It’s something we always knew was happening, ultra-rich Americans paying little to no taxes even as their wealth increases. ProPublica has obtained IRS data on the top 25 richest Americans and how they maneuver the tax system by claiming very little taxable income, borrowing money, or reporting investment losses all to offset paying taxes. Between 2014 and 2018, these top 25 saw their worth rise a collective $401 billion, but paid a true tax rate of just 3.4%. Jeff Ernsthausen, senior data reporter at ProPublica, joins us for how billionaires like Jeff Bezos, Elon Musk, Warren Buffet and others sometimes get away with paying nothing in taxes.
Next, plant-based meats were already having a moment before the pandemic showing up in your grocery stores, fast food chains, and restaurants, but as meat and pork prices were going up do to the pandemic, these alternative meats were surging in options and dropping in price. In 2020, we saw 112 new plant-based meat, egg, and dairy brands hit the shelves and people aren’t just trying them once, we are seeing repeat customers. Laura Riley, business of food reporter at The Washington Post, joins us for how plant-based proteins are taking a bite out of Big Meat.
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Episode Transcript
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Speaker 1 (00:00):
It's Thursday, June ten. I'm Oscar Ramirez in Los Angeles,
and this is the Daily Dive. It's something we always
knew was happening. Ultra rich Americans paying little to no
taxes even as their wealth increases. Pro Publica has obtained
high r S data on the top twenty five richest
(00:20):
Americans and how they maneuver the tax system by claiming
very little taxable income, borrowing money, or reporting investment losses
all to offset paying taxes. Between least top twenty five
saw their worth rise at collective four hundred and one
billion dollars, but paid a true tax rate of just
three point four percent. Jeff earnst Housen, senior data reporter
(00:45):
at pro Publica, joins us for how billionaires like Jeff Bezos,
Elon Musk, Warren Buffett, and others sometimes get away with
paying nothing in taxes. Next, plant based meats were already
having a moment before the pandemic, showing up in your
grow US three stores, past food chains and restaurants. But
his meat and pork prices were going up. These alternative
(01:05):
meats were surging in options and dropping in price. We
saw one and twelve new plant based meat, egg and
dairy brands hit store shelves, and people aren't just trying
them once. We're seeing repeat customers. Laura Riley, business, a
food reporter at The Washington Post, joins us for how
plant based proteins are taking a bite out of big meat.
(01:28):
It's news without the noise. Let's dive in. Racial study
shows the fifty five in the nation's biggest corporations paid
zero federal tax last year. Those fifty five corporations made
an excess of forty billion dollars in profits. Joining us
(01:50):
now was Jeff Ernsthausen, senior data reporter at Pro PUBLICA.
Thanks for joining us, Jeff, thanks for having me. I
wanted to talk about taxes. They're at pro public Uh,
you guys were able to obtain a large amount of
I r S information. It shows how billionaires like Jeff Bezos,
Elon Musk, Warren Buffett, a lot of others really pay
(02:10):
very little in income taxes compared to their massive wealth.
Sometimes they paid nothing. There's a number of cases, a
number of times where these individuals paid nothing in federal
income taxes. And uh, you know, we have this kind
of notion in America that everybody pays their fair share
and taxes, and all the stata that you guys obtained
really kind of throws that out the window. There's a
(02:32):
number of mechanisms and loopholes that these people can use
to avoid paying a lot of those taxes. So Jeff
walk us through some of this and some of the
information that you guys were able to obtain. Yeah, so
our first story is about a very basic concept in
some ways, UM, which is that you and I we
worked to live. We are in wages or salary. Taxes
(02:53):
are taken automatically out of our paychecks every month. The
ults are wealthy are not in the tax system in
the same way. So the of their wealth as it grows,
it's not tax until they choose to do something like
say self stock, so they can accrue vast wealth which
is really like the equivalent of income for us UM,
and not pay taxes on it. And so you mentioned
in some years billionaires have managed to pay nothing in
(03:16):
federal income tax. Jeff Bezos paid no income taxes twice
in two thousand, seven thousand eleven, Elon Musk paid nothing
in eighteen and in recent years, Dan Air investors George
Sorros and Carla Cohn, uh and Michael Bloomberg have all
paid nothing in income taxes in some years, and so
there's been a main finding that we were able to
produce UM is that if you kind of take the
(03:37):
entire group of the top twenty five, which is people
in America, and look at their wealth growth over a
five year period and look at how much they paid
in taxes, you get that they grew their wealth by
four hundred billion dollars over the five years from two thousand,
fourteen and eighteen and paid only a fraction of it
three four percent in federal taxes during that time. And
for comparison, you know, the average sort of typical American
(03:59):
who take some a wage pays about on their income
taxes in those years. Yeah, the disparity and all that
is huge, and you know, obviously the big question comes
how do they get to do that. One of the
couple of things that I see is a common theme obviously,
and you mentioned it right, the income. You have to
report income to be able to be taxed on it.
(04:19):
So a lot of times what these do is um.
You know, you report losses on investments, or you borrow
a lot of money. You don't have to pay income
taxes on that stuff because it's not technically income. That's right.
I mean, you know, a good example in terms of
you're not taking income would be someone like Warren Buffett.
You know, Berkshire halfway sort of famously doesn't pay dividends
(04:42):
and so the stock price grows, dividends aren't paid out.
So Warren Buffet's not registering you know, income for tax
purposes on it um, and so he has a very
low rate when you consider how much he's paid in
taxes um compared to how much is wealth grown in
recent years um, which is tensibility of dollars. Going back
to the other notion of you know, borrowing large sums
(05:04):
of money, we see a lot of these big companies
c e O s and everything. A lot of times
they're saying, hey, well, I'm only going to take a
one dollar in my salary for this year. And to
a lot of people he was hearing that saying, oh, well,
they're you know, they're not cashing in all sorts of
amounts of money. But you know, it just doesn't really
work out that way. They're not taking that incomes and
they're not paying the taxes on that stuff. But they
(05:25):
keep growing their wealth in other ways. That's exactly right.
And you know, like with other assets, you can borrow
against wealth, right, So in some sense, you know, folks
who are in the highest wealth threat UM, they can
borrow against things like shares of stock um, which several
of the folks in the top five did UH in
the past decade or two so UM. And you sometimes
(05:48):
see that come out actually in disclosures from the SEC.
And so from that we know that Elon Musk, for example,
borrowed tens of billions of dollars UM are pledged tens
of billion dollars of US with stock UH in order
to borrow money. So even though it may not look
like income, there's still a way to access that value.
And your findings in all of this, you guys were
(06:10):
able to tax it's a lot of I R S information,
kind of raw information, and you were comparing that to
other data that we have a data from Forbes about
how a lot of these people grew their wealth, and
you came up with a new number something that you
guys were calling a true tax rate. Basically, they're increasing
their wealth so much, but they only paid this amount
in taxes. And when you look at that number. I
(06:33):
mean that really kind of paints a picture of how
much they're actually paying compared to all the money that
they're making. Walk us through some of that, so we did.
We did. Two stories came out today. One um was
looking at this sort of traditional you know, rates that
the I R s might publish, you know, income or
taxes divided by income basically to get a your tax rate. Interestingly,
(06:55):
the ultra wealthy pay a relatively low rate as far
as that's concerned as hell, because most of their income
is in the form is in forms of income that
are taxed to lower rate, like capital games. But it's
not capturing the whole picture because you really have to
take a look at how much they're able to, you know,
really bring in and add to their buying power, to
(07:15):
their influence and society things like that that are influenced
by your wealth. And when you take that picture, when
you look at the sort of unrealized gains as well
as as traditional income, you see that it's a really
small fraction for for them as a group in terms
of what they pay in federal income taxes and for
some individuals it's incredibly small. Walk us through some of
those names, because you mentioned Jeff Bezos, Warren Buffet, Elon Musk,
(07:39):
give us a few numbers if you can with how
much they're really paying when you work it out this way. Yeah,
So you go back to two thousand and six, and
you look at how much Jeff Bezos, for instance, um,
how much his wealth has gone up. They went up
something on the order of, uh, you know, hundred and
thirty billion dollars um. And in that time, you paid uh,
(08:00):
you know one I think one point four billion in taxes,
And it sounds like a lot, but when you sort
of divide that by a hundred and thirty billion, it's
only about one percent um that he's paying on his
on his wealth growth um. So it can be a
strikingly low figure. It's actually even lower if you look
at a Warren Buffett who has a very who takes
(08:20):
a very low income. I wanted to work in, uh,
some of the discussion around taxes when it comes to
politics and all that, because we've been hearing that from
the Biden administration wanting to raise taxes on the wealthy,
on wealthier Americans, also on corporations that are making billions
of dollars um you know we've been hearing a lot
about that. How does that work into this conversation. Well,
(08:42):
for you know decades, the conversation about taxes has been
kind of dominated by marginal tax rates, right, Um, but
those rates are only going to capture what happens when
people do take income um. And so uh, you know,
some some folks who are at the top of a
wealth distribution, these these barely wealthy billionaires, um. You know,
(09:04):
they'll be affected to some degree by that, but it's
not going to change much of the picture when we
talk about how much the paying in taxes versus their
wealth growth. Some economists do you think that many economists
think that, Uh, the corporate taxes are ultimately paid by
by individual people, and if you distribute that, most of
that falls onto the shareholders. So insofar as there's moves
(09:26):
on the corporate tax rate, um, that would be more
likely to be sort of raising revenue, at least indirectly
off of this group. You made mention in the article
as well about taxes being paid after somebody passes away,
and how even then a lot of people's estates are
able to skirt paying a lot of the taxes and
and passing on that well to their errors and all
(09:48):
of that stuff. I mean, obviously there's all sorts of
loopholes all over the place, but that just kind of
figures into all of this even in depth. People escape
paying a lot of these taxes. Yeah, there's an entire
industry round wealth management, and a lot of that is
geared towards figure out how to sort of minimize tax burden, right,
and so there are complicated sort of trust that you
(10:10):
can set up if you are interested in trying to
move a portion of your estate without having it end
up being taxed at the estate tax level when you
when you pass on UM and a lot of these
UM you know, sorts of trusts are only accessible to
people on who are in you know, in the top
top stratum, which is also who's affected by the estate
(10:31):
tax of course. Jeff earns Housen, Senior data reporter at
pro PUBLICA, thank you very much for joining us, No,
thank you for having me. Those companies have scaled up,
have increased their production facilities, um are getting better deals
(10:56):
on the basic ingredients, just as grocery prices in every
other category has uh skyrocket. Joining us now was Laura Riley,
Business of Food reporter at the Washington Post. Thanks for
joining us, Laura, Oh, thanks for having me. I wanted
to talk about alt meat, alternative meat proteins right now.
They were having a moment before the pandemic, and throughout it,
(11:18):
nobody knew exactly what was going to happen, how things
were going to get affected. We saw a lot of
supply chain issues with a normal meat production, but these
all proteins really kind of stood out throughout the pandemic.
And one of the key things that helped them was
the price. The price was coming down just at the
right moment for them, as other traditional meat beef and pork,
(11:41):
their prices were going up. So Laura, tell us a
little bit about what we're seeing with these plant based
meats right now. Well, so, before the pandemic, you know,
you saw I p o s like the incredible Beyond Meat.
I mean, it really was incredible investment in the space
and celebrity investors and it was really kind of blowing up.
It was to me, en was all about kind of
(12:03):
alt protein, whether that was milk substitutes or you know,
vegan eggs, etcetera, etcetera. I mean, the playing field really
expanded in the pandemic hit and no one knew what
was going to happen. You know, what what was it
going to mean for this fairly fledgling category, you know,
was it a fad um or did it have legs?
(12:23):
And I think that that a lot of things have
conspired too solidify that it really is a trend or
a movement rather than just you know, something kind of fleeting.
One thing that happened was that meat prices, especially for
beef and for pork, have dramatically increased, you know, they
really in grocery prices overall have really exploded, but those
(12:47):
categories have exceeded or kind of outstripped all the other
grocery categories. And so now at the grocery store, people
are comparing uh, you know, impossible meat to ground beef
and saying, huh, yes, the impossible is still a little
bit more expensive, but not way more expensive. So before
the pandemic, it was clear that you know, people who
(13:11):
wanted to enjoy these new products, these kind of you know,
animal free products. We're paying a premium for him. And
so those companies have scaled up, have increased their production facilities,
um are getting better deals on the basic ingredients just
as grocery prices in every other category has uh skyrocketed.
(13:33):
Let's do a little bit of price comparison, because before
this you mentioned the article, A pound of ground impossible
burger was like double that of even the fanciest ground beef.
It was pretty expensive, and you know, for those people
coming into it wanting to try it, I mean, that
could be cost prohibited for them. But right now it's
almost equal in certain cases. Beyond has really come down
(13:56):
quite a bit, so it's kind of maybe a little
under six bucks in a lot of store, and that's
comparable to kind of premium ground beef. Just eggs, their
prices have come down so that they're kind of you know,
they're still expensive. They're about fifty cents and eggs, so
that's more expensive than the commodity eggs in the grocery store,
but it's about on par with the kind of premium
(14:17):
pasture raised eggs that you'll find at the farmer's market.
So they're starting to reach that price parody point, which
a lot of the industry analysts said we were still
way far away from. So you know, a year ago
when I was talking to analysts, they'd say, oh, Gosho
at the very earliest, probably later than that that you'd
start seeing kind of price equivalence. And we're seeing this
(14:37):
much sooner than anticipated. And in a lot of cases,
you know, for like Pat Brown, it impossible or for
some of these companies, their goal is to undercut traditional
animal egg prices. Um that is their objective, and they
want to eat eat the lunch of you know, traditional
animal egg. And you may mention the article to something
really important that they were getting repeat customers with this,
(14:59):
because obvio see there's people that maybe want to try
something once or twice, but if they're coming back, then
you know, that just means more for them. Absolutely no,
I think that that's a key factor for all of this,
you know, I think there were people who were curious
and maybe one timers. And and the interesting thing is
this is mostly these products are not really for vegans
or vegetarians, season especially the meat one, this new round
(15:20):
of of all meat. They're really more for the kind
of omnivore or the flexitarian who's trying to go a
little lighter on meat, either for health reasons or for
the environment, you know, kind of carbon sequestration reasons. Um.
So I think that we're seeing a larger number of
people who are willing to try, and then a larger
number of people who are willing to make it kind
of a regular part of their diet. While these alternative
(15:43):
proteins are kind of growing right now, it's really just
a fraction of what the traditional beef, poultry, and pork
game really is. And a lot of these big companies
are jumping into that game. They're expanding their product lines
to expand into these alternative proteins as well. I think
that's one of the most surprising things is that you're
seeing you know, Cargill and and JBS and Tyson and
(16:07):
Hormel are all these huge meat companies joining, you know,
and it does feel like and they're all realigning themselves.
What you know, they used to call themselves meat companies
and now they're proutin companies. So they're expanding what they
do because no one really knows how big this new
market is going to become, you know, and I think
that they're kind of if you can't beat them, join them.
(16:27):
You know, that mentality works in this case. If you
offer traditional chicken nuggets and then also you know, vegan nuggets,
well then you kind of got all your bases covered.
So and those big companies, especially when you start getting
into like Archer Daniels Midland or companies that that really
produced the building blocks, you know, kind of the ingredients
for some of these other companies. You know, you're driving
(16:50):
down price by these huge economies of scale. Um. So
the more of these traditional animal ad companies that get
into this game, the more price pressure is going to
be on the traditional side of things. You know, you
made mention obviously prices are going up. There are we
going to continue seeing that? You know, the country's opening
back up, getting more back to normal. Um. You know,
(17:10):
during the pandemic, we saw huge things happening, labor shortages,
supply chain issues, all that stuff. Is that trend continuing
or is that easing up yet? Well, we haven't seen it.
So in terms of kind of data that came out
in the past couple of weeks, prices have been have
continued to be very high, and have been high for
beef and pork. So I don't think there's any indication
(17:32):
that those things are coming down. We still have all
kinds of supply chain problems and and you know, it's
the whole world is so interconnected now that even things
like this the computer chip shortage um that has all
kinds of trickle down ramifications for other supply chain uh
you know issues. So you know, I think that we're
very likely to see high continued high prices, especially because
(17:54):
we have tons of people buying groceries as we've seen this,
you know, through the whole pandemic, and now re restaurant
in the country has had to restock its walk in
so we're having a lot of price drivers right now.
Are are all those restaurants getting back in the game
and trying to get back up to capacity restaurants? What
are we seeing with them? We're seeing a lot of
things from YELP Open table about people just making reservations constantly.
(18:18):
That part of it is is coming back. It's good
for those restaurants that have been suffering so long throughout
the pandemic, well they are roaring back. I talked to
a chef yesterday in Las Vegas who said they had
three thousand people in Las Vegas last weekend and that
every restaurant was a capacity. The problem with that is
that staffing is still a massive shortfall for for so
(18:40):
many restaurants, so You're getting this real disconnect between the
fervor and enthusiasm for all of us who are sick
of our own cooking, you know, for the year of
living at home, we all want to get back with it. Myself,
I would out to dinner last night. It felt great.
You know, that's what we want to be doing right now.
But most restaurants, almost all the restaurants I know, are
(19:01):
still looking for staff so that they can staff up.
You're seeing these weird situations where a restaurant will be
two thirds full with a line out the door, and
they're telling people they're turning people away, and people are saying, well,
ead I see an empty table, said, well, if you
don't have the servers to service those tables and you
don't have the kitchen staff to make the food, doesn't
matter how many physical tables are in the restaurant. Laura Riley,
(19:25):
business a food reporter at The Washington Post, Thank you
very much for joining us. Oh thanks for having me.
That's it for today. Join us on social media at
Daily Dive pod on, above, Twitter, and Instagram. Gave us
a comment, give us a rating, and tell us the
(19:46):
scores that your interest today allow us and I Heart
Radio or subscribe wherever you get your podcast. This episode
of The Daily Divers, produced if Right and engineered by
Tony Sargentina him Moscar Pramirez. In this it was your
Daily Dive.
It's Thursday, June ten. I'm Oscar Ramirez in Los Angeles,
and this is the Daily Dive. It's something we always
knew was happening. Ultra rich Americans paying little to no
taxes even as their wealth increases. Pro Publica has obtained
high r S data on the top twenty five richest
(00:20):
Americans and how they maneuver the tax system by claiming
very little taxable income, borrowing money, or reporting investment losses
all to offset paying taxes. Between least top twenty five
saw their worth rise at collective four hundred and one
billion dollars, but paid a true tax rate of just
three point four percent. Jeff earnst Housen, senior data reporter
(00:45):
at pro Publica, joins us for how billionaires like Jeff Bezos,
Elon Musk, Warren Buffett, and others sometimes get away with
paying nothing in taxes. Next, plant based meats were already
having a moment before the pandemic, showing up in your
grow US three stores, past food chains and restaurants. But
his meat and pork prices were going up. These alternative
(01:05):
meats were surging in options and dropping in price. We
saw one and twelve new plant based meat, egg and
dairy brands hit store shelves, and people aren't just trying
them once. We're seeing repeat customers. Laura Riley, business, a
food reporter at The Washington Post, joins us for how
plant based proteins are taking a bite out of big meat.
(01:28):
It's news without the noise. Let's dive in. Racial study
shows the fifty five in the nation's biggest corporations paid
zero federal tax last year. Those fifty five corporations made
an excess of forty billion dollars in profits. Joining us
(01:50):
now was Jeff Ernsthausen, senior data reporter at Pro PUBLICA.
Thanks for joining us, Jeff, thanks for having me. I
wanted to talk about taxes. They're at pro public Uh,
you guys were able to obtain a large amount of
I r S information. It shows how billionaires like Jeff Bezos,
Elon Musk, Warren Buffett, a lot of others really pay
(02:10):
very little in income taxes compared to their massive wealth.
Sometimes they paid nothing. There's a number of cases, a
number of times where these individuals paid nothing in federal
income taxes. And uh, you know, we have this kind
of notion in America that everybody pays their fair share
and taxes, and all the stata that you guys obtained
really kind of throws that out the window. There's a
(02:32):
number of mechanisms and loopholes that these people can use
to avoid paying a lot of those taxes. So Jeff
walk us through some of this and some of the
information that you guys were able to obtain. Yeah, so
our first story is about a very basic concept in
some ways, UM, which is that you and I we
worked to live. We are in wages or salary. Taxes
(02:53):
are taken automatically out of our paychecks every month. The
ults are wealthy are not in the tax system in
the same way. So the of their wealth as it grows,
it's not tax until they choose to do something like
say self stock, so they can accrue vast wealth which
is really like the equivalent of income for us UM,
and not pay taxes on it. And so you mentioned
in some years billionaires have managed to pay nothing in
(03:16):
federal income tax. Jeff Bezos paid no income taxes twice
in two thousand, seven thousand eleven, Elon Musk paid nothing
in eighteen and in recent years, Dan Air investors George
Sorros and Carla Cohn, uh and Michael Bloomberg have all
paid nothing in income taxes in some years, and so
there's been a main finding that we were able to
produce UM is that if you kind of take the
(03:37):
entire group of the top twenty five, which is people
in America, and look at their wealth growth over a
five year period and look at how much they paid
in taxes, you get that they grew their wealth by
four hundred billion dollars over the five years from two thousand,
fourteen and eighteen and paid only a fraction of it
three four percent in federal taxes during that time. And
for comparison, you know, the average sort of typical American
(03:59):
who take some a wage pays about on their income
taxes in those years. Yeah, the disparity and all that
is huge, and you know, obviously the big question comes
how do they get to do that. One of the
couple of things that I see is a common theme obviously,
and you mentioned it right, the income. You have to
report income to be able to be taxed on it.
(04:19):
So a lot of times what these do is um.
You know, you report losses on investments, or you borrow
a lot of money. You don't have to pay income
taxes on that stuff because it's not technically income. That's right.
I mean, you know, a good example in terms of
you're not taking income would be someone like Warren Buffett.
You know, Berkshire halfway sort of famously doesn't pay dividends
(04:42):
and so the stock price grows, dividends aren't paid out.
So Warren Buffet's not registering you know, income for tax
purposes on it um, and so he has a very
low rate when you consider how much he's paid in
taxes um compared to how much is wealth grown in
recent years um, which is tensibility of dollars. Going back
to the other notion of you know, borrowing large sums
(05:04):
of money, we see a lot of these big companies
c e O s and everything. A lot of times
they're saying, hey, well, I'm only going to take a
one dollar in my salary for this year. And to
a lot of people he was hearing that saying, oh, well,
they're you know, they're not cashing in all sorts of
amounts of money. But you know, it just doesn't really
work out that way. They're not taking that incomes and
they're not paying the taxes on that stuff. But they
(05:25):
keep growing their wealth in other ways. That's exactly right.
And you know, like with other assets, you can borrow
against wealth, right, So in some sense, you know, folks
who are in the highest wealth threat UM, they can
borrow against things like shares of stock um, which several
of the folks in the top five did UH in
the past decade or two so UM. And you sometimes
(05:48):
see that come out actually in disclosures from the SEC.
And so from that we know that Elon Musk, for example,
borrowed tens of billions of dollars UM are pledged tens
of billion dollars of US with stock UH in order
to borrow money. So even though it may not look
like income, there's still a way to access that value.
And your findings in all of this, you guys were
(06:10):
able to tax it's a lot of I R S information,
kind of raw information, and you were comparing that to
other data that we have a data from Forbes about
how a lot of these people grew their wealth, and
you came up with a new number something that you
guys were calling a true tax rate. Basically, they're increasing
their wealth so much, but they only paid this amount
in taxes. And when you look at that number. I
(06:33):
mean that really kind of paints a picture of how
much they're actually paying compared to all the money that
they're making. Walk us through some of that, so we did.
We did. Two stories came out today. One um was
looking at this sort of traditional you know, rates that
the I R s might publish, you know, income or
taxes divided by income basically to get a your tax rate. Interestingly,
(06:55):
the ultra wealthy pay a relatively low rate as far
as that's concerned as hell, because most of their income
is in the form is in forms of income that
are taxed to lower rate, like capital games. But it's
not capturing the whole picture because you really have to
take a look at how much they're able to, you know,
really bring in and add to their buying power, to
(07:15):
their influence and society things like that that are influenced
by your wealth. And when you take that picture, when
you look at the sort of unrealized gains as well
as as traditional income, you see that it's a really
small fraction for for them as a group in terms
of what they pay in federal income taxes and for
some individuals it's incredibly small. Walk us through some of
those names, because you mentioned Jeff Bezos, Warren Buffet, Elon Musk,
(07:39):
give us a few numbers if you can with how
much they're really paying when you work it out this way. Yeah,
So you go back to two thousand and six, and
you look at how much Jeff Bezos, for instance, um,
how much his wealth has gone up. They went up
something on the order of, uh, you know, hundred and
thirty billion dollars um. And in that time, you paid uh,
(08:00):
you know one I think one point four billion in taxes,
And it sounds like a lot, but when you sort
of divide that by a hundred and thirty billion, it's
only about one percent um that he's paying on his
on his wealth growth um. So it can be a
strikingly low figure. It's actually even lower if you look
at a Warren Buffett who has a very who takes
(08:20):
a very low income. I wanted to work in, uh,
some of the discussion around taxes when it comes to
politics and all that, because we've been hearing that from
the Biden administration wanting to raise taxes on the wealthy,
on wealthier Americans, also on corporations that are making billions
of dollars um you know we've been hearing a lot
about that. How does that work into this conversation. Well,
(08:42):
for you know decades, the conversation about taxes has been
kind of dominated by marginal tax rates, right, Um, but
those rates are only going to capture what happens when
people do take income um. And so uh, you know,
some some folks who are at the top of a
wealth distribution, these these barely wealthy billionaires, um. You know,
(09:04):
they'll be affected to some degree by that, but it's
not going to change much of the picture when we
talk about how much the paying in taxes versus their
wealth growth. Some economists do you think that many economists
think that, Uh, the corporate taxes are ultimately paid by
by individual people, and if you distribute that, most of
that falls onto the shareholders. So insofar as there's moves
(09:26):
on the corporate tax rate, um, that would be more
likely to be sort of raising revenue, at least indirectly
off of this group. You made mention in the article
as well about taxes being paid after somebody passes away,
and how even then a lot of people's estates are
able to skirt paying a lot of the taxes and
and passing on that well to their errors and all
(09:48):
of that stuff. I mean, obviously there's all sorts of
loopholes all over the place, but that just kind of
figures into all of this even in depth. People escape
paying a lot of these taxes. Yeah, there's an entire
industry round wealth management, and a lot of that is
geared towards figure out how to sort of minimize tax burden, right,
and so there are complicated sort of trust that you
(10:10):
can set up if you are interested in trying to
move a portion of your estate without having it end
up being taxed at the estate tax level when you
when you pass on UM and a lot of these
UM you know, sorts of trusts are only accessible to
people on who are in you know, in the top
top stratum, which is also who's affected by the estate
(10:31):
tax of course. Jeff earns Housen, Senior data reporter at
pro PUBLICA, thank you very much for joining us, No,
thank you for having me. Those companies have scaled up,
have increased their production facilities, um are getting better deals
(10:56):
on the basic ingredients, just as grocery prices in every
other category has uh skyrocket. Joining us now was Laura Riley,
Business of Food reporter at the Washington Post. Thanks for
joining us, Laura, Oh, thanks for having me. I wanted
to talk about alt meat, alternative meat proteins right now.
They were having a moment before the pandemic, and throughout it,
(11:18):
nobody knew exactly what was going to happen, how things
were going to get affected. We saw a lot of
supply chain issues with a normal meat production, but these
all proteins really kind of stood out throughout the pandemic.
And one of the key things that helped them was
the price. The price was coming down just at the
right moment for them, as other traditional meat beef and pork,
(11:41):
their prices were going up. So Laura, tell us a
little bit about what we're seeing with these plant based
meats right now. Well, so, before the pandemic, you know,
you saw I p o s like the incredible Beyond Meat.
I mean, it really was incredible investment in the space
and celebrity investors and it was really kind of blowing up.
It was to me, en was all about kind of
(12:03):
alt protein, whether that was milk substitutes or you know,
vegan eggs, etcetera, etcetera. I mean, the playing field really
expanded in the pandemic hit and no one knew what
was going to happen. You know, what what was it
going to mean for this fairly fledgling category, you know,
was it a fad um or did it have legs?
(12:23):
And I think that that a lot of things have
conspired too solidify that it really is a trend or
a movement rather than just you know, something kind of fleeting.
One thing that happened was that meat prices, especially for
beef and for pork, have dramatically increased, you know, they
really in grocery prices overall have really exploded, but those
(12:47):
categories have exceeded or kind of outstripped all the other
grocery categories. And so now at the grocery store, people
are comparing uh, you know, impossible meat to ground beef
and saying, huh, yes, the impossible is still a little
bit more expensive, but not way more expensive. So before
the pandemic, it was clear that you know, people who
(13:11):
wanted to enjoy these new products, these kind of you know,
animal free products. We're paying a premium for him. And
so those companies have scaled up, have increased their production facilities,
um are getting better deals on the basic ingredients just
as grocery prices in every other category has uh skyrocketed.
(13:33):
Let's do a little bit of price comparison, because before
this you mentioned the article, A pound of ground impossible
burger was like double that of even the fanciest ground beef.
It was pretty expensive, and you know, for those people
coming into it wanting to try it, I mean, that
could be cost prohibited for them. But right now it's
almost equal in certain cases. Beyond has really come down
(13:56):
quite a bit, so it's kind of maybe a little
under six bucks in a lot of store, and that's
comparable to kind of premium ground beef. Just eggs, their
prices have come down so that they're kind of you know,
they're still expensive. They're about fifty cents and eggs, so
that's more expensive than the commodity eggs in the grocery store,
but it's about on par with the kind of premium
(14:17):
pasture raised eggs that you'll find at the farmer's market.
So they're starting to reach that price parody point, which
a lot of the industry analysts said we were still
way far away from. So you know, a year ago
when I was talking to analysts, they'd say, oh, Gosho
at the very earliest, probably later than that that you'd
start seeing kind of price equivalence. And we're seeing this
(14:37):
much sooner than anticipated. And in a lot of cases,
you know, for like Pat Brown, it impossible or for
some of these companies, their goal is to undercut traditional
animal egg prices. Um that is their objective, and they
want to eat eat the lunch of you know, traditional
animal egg. And you may mention the article to something
really important that they were getting repeat customers with this,
(14:59):
because obvio see there's people that maybe want to try
something once or twice, but if they're coming back, then
you know, that just means more for them. Absolutely no,
I think that that's a key factor for all of this,
you know, I think there were people who were curious
and maybe one timers. And and the interesting thing is
this is mostly these products are not really for vegans
or vegetarians, season especially the meat one, this new round
(15:20):
of of all meat. They're really more for the kind
of omnivore or the flexitarian who's trying to go a
little lighter on meat, either for health reasons or for
the environment, you know, kind of carbon sequestration reasons. Um.
So I think that we're seeing a larger number of
people who are willing to try, and then a larger
number of people who are willing to make it kind
of a regular part of their diet. While these alternative
(15:43):
proteins are kind of growing right now, it's really just
a fraction of what the traditional beef, poultry, and pork
game really is. And a lot of these big companies
are jumping into that game. They're expanding their product lines
to expand into these alternative proteins as well. I think
that's one of the most surprising things is that you're
seeing you know, Cargill and and JBS and Tyson and
(16:07):
Hormel are all these huge meat companies joining, you know,
and it does feel like and they're all realigning themselves.
What you know, they used to call themselves meat companies
and now they're proutin companies. So they're expanding what they
do because no one really knows how big this new
market is going to become, you know, and I think
that they're kind of if you can't beat them, join them.
(16:27):
You know, that mentality works in this case. If you
offer traditional chicken nuggets and then also you know, vegan nuggets,
well then you kind of got all your bases covered.
So and those big companies, especially when you start getting
into like Archer Daniels Midland or companies that that really
produced the building blocks, you know, kind of the ingredients
for some of these other companies. You know, you're driving
(16:50):
down price by these huge economies of scale. Um. So
the more of these traditional animal ad companies that get
into this game, the more price pressure is going to
be on the traditional side of things. You know, you
made mention obviously prices are going up. There are we
going to continue seeing that? You know, the country's opening
back up, getting more back to normal. Um. You know,
(17:10):
during the pandemic, we saw huge things happening, labor shortages,
supply chain issues, all that stuff. Is that trend continuing
or is that easing up yet? Well, we haven't seen it.
So in terms of kind of data that came out
in the past couple of weeks, prices have been have
continued to be very high, and have been high for
beef and pork. So I don't think there's any indication
(17:32):
that those things are coming down. We still have all
kinds of supply chain problems and and you know, it's
the whole world is so interconnected now that even things
like this the computer chip shortage um that has all
kinds of trickle down ramifications for other supply chain uh
you know issues. So you know, I think that we're
very likely to see high continued high prices, especially because
(17:54):
we have tons of people buying groceries as we've seen this,
you know, through the whole pandemic, and now re restaurant
in the country has had to restock its walk in
so we're having a lot of price drivers right now.
Are are all those restaurants getting back in the game
and trying to get back up to capacity restaurants? What
are we seeing with them? We're seeing a lot of
things from YELP Open table about people just making reservations constantly.
(18:18):
That part of it is is coming back. It's good
for those restaurants that have been suffering so long throughout
the pandemic, well they are roaring back. I talked to
a chef yesterday in Las Vegas who said they had
three thousand people in Las Vegas last weekend and that
every restaurant was a capacity. The problem with that is
that staffing is still a massive shortfall for for so
(18:40):
many restaurants, so You're getting this real disconnect between the
fervor and enthusiasm for all of us who are sick
of our own cooking, you know, for the year of
living at home, we all want to get back with it. Myself,
I would out to dinner last night. It felt great.
You know, that's what we want to be doing right now.
But most restaurants, almost all the restaurants I know, are
(19:01):
still looking for staff so that they can staff up.
You're seeing these weird situations where a restaurant will be
two thirds full with a line out the door, and
they're telling people they're turning people away, and people are saying, well,
ead I see an empty table, said, well, if you
don't have the servers to service those tables and you
don't have the kitchen staff to make the food, doesn't
matter how many physical tables are in the restaurant. Laura Riley,
(19:25):
business a food reporter at The Washington Post, Thank you
very much for joining us. Oh thanks for having me.
That's it for today. Join us on social media at
Daily Dive pod on, above, Twitter, and Instagram. Gave us
a comment, give us a rating, and tell us the
(19:46):
scores that your interest today allow us and I Heart
Radio or subscribe wherever you get your podcast. This episode
of The Daily Divers, produced if Right and engineered by
Tony Sargentina him Moscar Pramirez. In this it was your
Daily Dive.
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