warren's good at it too:
Wilson also points to a prior tax fight the company fought. “Apparently, this is not the first time that Berkshire Hathaway has tangled with the IRS. They fought a 14-year battle over the dividends received deduction. That case was just resolved in 2005,” Wilson reports..
“Although the prior case was settled in Buffett’s favor, it demonstrates a decades-long pattern of behavior by Buffett to minimize his taxes. That’s the important part of the story,” Wilson writes.
What it demonstrates is a decades-long pattern of shrewd business dealings and fighting for his shareholders WITHIN the limits of the law. That's why Berkshire Hathaway's share price is $104,000.00 per share.
Bottom line is that Warren Buffett's personal income tax obligation is a completely different animal from Berkshire Hathaway's and minimizing costs in the interest of shareholders is just plain old good business practice. But trust me, the distinction is already lost within the ranks of the woefully and willfully ignorant GOP base. They DON'T WANT to know the difference.
Here's hoping the water cooler doesn't boil over...