Tax Life Insurance and Manufactured Homes

Glenn Reynolds (aka Instapundit) asks for reader suggestions on specific tax proposals that would hit Warren Buffett personally. Rather than rely on email, I'll post my suggestion here - tax life insurance from every direction and put a natural disaster tax on new manufactured homes. Warren Buffett's companies make a ton of money from selling life insurance. One of the reasons the wealthy buy life insurance is because life insurance proceeds can be exempt from income tax and estate tax, when structured and owned properly. As pointed out here, Buffett's companies make a fortune from the estate tax and repealing the estate tax would do away with a lot of Buffett's wealth. But since we'll likely never see the end of the estate tax (because guys like Buffett keep lobbying for it), this may be a good way to hit Mr. Buffett where it hurts.

Life insurance is still important for middle class families and many of them buy a large amount of it. Accordingly, I would propose that all income from life insurance proceeds in excess of fifty times median household income, as adjusted for inflation. This would exempt approximately $2.5 million in proceeds which would provide more than enough insurance for all but the richest of households. Anything above that threshold arising from the death of any individual would be taxed as ordinary income. Additionally, any insurance proceeds arising from the death of any individual shall be included in that person's gross estate for estate tax purposes regardless of whether the beneficiary of the proceeds is a person, trust or other entity other than a charity. This disincentive to buy life insurance would likely have a big impact on Buffett's cash cow business.

But maybe that's too complicated. If so, how about a natural disaster tax on all manufactured homes? It seems that these homes often do not fair very well during some types of natural disasters. Buffett's company owns Clayton Homes and I believe it also owns a company that finances manufactured homes.

Do these clowns really want to play the class warfare game?

The circle of despair

The automobile company bailout is but one example of the circle of despair that taxpayers are caught up in. Today, the CEO of GM is saying that higher gas prices would be "good for the environment." Let's see how this works:

1. Incompetent car company is failing because not enough people want to buy its product.
2. Incompetent car company's union helps current regime get elected.
3. In order to pay back the union for its support, current regime bails out incompetent car company. [Enter the taxpayers into the circle of DESPAIR].
4. Incompetent car company bets the taxpayers' "investment" on an unproven hybrid car.
5. King Barry works to do everything he can to make sure gas prices stay high. [taxpayers/drivers continue in the circle of despair].
6. High gas prices cause more people to buy hybrids.
7. Gas prices start to drop and less people become interested in hybrids.
8. Have CEO of incompetent car company suggest higher gas taxes so that gas prices will go back up.
9. TO COME: King Barry and the CEO get their higher gas taxes [taxpayers continue in despair]
10. TO COME: Higher gas prices lead to higher inflation - union goons get raises [taxpayers continue in despair]
11. TO COME: Union goons continue to support King Barry Obama and work to get him re-coronated. [taxpayers continue in circle of despair].

The higher gas prices are coming. If you think you're grabbing your ankles now, you ain't seen nothing yet.

Taxing the Rich

I love this from John Stossel:

As I've said before, a tax cut is not a handout. It simply means government
steals less. What progressives want to do is take money from some -- by force --
and spend it on others. It sounds less noble when plainly stated.

As they say, read the whole thing.

Negative Tax Liability

For the unitiated, "negative tax liability" refers to individuals who receive a "refund" even though they owe no tax. In other words, it is welfare by another name. The Enterprise Blog has an interesting graph that shows this and the dramatic increase in the number of people who pay no tax or get welfare in the form of a "tax" refund. (via Instapundit).

If the red light cameras don't find you, the GPS tracker will

There are some in the government that would love to replace the gas tax with a per-mile tax. They would use GPS to accomplish this, by tracking every move you make and every mile you drive. If the environment were truly a concern of these people, they would realize that a gas tax more heavily penalizes those who use more fuel and encourages conservation. Of course, the environmental rhetoric really has little to do with the environment and has everything to do with controlling the lives of the subjects.

Tax Hikes for the Middle Class

Obama won't rule it out, even though he already ruled it out. It's almost like he has forgotten that the Internet exists and that people no longer completely depend on the MSM for their information.

Upper East Tennessee Tea Party

I would love to go to the Tea Party on April 15 in Kingsport. Problem is, some of us have to work to get by on the fifty cents on the dollar that we are able to keep once all the looters get their share.