Skip to main content

Sign up for our newsletter.

Quality journalism. Progressive values. Direct to your inbox.

"So a single financial firm received a one-year tax windfall that's more than the federal government allocates to its largest student aid program (Pell Grants) for the entire nation," observed journalist David Sirota. (Photo: Fortune Live Media/Flickr/cc)

With System So Rigged, Warren Buffett's Company Rakes in $29 Billion It Didn't Earn (or Want)

"To put that enormous windfall in perspective, $29 billion is roughly 2.5 times the entire annual budget for the Centers for Disease Control."

Jake Johnson

Adding to the mountains upon mountains of evidence that the American economy is thoroughly rigged in favor of the wealthy, Berkshire Hathaway CEO Warren Buffett told investors in a letter (pdf) over the weekend that his company saw a $29 billion boost in net worth that it didn't even earn—all thanks to the GOP tax cuts Buffett fervently lobbied against and said he didn't want.

"So a single financial firm received a one-year tax windfall that's more than the federal government allocates to its largest student aid program (Pell Grants) for the entire nation."
—David Sirota

"Berkshire's gain in net worth during 2017 was $65.3 billion," Buffett observed. "A large portion of our gain did not come from anything we accomplished at Berkshire...only $36 billion came from Berkshire's operations. The remaining $29 billion was delivered to us in December when Congress rewrote the U.S. tax code."

In response to Buffett's letter—which further demonstrated that, in the U.S., the wealthy get wealthier by default while pay for most Americans remains stagnant, even as they work longer hours—commentators pointed out the fact that $29 billion is equal to or more than what the U.S. spends on crucial social programs and government agencies.

Highlighting the fact that Berkshire's net worth boost came because its "deferred tax liabilities now pay off at the 21 percent instead of the 35 percent rate," journalist David Dayen notes that $29 billion is "the equivalent of what the U.S. spends on Section 8 vouchers in a year."

But while the Republican tax plan is certainly making the economy even more rigged, the earnings of the wealthiest Americans in 2017—and, for that matter, every year since the 1960s—show that the balance was heavily tilted in their favor long before the GOP bill was even conceived. Buffett himself famously admitted that "there's been class warfare going on for the last 20 years, and my class has won."

"U.S. wealth increased by $8.5 trillion in 2017, with the richest 2 percent getting about $1.15 trillion, which is more than the total cost of Medicaid (federal AND state) and the complete safety net, both mandatory and discretionary, including the low-income programs that make up the social support package derisively referred to as 'welfare,'" notes author Paul Buchheit in a piece for Common Dreams on Monday.

"How was their money made? Almost entirely by passively waiting for the stock market to go up," Buchheit writes. "American inequality is extreme, shameful, perverse, and growing....Yet by some unfathomable measure of ignorance or malice, Republicans cheer on the millionaire-making stock market while telling the most vulnerable Americans that they're spending too much on food."


Our work is licensed under Creative Commons (CC BY-NC-ND 3.0). Feel free to republish and share widely.

We've had enough. The 1% own and operate the corporate media. They are doing everything they can to defend the status quo, squash dissent and protect the wealthy and the powerful. The Common Dreams media model is different. We cover the news that matters to the 99%. Our mission? To inform. To inspire. To ignite change for the common good. How? Nonprofit. Independent. Reader-supported. Free to read. Free to republish. Free to share. With no advertising. No paywalls. No selling of your data. Thousands of small donations fund our newsroom and allow us to continue publishing. Can you chip in? We can't do it without you. Thank you.

Senate Barely Approves Scaled Back Legislation on Climate, Taxes, Health care

But thanks to Senator Kyrsten Sinema (D-AZ), there was a huge, last-minute win for the private equity and hedge fund industries

Common Dreams staff ·


'What the Hell is Wrong With Them': GOP Senators Kill $35 Cap on Insulin

'Republicans told millions of Americans who use insulin to go to hell.'

Common Dreams staff ·


World Faces 'Loaded Gun' on Hiroshima's 77th Anniversary

“We must ask: What have we learned from the mushroom cloud that swelled above this city?”

Common Dreams staff ·


'Extremely Concerned': Shelling of Europe's Biggest Nuclear Power Plant More Worrying Than Chernobyl

Ukraine said parts of the facility were "seriously damaged" by Russian military strikes.

Common Dreams staff ·


'Backsliding on Democracy': Indiana Governor Signs Extreme Abortion Ban Bill

'The extremist lawmakers who forced this bill through a special session clearly could not care less about what their constituents want or need.'

Common Dreams staff ·

Common Dreams Logo