Warren Buffett Said 'We Were Promised a Rising Tide Would Lift All Boats'—But Instead, It 'Lifted All Yachts' And the Rich Got Richer

Warren Buffett is a billionaire known for his frugality—still living in the same modest house he bought in 1958 and famously avoiding luxury. But what's more surprising than his lack of a yacht is his willingness to call out the people who own them.

In a 2012 interview with Charlie Rose, Buffett didn't hold back on the growing wealth gap. "We were promised that a rising tide would lift all boats. A rising tide has lifted all yachts." His point? The economy may have grown, but the benefits didn't trickle down the way Americans were told they would. The ultra-wealthy got richer, while everyday workers were left treading water. And for Buffett, that's the real problem.

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"We have not had an ounce of shared sacrifice from the very rich," he added in that same interview. In other words, billionaires keep winning, while the system does little to level the playing field.

Buffett Isn't Letting This Go

If there's one thing Buffett is, it's consistent. In 2024, he was back at it, making the same argument he's been making for over a decade: the tax system favors the ultra-wealthy, and that needs to change. At Berkshire Hathaway's BRK BRK.B)) annual meeting, he pointed out that if 800 companies had paid their fair share, everyday Americans wouldn't owe a dime in federal taxes. His own company, he noted, paid over $5 billion at a 21% rate for 2023—and if Berkshire can do it, why can't others?

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Even Other Billionaires Are Taking Notice

In an August interview with PBS NewsHour, JPMorgan Chase JPM CEO Jamie Dimon weighed in on tax policy and the national debt, offering a surprising endorsement of higher taxes on the wealthy—specifically, the Buffett Rule.

"I would have a competitive national tax system, and then I would maximize growth," Dimon said, adding that some tax increases might be necessary. "You would maybe just raise taxes a little bit—like the Warren Buffett type of rule, I would do that."

The Buffett Rule, first proposed during the Obama administration, is based on a simple idea: anyone earning over $1 million a year should pay a minimum effective tax rate of 30%.

Not everyone is on board with the Buffett Rule. Some argue that high-income individuals already shoulder a substantial portion of federal income taxes. According to the Tax Policy Center, those making over $1 million pay an average effective tax rate of around 27% on their federal individual income taxes. Critics also point out that the Buffett Rule would impact less than a tenth of 1% of Americans and generate less than $5 billion a year, a figure they consider negligible against the backdrop of annual deficits projected to be much higher over the next decade.  

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A System Built for the Wealthy

Federal Reserve data shows about 93% of U.S. households' stock market wealth is held by the top 10%, with the richest 1% owning 54% of public equity markets—a record high. That means while corporate profits soar and markets hit all-time highs, the majority of Americans see little benefit.

It's a dynamic that benefits those at the top. Wealthy investors don't just own more stocks—they also enjoy tax advantages, stock buybacks, and lower capital gains rates, while middle-class workers are taxed more heavily on their wages.

The numbers have changed, but Buffett's argument hasn't. The top 1% continues to see their wealth grow at historic levels while middle-class workers deal with rising costs and a tax system that favors those who already have the most.

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