Buffett favors an estate tax, but like virtually all billionaires, he won’t be paying it

BECKY FAST: You said earlier that this is not a tax reform bill. This is a tax deduction.

WARREN BUFFET: Tax deduction.

BECKY FAST: What do you think about this?

WARREN BUFFET: I — I don’t think I need a tax deduction.

But for example, the current proposal eliminates the property tax. And it’s not a death tax. 2.6 million people will die in the United States this year. And people – tax-paying properties – will have 5,000 tax returns.

So if you start going to a funeral every month, it will take an average of 40 years to go to a funeral for which property taxes are due. This is a very derogatory term.

The fact is, if they pass the bill they’re talking about, I’ll be able to leave $75 billion to a bunch of kids and grandchildren and great-grandchildren, and if they’re left to 35, they’ll each have a few billion dollars. They can increase it to 5 percent, they can have 100 million.

So this is a great way to allocate resources in the United States? Because that’s what you’re doing from a tax code perspective, you’re influencing the allocation of resources.

So if they were lucky enough to come out of the right womb, if they had the right name, Buffett, they could sit there and build tombs for themselves like the Egyptians that the pharaohs never dreamed of.

They could, they could, they could do anything. And — and capitalism is all about the wise allocation of resources.

Now some people say: “You don’t have to worry about that because they will ruin everything.”

But if (LAUGHS) they screw it up, that means they’ve – you know, done some stuff with some significant resources. And that’s not good for capitalism. I don’t think this is good for kids. I definitely don’t think having tons of inequality to begin with is a good thing for society.

And – so I – I would – for example, I think it’s a terrible mistake.

BECKY FAST: But — let’s play devil’s advocate here.

WARREN BUFFET: Certainly.

BECKY FAST: You have three children, each of whom has foundations they run. Do you think they allocate this money better than the federal government?

WARREN BUFFET: I – I do. But I – I – I don’t think it’s right to set it up as children, grandchildren – let’s say I died when they were 20. I don’t think they will be the same people they are. I didn’t promote this foundation program until they were in their 40s and I saw what they did with their lives and they had a chance to live a long time, they went to public schools, they lived just like other people in Omaha.

But I – I just think that – I don’t think we should allow our Olympic team 20 years from now to be the oldest sons on the Olympic team right now. And –

BECKY FAST: So this dynasty —

WARREN BUFFET: Dynasty —

BECKY FAST: —the influence of money.

WARREN BUFFET: I don’t think there is a dynastic system with a huge amount of wealth, I don’t think so, and keep in mind that the rich are much richer now than they were 25 years ago. We’re talking about the 400 currently having 2.4 trillion versus 90 billion; That is 25 times more money.

So – you have these children and grandchildren – sprinkled around – there may be two of these 400 alone – 2.4 trillion transferred to them.

That’s a lot of resources in this country with a $20 billion G – not even 20 bills – a trillion dollar G – GDP.

I think this is completely contrary to what built this country, what this country stands for.

And if these 5,000 people can’t bear to spend 20 or 25 billion, they have a lot left over. Believe me.

And incidentally it would be bad for charity. I mean – people – a certain number of people would choose to give their children billions and billions of dollars instead of going to philanthropy.

But I don’t think that’s the real reason. But I think it will be a spin-off.