The topic of tax increases is again very much in the news. President Obama has just announced his intention to put forward yet another tax plan to close tax loopholes and increase the marginal rates on the rich, which he now restricts to persons whose income is $1 million or more a year. In order to lend legitimacy to this campaign, he has chosen to invoke the confessions of Warren Buffett to justify his proposal. After all, if one of the richest of men alive is willing to accept tax increases on the rich, how could any mere millionaire oppose that position?

I have already written at length about why Mr. Buffett should follow the advice oft given to the humble shoemaker by sticking to his last. However successful he is in the world of finance, his skills lie in working within the system, not in figuring out the rules of the game.

Mr. Buffett and the president are not alone in their determined inability to understand how economic systems work. In the past several weeks, I have been peppered with pointed criticism insisting that any concern with the effect of marginal rates of taxation on high-income earners is overwrought.

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