Warren Buffett, chief executive officer of Berkshire Hathaway, waves to shareholders in November 2009, prior to the annual Berkshire Hathaway shareholders meeting in Omaha, Neb. In the past, Buffett has championed his pro-tax stance, saying his wealth should be taxed heavily to support the public institutions that allowed him to succeed.
Warren Buffett, chief executive officer of Berkshire Hathaway, waves to shareholders in November 2009, prior to the annual Berkshire Hathaway shareholders meeting in Omaha, Neb. In the past, Buffett has championed his pro-tax stance, saying his wealth should be taxed heavily to support the public institutions that allowed him to succeed. Nati Harnik/AP
Marnie Thompson defies the conventional wisdom that wealthy people don't like taxes.
She's on a public relations and lobbying campaign to see her own taxes go up.
"I'm proud to pay my taxes; it's a hallmark of democracy," says Thompson, the daughter of a wealthy businessman who gave $5 million she would have inherited to found a charity.
"As a wealthy person, I want you to tax me more," she writes to her elected officials.
And, more than likely, she'll get her wish.
Raising Taxes For The Wealthy
The series of tax cuts the Bush administration enacted in 2001 is set to expire at the end of the year. Income taxes for households with incomes over $250,000 (or $200,000 for single people) will go up, although Congress is expected to extend the cuts for those making less.
Dividend taxes, which had been cut to 15 percent, will very likely also increase, although it's not clear whether they will revert to the previous top rate of 39.5 percent. Likewise, estate taxes for the wealthiest Americans are also likely to increase. In addition, taxes to pay for the new health care legislation are likely to add to the tax bill.
If you ask Jeffrey Hollender, who along with Thompson is a member of the Responsible Wealth project, all of those cuts should go away because they primarily benefit the richest, like him.
"I do feel that I should pay more taxes — absolutely," Hollender says. "While I don't like how the government spends the money I give them, I do feel that I pay too little."
A man picks up federal tax Form 1040 at a post office in Palo Alto, Calif., last April. Some of the wealthiest people in the U.S. want to pay higher taxes to help reduce the deficit.
A man picks up federal tax Form 1040 at a post office in Palo Alto, Calif., last April. Some of the wealthiest people in the U.S. want to pay higher taxes to help reduce the deficit. Paul Sakuma/AP
Hollender, co-founder of the eco-products company Seventh Generation, says he doesn't believe in trickle-down economics — the theory that what benefits the rich helps everybody.
"These arguments are really about keeping money in the pockets of people who already have too much money," Hollender says.
It might seem strange and novel that some rich liberals like Thompson and Hollender would campaign against their own financial interests on taxes. Naturally, they could give away their money — and they both do some of that.
And they say their embrace of taxes isn't as weird as it might seem. There may be plenty of evidence to suggest otherwise. But these wealthy individuals point to a recent Quinnipiac University poll showing nearly two-thirds of those with household incomes of more than $250,000 a year support raising their own taxes to reduce the federal deficit.
In the past, other superrich people, including Warren Buffett and Bill Gates Sr. — father of the Microsoft founder — have championed their pro-tax stance. They said their wealth should be taxed heavily to support the public institutions they say allowed them to succeed.
Not everyone agrees this is a good move.
A Difference Of Opinion
"Obviously they're entitled to their own opinion and it's certainly refreshing that they would take an opinion that runs against their short-term personal interest, but that doesn't mean their position is necessarily right," says Alan Viard, a scholar for the American Enterprise Institute, a conservative think tank.
He says taxing the top 2 or 3 percent of earners won't raise nearly enough to patch the deficit. That would require tax increases over a broader swath of the population as well as spending cuts, Viard says.
Besides, Viard says, higher taxes for the rich may not be in the best interest of the public or the overall economy.
"I don't think it's going to be too big of a surprise if you see a reduction in saving and some reduction in investment" if the rich are hit with higher taxes, Viard says.
But Hollender says the country faces too many grave social and economic problems not to tap the resources of the rich. He doesn't enjoy parting with the money, he says, but better him than less well-off people.