RUSH: A couple of notes on taxes, ladies and gentlemen. In the New York Times today, there’s a story about Obama saying that he will raise taxes ‘on the top 1% of American earners,’ and he will use the money to pay for health care. We’ve heard this before over and over, from any Democrat. He didn’t suggest, however, that he would raise other taxes to pay for expanded services. He wants to roll back the Bush tax cuts in the top 1% of people who ‘don’t need it,’ he said. It’s none of your business, sir. It’s not the government’s job to assign ‘need’ to people. If people start accepting the fact that government can assign various incomes to certain people because ‘that’s all they need,’ and then go take whatever else is left, then we are in deep doo-doo. We’re going to have to fight this tax battle all over again. If these guys win the White House, folks, hold onto your back pockets because it’s not about raising money.
Yet, get this headline from Bloomberg: ‘Buffett Battles Bush as Corporate-Jet Owners Fight Tax Increase.’ Well, I wonder what this is about? Well, let’s read it and find out. ‘U.S. airlines, which already share the sky with corporate jets, are pushing to share their tax burden too. President George W. Bush is proposing to cut the amount passenger carriers such as American Airlines and Continental Airlines pay in federal taxes each year by $1.68 billion. Most of that obligation would be shifted to small-jet operators, including General Motors Corp., Exxon Mobil Corp. and NetJets Inc., the business-jet charter company,’ which Warren Buffett owns. NetJets is a fractional ownership plan. You give Warren Buffett X-number of dollars and you get so many hours on one of his airplanes every year. A lot of people do this fractional ownership business. Now, in the Bush plan, there’s no tax cutting. They’re just going to shift the burden. The way it works right now is, the government collects $2,015 in taxes every time a full Boeing 757 flies between New York and Florida. A Gulfstream IV, a GIV. — that’s what that is, for those of you watching on the Dittocam. My model back there is of a GIV-SP.
If you fly on a GIV along a similar route, the tax that the owner pays is $236. ‘Under Bush’s plan, the operators of the Boeing jet would pay $1,298, and owners of the Gulfstream would pay $837,’ up from $236. The reason for this is — and, by the way, the passengers are paying the tax. This business that the airlines are paying the tax, it’s built into the ticket price. One of the reasons or purposes of the tax is to help defray costs of the air traffic control system — and the airline said, ‘Wait, that’s not fair! We got all these corporate jets out there, and they’re using air traffic control every bit as much as we do, but they’re not paying nearly as much.’ They may have a point, to a certain extent, but the really don’t when it comes to passengers and they’re carrying far more passengers than private jets are. The number of airplanes, private vs. commercial in the air at any one time, I don’t really know the breakdown of this. But Warren Buffett, he owns a lot of them. Netjets owns beaucoup corporate jets, and he doesn’t want to pay that tax. Isn’t that fascinating? He doesn’t want to pay the tax increase — a tax increase on the rich! You have to say that it is, and he’s one of the rich guys. I just found this a little interesting.