Warren Buffett stirred the political pot Monday by calling on Congress to quit "coddling" the mega-rich, but exactly how much weight the Omaha billionaire's voice will carry in Congress is questionable.
Republicans quickly scorned Buffett's call to raise taxes on the mega-rich, while others questioned whether Democrats had the political will to capitalize on Buffett's plan to ease the nation's debt woes.
"Warren Buffett is one of the most respected people in the United States, but it takes more than Warren Buffett. It takes political leaders to pick up on this," said Steffen Schmidt, political scientist at Iowa State University.
Buffett is on the radar of political pundits and elected leaders this week after he chastised Republicans in Congress for refusing to consider a tax hike on the wealthy during this summer's bitter budget battles. He also argued the rich have been making more and paying lower tax rates on those earnings since 1992.
"My friends and I have been coddled long enough by a billionaire-friendly Congress. It's time for our government to get serious about shared sacrifice," Buffett wrote in an op-ed piece in the New York Times.
Buffett urged members of a congressional deficit committee to help reduce the nation's debt by raising taxes on those with incomes above $1 million and even more for those making more than $10 million.
President Barack Obama quickly capitalized on the billionaire's comments, referring to them during a campaign stop in Minnesota on Monday. Obama said Buffett made a compelling argument that taxes needed to be raised to help close the budget gap, saying the "tax breaks" given to billionaires like Buffett are unfair.
Obama, on a three-state swing through the Midwest, also has called for a tax hike on higher-income Americans. But Obama would increase taxes on those who make more than $250,000.
Republicans heard Buffett. Several said there was nothing stopping the billionaire from donating millions to the nation's coffers.
"For tax-raising advocates like Warren Buffett, I am sure Treasury would take a voluntary payment for deficit reduction," wrote U.S. Sen. John Cornyn of Texas, the chairman of the National Republican Senatorial Committee.
The argument over taxes is one of the biggest issues that divide Republicans and Democrats as they tackle the nation's ballooning debt.
Republicans have refused to consider tax increases, calling for cuts alone to balance the nation's budget. Democrats counter that a more balanced approach is needed: cuts and tax hikes.
They also argue that if the rich are not required to shoulder some of the pain in the nation's budget crisis, poor- and middle-class taxpayers will bear the brunt of sacrifice through cuts to such federal programs as Medicare, Social Security and the federal college loan program.
Exactly what impact Buffett will have on the debate is debatable.
Schmidt said Buffett's views are likely to be greeted favorably by the public, but he doubted Democrats would pick up the torch. That's because many face re-election next year and don't want to be tagged with the pro-tax label, said Schmidt.
"Democrats are chicken. They think Americans would not support Democrats if they said, 'We're going to raise taxes,' " said Schmidt.
Others noted that Buffett's comments came as many Americans are tuning into the budget debate, and national polls show a majority favor higher taxes on the rich.
If the public embraces Buffett's views, his proposal could have a chance of becoming part of the deficit committee's debate, said John Hibbing, political scientist at the University of Nebraska-Lincoln.
"It is not dead on arrival. I think there is a real chance for this," he said. "This is one area of taxation the public supports."
A key issue is how a tax hike on the wealthy might affect the nation's economy. Many Republicans, including Rep. Lee Terry, have argued that a hike on the wealthy would result in fewer jobs being created. The argument goes that the rich would be less likely to invest in the economy if taxed more.
Buffett and others argue that that's untrue. He said he's never seen an investor shy away from a money-making idea because of a tax rate. He also noted that nearly 40 million jobs were created between 1980 and 2000, when tax rates were higher.
Several economists in Nebraska and Iowa said research on the impact of tax hikes on the wealthy have produced "mixed" results.
Much of the research indicates a "relatively small" impact on job creation and investment, said John Deskins, an economics professor at Creighton University.
"I find it hard to believe it would have no impact, but, at the same time, conservative Republicans who tell you it's going to be disastrous for the economy — that's not supported in research," said Deskins.
One thing economists do agree on is that raising taxes on the super-rich falls short of solving the nation's budget crisis.
Buffett's plan would increase the nation's revenue by only about $50 billion a year, Buffett told The World-Herald. Each year, the U.S. spends $1.3 trillion more than it collects in taxes.
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