[EDITORIAL] IRS shows we're all at the mercy of feds' incompetence

As the financial crisis wreaked havoc on America's economy in October 2008, billionaire investor Warren Buffett made a wise observation about Fannie Mae and Freddie Mac — the two institutions at the center of the crash — and the regulatory agency that oversaw them at that time.

"It's really an incredible case study in regulation," Buffett said. "[T]he sole job of OFHEO was to watch over Fannie and Freddie. ... Two companies were all they had to regulate. OFHEO has over 200 employees now. They have a budget now that's $65 million a year, and all they have to do is look at two companies."

Of course, the catastrophic failure of the two tightly-regulated, government-sponsored enterprises is now the stuff of financial legend. Buffett's point stands as a nice antidote to the myth that tight government control can prevent most anything from going wrong. And as Fannie and Freddie were government enterprises, it also shows how government not only fails to prevent catastrophe, but often creates it or makes it possible.

On Tuesday, the Internal Revenue Service announced that about 100,000 taxpayers had had their personal data stolen from one of the agency's systems. As the Washington Examiner's Sarah Westwood reportedWednesday, this theft comes after years of warnings from the Treasury Department's inspector general about identity theft, which already costs the agency more than $5 billion each year, and which the agency remains incapable of preventing. No one expects the Internal Revenue Service — the supposedly wise guardian of millions of Americans' most private financial data — to be a leaky sieve for identity thieves to exploit. But it is.

Historically, fraudsters have exploited the tax-filing process by claiming the tax refunds of others. The IRS, ever quick to pounce taxpayers for innocent errors, is notoriously slow in dealing with such situations once they have been identified — according to the Government Accountability Office, it can take up to nine months in resolving them. And as the inspector general noted in 2012, the agency has no idea how many identity thieves exploit their processes to make bank.

Via: Washington Examiner

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WARREN BUFFETT EXPLAINS HOW A $15 MINIMUM WAGE WOULD HURT WORKERS

As Fortune observes, Warren Buffett is one of the Left’s favorite billionaires, but he occasionally says things they don’t want to hear. At such times, liberals politely ignore him and wait for him to say something useful to their cause, at which point the fulsome praise resumes.

They prefer not to dwell on such hypocrisies as the energy Buffett devotes to lawfully avoiding the high taxes he philosophically supports, which is no surprise, because hypocrisy is the grease that keeps the gears of socialism turning. Aristocratic privilege is the enticement leftists have always offered to useful industrialists.

The Left isn’t going to like what Buffett had to say about the minimum wage in the Wall Street Journal last week. After reviewing the numbers for income inequality (growing, especially during the Obama years, although Buffett tactfully avoids pointing that out) and poverty (static, despite trillions of dollars spent in the War on Poverty), he blows a hole through liberal class-war boilerplate about the rich somehow getting richer off the backs of the poor:

No conspiracy lies behind this depressing fact: The poor are most definitely not poor because the rich are rich. Nor are the rich undeserving. Most of them have contributed brilliant innovations or managerial expertise to America’s well-being. We all live far better because of Henry Ford, Steve Jobs, Sam Walton and the like.

Buffett explains at length that specialization is both the source of our incredible national wealth, and the difficulty some people – and, more disturbingly, some families - encounter when trying to access it. In a pre-industrial age when most of the population could perform most of the available jobs, and failure to perform generally resulted in starvation, there wasn’t much “income inequality” until the wealthiest aristocrats and hereditary royalty were considered. Sociologists regard the evolution of an independent middle class as an important achievement, but it inevitably creates a larger, more distinct underclass as well. “Poverty” was not as compelling a subject when just about everyone was equally poor… and commoners had few opportunities to significantly improve their station.

Via: Breitbart

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Sen. Udall Urges for Billions More in Wind Subsidies

Sen. Mark Udall is pleading for an extension for billions in subsidies to prop up the wind industry, a fight to protect tax credits utilized by Warren Buffett and one of the Colorado Democrat’s top donors.

The Production Tax Credit (PTC), a corporate tax credit that provides 2.3 cents per kilowatt hour of energy generated by wind farms, expired at the beginning of 2014. Now, Udall and his fellow Coloradan senator Michael Bennett (D.) are asking for a 10-year extension of the program.

Udall was “extremely disappointed” when a bill that would have provided nearly $13 billion for wind energy stalled in the Senate last week, arguing that the subsidies support jobs in Colorado. Udall and Bennett told Denver’s 9NEWSthat the PTC is necessary for Vestas American Wind Technology, which operates four wind farms in the state.

Warren Buffett, who has invested billions into wind farms, said recently that the industry is not viable without government assistance.

“I will do anything that is basically covered by the law to reduce Berkshire’s tax rate,” he said earlier this month. “For example, on wind energy, we get a tax credit if we build a lot of wind farms. That’s the only reason to build them. They don’t make sense without the tax credit.”

Buffett donated $2,300 to Udall’s campaign in 2008.

Wind energy production declines significantly absent the subsidy, as seen when it last expired in 2013. According to the Independence Institute, a free market think tank based in Colorado, total available wind energy output decreased 92 percent that year.

Via: WFB

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WHY CHRISTIE’S PERSONA WILL PLAY WELL IN THE REST OF AMERICA

Forget the acceptance speech. If you want an example of New Jersey Gov. Chris Christie’s imposing political IQ, watch the nine-minute impromptu speech he delivered in Sea Bright a few days before the election. The impeccable populist instincts that make Christie such a formidable politician were all in play — authenticity, empathy, combativeness.

It’s the latter that is the most widely discussed aspect of Christie’s political persona. It involves the gruff New York-area politico with the disposition of a Teamster. This is a guy who will look you in the eyes when he calls you on your BS. It’s the guy who reacts to Warren Buffett’s pleas for higher tax rates by saying, “Yeah, well, he should just write a check and shut up.” It’s the guy who tells a pestering liberal law student that he’s an “idiot.” (“I mean, damn, man, I’m governor. Could you shut up for a minute?”) The guy who calls a former White House doctor, the one who suggested that he lose weight, a “hack” and, yes, tells her to just “shut up.”

Christie wants a lot of people to shut up. The right people, usually.

Will the bluntness work on the national stage? That’s the question a lot of people are asking. When he runs for president, will the average Minnesotan or Coloradan find this character refreshing? Boorish? Exotic?

Growing up in the NYC area, I am certainly familiar with the Christie type. And those with a similar upbringing will also recognize the cadence, the mannerisms and demeanor. Christie is the counter guy at the local deli who acts as if he’s doing you a favor — “Hey, guy, what do you need?” He’s busy. He’s got important things to do — or at least a lot more important than whatever you’re whining about. Attack is his default position when challenged.

Via: Human Events

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Warren Buffett: Scrap Obamacare and Start Over

You know things are bad for President Obama when even Warren Buffett has soured on Obamacare and says that "we need something else." Money Morning writes:

"Healthcare costs in the United States are like a tapeworm eating at our economic body.

"Those words come from famed investor Warren Buffett, who said he would scrap Obamacare and start all over.

"'We have a health system that, in terms of costs, is really out of control,' he added. 'And if you take this line and you project what has been happening into the future, we will get less and less competitive. So we need something else.'

"Buffett insists that without changes to Obamacare average citizens will suffer.

"'What we have now is untenable over time,' said Buffett, an early supporter of President Obama. 'That kind of a cost compared to the rest of the world is really like a tapeworm eating, you know, at our economic body.'

"Buffett does not believe that providing insurance for everyone is the first step to take in correcting our nation's healthcare system.

"'Attack the costs first, and then worry about expanding coverage,' he said. 'I would much rather see another plan that really attacks costs. And I think that's what the American public wants to see. I mean, the American public is not behind this bill.'"

Via: Weekly Standard

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CONGRESSMAN: OBAMA'S TAX INCREASES FUND GOVERNMENT FOR EIGHT DAYS

President Barack Obama has proposed raising taxes on the rich to put America's fiscal house in order, but critics say federal spending is so massive that the wealthy don't have enough money to cover the nation's unprecedented debt.

In an interview with MSNBC's Andrea Mitchell, Rep. Tom Price (R-GA) said President Barack Obama's plan to raise taxes on the wealthy would only generate enough revenue to fund the federal government for eight days.

"The president’s plan to increase taxes on the upper two percent covers the spending by this federal government not for eight years, not for eight months, not for eight weeks but for eight days. Eight days only," said Mr. Price. "It’s not a real solution. So, again, I’m puzzled by an administration that seems to be more interested in raising tax rates than in gaining economic vitality."

The problem is that the rich don't have enough money to put so much as a dent in America's $16 trillion national debt. "If the IRS grabbed 100 percent of income over $1 million, the take would be just $616 billion," writes John Stossel. "That’s only a third of this year’s deficit. Our national debt would continue to explode."

Still, Mr. Obama's supporters persist in proposing tax hikes on the wealthy. On Sunday, billionaire Warren Buffett proposed a minimum tax for America's top earners. "We need Congress, right now, to enact a minimum tax on high incomes. I would suggest 30 percent of taxable income between $1 million and $10 million, and 35 percent on amounts above that."

There's just one problem with such an approach, says 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.

Indeed, even Mr. Buffett seems to concede that he and the president's "soak the rich" proposals are more an act of political theater designed to generate an emotional response than serious solutions: Mr. Buffett told Matt Lauer he believes his proposal would boost the "morale of the middle class." 

Via: Breitbart

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Obama Campaign Borrows $15M from Bank of America

Warren Buffett invested $5B in BofA last year

Obama For America took out a $15 million loan from Bank of America last month, according to the campaign’s October monthly FEC report. The loan was incurred on September 4 and is due November 14, eight days after the election. OFA received an interest rate of 2.5% plus the current Libor rate.

Warren Buffett, Obama donor and namesake of the infamous “Buffett Rule,” invested $5 billion in Bank of America last year in an effort to help the ailing financial institution. Last month, two weeks after OFA took out the loan, Bank of America announced a plan that would lay off 16,000 workers by the end of the year.

Obama has a complicated relationship with Bank of America. The bank contributed $20 million toward the cost of the Democrat National Convention earlier this year. Bank of America stadium, home to the Carolina Panthers, was supposed to host Obama’s acceptance speech. At the last moment, the campaign switched to a significantly smaller venue. The campaign claimed that an impending storm would not allow the President to deliver his address. Many questioned whether move was made because the campaign was having trouble filling such a large stadium.

It is unclear why the first $1 billion campaign needed an extra $15 million for the final two months of the campaign.

Via: WFB

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