Donate to reduce the federal debt, you don’t need higher taxes to get the job done

What do the really wealthy do with their money? The short answer is they spend it. The full answer is that they pay their taxes, they invest, they spend and they give it away to foundations, charities, colleges and communities. Andrew Carnegie built 1600 libraries in his time. Bill Gates gave billions to his foundation to fight disease; Oprah built a school in Africa, etc. Some of their money creates new businesses and new jobs and more wealthy people. I would say for the most part the true millionaires and billionaires while reaping the rewards of their status are good for society. Even when they splurge on luxury homes and yachts and planes that the rest of us have trouble even imagining, they are sustaining jobs for many Americans who are in the supply chain to build those homes and yachts and planes.

What the wealthy (and nearly all other people) do not do is walk the talk when it comes to the federal debt. Some folks in the midst of the millionaires and billionaires are outspoken when it comes to raising taxes. Raise my taxes…please! However, if you are a billionaire and your taxes are raised does it really matter much, you already have more than you can spend. On the other hand, if you are upper middle-income and happen to marry another upper middle-income person and you each make $135,000 a year, it does matter if your taxes are raised as you have been lumped into the “wealthy” category along with Warren Buffett.

For those patriotic Americans who believe that government debt should be paid through higher taxes rather than lower spending, the Treasury Department has a special fund to allow them to fulfill their wish. The Bureau of the Public Debt (a bureau just to manage the public debt…interesting) will accept your check which you can specify to be used only for debt reduction. To date in 2011 they have received $1,684,906.37 and in 2010 they received a total of $2,840,466.75 which by the way equals about $7,048.30 per US billionaire. Com’on guys can’t you dig a little deeper?

If you are interested in giving, click here and you can see how.

I have my own theory why millionaires and billionaires are apparently quite reluctant to send a gift to the government to reduce the debt despite the well publicized rhetoric pushing for higher taxes on Americans who earn $250,000 or more a year ($250K by the way is what a person with $50 billion might earn on his investments in less than two hours (assume a 3% return).

If you are a billionaire, you are a smart person, a very smart person. Being a smart person you know that sending your money to the federal government is a very inefficient use of the money. They must feel that even though the money is to be dedicated to debt reduction, it may be wasted, diverted to other purposes, spent on new programs, etc. So these smart people while talking a good game of higher taxes on behalf of all Americans instead use their money wisely through their own foundations and targeted donations which is good for all of us. They put the money to good use and keep it out of the hands of politicians and bureaucrats. Hey, they really are smart people these millionaires and billionaires.

Now if we could only get some of them to shut up, we can go to the library or art museum and enjoy ourselves or we can spend our time writing letters to members of Congress to tell them to cut spending and get our house in order. Perhaps we should encourage the Treasury to invest in Greek bonds; they are paying a hefty return these days.

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