Warren Buffett Takes On Bush On Nightline Tonight

When Warren Buffett speaks, people listen. When Buffett takes
on the President of the United States, it gets your attention. And when
Buffett is willing to give an interview about it, you know there's
something he wants to get off his chest. Tonight, the CEO of Berkshire
Hathaway in a rare conversation with Ted Koppel.

House and Senate Republicans
have tentatively agreed on a framework for a $383 billion tax and spending
package. But Senate moderates whose votes are crucial to passing it are
not completely embracing it. Neither is Warren Buffett, arguably the most
influential investor in the land. In a signed newspaper opinion piece,
Buffett calls elements of the Senate tax cut plan "Enron-style
accounting."

What worries Buffett in looking at the Senate plan (under which the
dividends an individual receives would be 50 percent tax free in 2003, 100
percent tax free in 2004-2006, and then fully taxable again by 2007) is
how it would "futher tilt the tax scales toward the rich." And Buffett
knows a thing or two about the rich, since he's rated the second richest
person in the world by Forbes magazine with a net worth of $30 billion.
(He's runner-up to Microsoft Chairman Bill Gates.)

In response, the White House, and many Republicans who support the tax cut
plan, would say that the proposed cuts on dividends would help stimulate
the economy. But Buffett's answer back is, "If I get a break, someone
else pays. Government can't deliver a free lunch to the country as a
whole." He worries that the proposal promotes class warfare.

Meanwhile Soros, another billionaire, weighs in on this tax stupidity -- "I think that is really not a very effective way of using a deficit. I think we do need right now both a stimulative monetary policy and a temporary deficit, not a permanent one."

Buffett presented a scenario under which Berkshire Hathaway issues 1.0 billion dollars in dividends next year.

"Owning 31 percent of Berkshire, I would receive 310 million dollars in additional income, owe not another dime in federal tax and see my tax rate plunge to three percent," he wrote.

"And our receptionist? She'd still be paying about 30 percent, which means she would be contributing about 10 times the proportion of her income that I would to such government pursuits as fighting terrorism, waging wars and supporting the elderly," he said.