While Trump Touted $1,000 Bonuses to Workers, Buffet’s Company Got a $29 Billion Bonus from the Tax Cuts

By Sahid Fawaz

 

Berkshire Hathaway’s annual letters are legendary and often quoted for their insight.

This year’s letter begins with three paragraphs that are chilling to anyone who has been waiting to see what happens with the Republican tax plan:

“Berkshire’s gain in net worth during 2017 was $65.3 billion, which increased the per-share book value of both our Class A and Class B stock by 23%. Over the last 53 years (that is, since present management took over), per-share book value has grown from $19 to $211,750, a rate of 19.1% compounded annually.

The format of that opening paragraph has been standard for 30 years. But 2017 was far from standard: A large portion of our gain did not come from anything we accomplished at Berkshire.

The $65 billion gain is nonetheless real – rest assured of that. But 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.”

For the minority of workers that received a $1,000 bonus this year, they should seek comfort in the fact it will take them only 29 million years each to receive the same bonus as Berkshire Hathaway received this year (assuming the $1,000 bonus isn’t a one-time public relations stunt).

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