Philanthropist accuses Obama of ‘class warfare’
Leon Cooperman says president set tone by ‘bashing’ the wealthy
Leon Cooperman invoked his own rags-to-riches story in an ‘open letter’ critical of the president.
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December 14, 2011
Short Hills hedge fund manager and philanthropist Leon Cooperman says he didn’t vote for Barack Obama but agrees with the administration that America’s wide income disparities need to be addressed.
Where he parts company with the president is how that debate is being carried out. In an “open letter” to Obama that became an Internet sensation, the self-described “high-income taxpayer” accuses Obama of “setting the tenor of the rancorous debate now roiling us that smacks of what so many have characterized as ‘class warfare.’”
In the Nov. 28 open letter, Cooperman urges the president “to rise above the partisan fray” and “set a tone that encourages people of good will to meet in the middle.”
Cooperman’s letter was widely circulated via e-mail and later excerpted in the New York Post. It was variously praised and condemned by bloggers, and Cooperman discussed it with The New York Times financial blog and with Greta Van Susteren of Fox News.
Although the letter offers no specific solution to fixing the nation’s economic woes, Cooperman said in a Dec. 9 interview with NJJN that the income gap should be closed through education and expanding the economy — not “through bashing wealthy people for no particular reason. The wealthy people didn’t prosper at the expense of the people who are less wealthy.”
It is, as Cooperman will admit, a personal cri de coeur. As chairman and CEO of the Omega Advisors hedge fund, his worth is reported at $1.6 billion, according to Andrew Ross Sorkin in The New York Times. In the letter he describes his own rags-to-riches story; raised in the Bronx, Cooperman writes that his parents were Polish immigrants, his father was a plumber, and that he was the “first member of my family to earn a college degree.” After 25 years at Goldman Sachs, he started his own private investment firm 20 years ago.
The letter also refers to his own philanthropy, saying he has signed investor Warren Buffet’s “Giving Pledge” to donate a majority of his wealth to charity.
Among his philanthropic endeavors are the $5 million Cooperman Family Fund for a Jewish Future to endow Birthright Israel, Jewish summer camps, and mitzva projects through United Jewish Communities of MetroWest NJ; a $1.3 million gift to the Daughters of Israel nursing home in West Orange; and major support for JCC MetroWest, whose facility in West Orange bears the name of Cooperman and his wife, Toby.
In 2010, Cooperman said, he had already given away some $100 million in his lifetime.
“I never, ever, ever would have written that letter if the president had said, ‘We are in very difficult economic times and all of us have to do more, particularly those who can afford to do more,’” Cooperman told NJJN. “I have been saying for a year now that anyone making over $500,000 a year should have a 10 percent tax surcharge for the next three years as we work our way out of this problem. I have no problem paying taxes. I have no problem supporting people who are less fortunate than myself. My charitable giving is probably 100 times annually what I spend on myself.”
Although he doubted that 1 percent of the American people control 99 percent of the wealth — as supporters of the Occupy Wall Street movement argue — Cooperman said he recognizes the fix the economy is in.
“There is a very wide disparity in income between people, and the disparity has probably never been greater, so I am sympathetic to that view,” he said.
Cooperman told Van Susteren that in past presidential elections he voted for Ronald Reagan, Al Gore, George W. Bush, and John McCain.
“I didn’t vote for Obama, and I’m happy I didn’t vote for Obama,” he told NJJN. “I hope he is a one-term president.”
But, he added, “there is no question that Obama has a tough hand because there are a bunch of crazy people in Congress. I am not a Democrat or a Republican. I vote issues, and one of the problems today is that there are no moderates in Congress. We’ve got a bunch of radicals on both sides.”
Cooperman said he would not have gone public if it had not been for what he called “the divisive, polarizing tone” of the president’s rhetoric.
Reaction to Cooperman’s letter among those active in the Jewish community was, perhaps predictably, polarized.
Conservative talk show host Michael Medved praised the letter on his radio program.
One local Republican thinks that Cooperman “put his finger right on it.” For more than 30 years. Jack Schrier was active in Morris County GOP politics, serving as a freeholder and mayor of his hometown of Mendham.
“Obama has gone so much to the partisan side that he has doused the flames of cooperation that have existed,” Schrier said. “What is happening now is there is an anti-Obama feeling in Congress, even among Democrats. It is that anti-presidential feeling that is causing a lot of the problems. He is an igniter, not a uniter.”
But Simon Greer, president and CEO of the Progressive Jewish Alliance & Jewish Funds for Justice, said he appreciates Cooperman’s frustration, but thinks he may have picked the wrong target.
“The letter is angry, but why so much anger?” asked Greer, who in January will become head of the Nathan Cummings Foundation. “There is a lot of anger in America rightfully or wrongfully at Wall Street and the hedge funds and the banks. I don’t think it emanates first and foremost from the president. I think it emanates from the Tea Party and Occupy Wall Street and a lot of corners.”
But Greer suggested that the time is ripe for all those who would like to fix the broken economy to work together.
Said Greer: “This is a moment when someone like me and someone like Mr. Cooperman should be sitting down and saying, ‘What do we do to solve these problems?’”
‘Dear Mr. President’
Leon Cooperman released his “Open Letter to the President” on Nov. 28. Below is an excerpt:
“…I cannot credibly blame you for the economic mess that you inherited, even if the policy response on your watch has been profligate and largely ineffectual. (You did not, after all, invent TARP.) I understand that when surrounded by cries of ‘the end of the world as we know it is nigh,’ even the strongest of minds may have a tendency to shoot first and aim later in a well-intended effort to stave off the predicted apocalypse.
“But what I can justifiably hold you accountable for is you and your minions’ role in setting the tenor of the rancorous debate now roiling us that smacks of what so many have characterized as ‘class warfare.’ Whether this reflects your principled belief that the eternal divide between the haves and have-nots is at the root of all the evils that afflict our society or just a cynical, populist appeal to his base by a president struggling in the polls is of little importance. What does matter is that the divisive, polarizing tone of your rhetoric is cleaving a widening gulf, at this point as much visceral as philosophical, between the downtrodden and those best positioned to help them. It is a gulf that is at once counterproductive and freighted with dangerous historical precedents.”
Comments
milton turoff
December 14, 2011
What else can one expect from Obama? He was reared by radicals, taught the Saul Alinsky way, surrounded by revolutionaries, anarchists and others of that stripe. So he most certainly knows what he is doing. His appointees include admirers of the likes of Marx, Stalin, Mao, Castro, Chevaz, et al. He would transform us into a way of life experienced by those dicators of the past—and present.
I end my piece as I began it: What else can one expect from Obama? To which I add: and we’ll get it if he is reelected.
Brian Pollock
December 14, 2011
Amazing! I don’t know what world Mr. Cooperman lives in but the problem Obama has is that he has tried much too hard to get bipartisan support with people who will disagree with him regardless of his position on anything. Obama creating the rancor? Ridiculous. Obama should have realized that the days of real Republicans like Hugh Scott, Nelson Rockefeller and Gerald Ford are over and have been since Reagan. Today they do anything to get a vote. They embrace every bigot, racist and anti-Semite. Rove and the boys simply want to win for their well healed cronies and turn the USA into a third world country. People like Eric Cantor are the problem and an embarrassment.
Bob Schultz
December 15, 2011
To Brian Pollock:
“Amazing! I don’t know what world Mr. Cooperman lives in but the problem Obama has is that he has tried much too hard to get bipartisan support with people who will disagree with him regardless of his position on anything.”
Please detail the efforts Obama has made to garner GOP support. As I recall, it was Obama who stated publicly to McCain at a debt resolution conference, “I won.” It was Obama who publicly insulted Paul Ryan over the budget passed by the House. It is Obama (and his crony, Reid) who will not allow passage of a bill to extend the FICA payroll tax reduction because it contains authorization for a Canada-US oil pipeline (which Obama stated previously that he favored). It is Obama who makes speeches accusing Republicans of wanting to make the poor go hungry, the sick die and poison the environment.
“They embrace every bigot, racist and anti-Semite. Rove and the boys simply want to win for their well healed cronies and turn the USA into a third world country.”
Perhaps you can elaborate on your claims. I do know that Obama has embraced relationships with Jeremiah Wright, Rashid Khalidi, Al Sharpton and others who could be so characterized.
“People like Eric Cantor are the problem and an embarrassment.”
Who are those “people”, Jews who do not toe the liberal Democrat line? It sounds like the bigot just might be you!
Leonard Krawitz
December 16, 2011
Mr. Cooperman is critical of President Obama for his allegedly starting a class warfare. Mr. Cooperman states that he made his money as a hedge fund manager. I wish to pose a question to him. What value did his lucrative hedge fund activity add to the American economy? What value have all the hedge funds added to the American economy? Not much that I am aware of. Your hedge fund has evidently been smarter at skimming profits from the economy, but it and others of its kind have neither added productive jobs nor provided equity financing for new developments If there is any class warfare, it is coming from people in your ‘class’ and not from President Obama. Our President is merely requesting a measly little 3 percent incremental increase in the marginal tax of people who can afford it.
As a member of the Metrowest JCC, perhaps I should be grateful for your largess to that organization. But I do think that you should reconsider your criticism of President Obama, and understand that this incremental tax increase will go a large way in assuring that you can live in a stable social environment.
Bob Schultz
December 16, 2011
To Leonard Krawitz:
The IRS reported that in 2009, the last year for which full data is available:
Total personal adjusted gross income (AGI) for all earnings groups was…..........$7.6 trillion
Total AGI of all filers reporting over $1 million…............................................$726.9 billion
Persons reporting over $1 million accounted for 9.5% of total personal AGI.
Total federal income tax paid by all individual taxpayers….............................$865.9 billion
Total federal income tax paid by persons reporting over $1 million AGI….......$177.5 billion
Persons reporting over $1 million AGI paid 20.4% of all individual income taxes.
The current top marginal tax rate is 35%. Let us create a hypothetical tax increase to please class warriors like Messrs. Obama and Krawitz, who believe the rich do not pay their “fair share.” If we were to double the top marginal rate to 70% for those earning over $1 million, the IRS would realize additional annual revenue of $177.5 billion. Since the 2011 budget deficit is $1.3 trillion, the budget deficit would remain over $1 trillion. If the government went so far as to confiscate 100% of income of those making over $1 million, the budget deficit would still approximate $1 trillion.
Class warriors ignore the reality that significant spending reduction is required to restore fiscal stability. As the US continues to deficit spend, the national debt and its servicing costs continue to increase. Balancing the federal budget through spending cuts and revenue increases are no longer an option as a short-term goal. The long-term goal should be generation of budget surpluses to decrease the nation debt, which is rapidly approaching $15 trillion.
It has been demonstrated in the past that lower, rather than higher marginal tax rates generate additional revenue to the government. Perhaps we should begin by lowering corporate tax rates to encourage return of capital to the US. If companies like GE are encouraged through lower corporate tax rates to return manufacturing facilities to the US, it will initiate a domino effect of economic stimulation: i.e., plant construction, material and service suppliers and company workers. These companies will again pay US taxes, as will the vendors and suppliers, and best of all they will employ more tax-paying Americans.