I think that Romney’s Hayekian modesty probably makes him immune to attacks on his vulture capital ways, but in a normal world, it would be striking that a man is running for president in part so that he can continue to give him and his company a big tax break:
We talked last week about Mitt Romney’s decision to keep his tax returns hidden, despite the fact that every major-party nominee in the post-Watergate era has released their tax records. Romney’s position has already generated some pushback from Newt Gingrich and Rick Perry, and if Romney wins the GOP nod, Democrats will likely keep this going.
It’s worth noting, however, that Romney isn’t just being secretive for the sake of secrecy — there’s a good reason he’s rejecting transparency. Alec MacGillis flagged this Boston Globe piece, which suggests Romney is, in fact, paying a lower tax rate than nearly everyone else, which probably has a lot to do with his campaign’s decision.
In case anyone needs a refresher, there’s a tax loophole on “carried interest” — sometimes called “the carry” — that taxes private equity and venture capital income at a lower, 15% rate, as compared to 35% on ordinary income. Hedge-fund managers and the Wall Street have fought tooth and nail to protect this loophole — even after the Obama White House tried to eliminate it — and so far, they’ve been successful.
Linda Featheringill
I wondered if actually running for office gave you tax breaks but I read the linked article and noted that if Romney actually wins something, he might have the power to preserve his tax breaks.
Aha!
Professor
Why hasn’t anyone asked Mitt Romney whether he has any Trust entity Domiciled in BVI, Cayman Islads, Jersey etc. This type of arrangement will help him avoid paying taxes on his worldwide income. It is called Tax Avoidance which is LEGAL.
BGinCHI
I’d like to see Mitt’s Hayekian Modesty turned from Maker to Taker and then used to smash that fucking stupid idea once and for all.
Even Tweety ought to be up to that challenge.
I think the Dems are saving this angle for after he gets the nom. Then he gets the Thurston Howell treatment.
Mark S.
I thought Republicans liked low taxes for job creators. Think of all the jobs Mitt’s created by only paying 15%!
David in NY
@Mark S.: I didn’t know that people who were “unemployed” could be job creators! What a wonderful world.
Villago Delenda Est
“The Carry” represents everything that is wrong about the financial position of the top 1%. It’s 180 degrees out of synch with how a just tax system would be structured.
This is the sort of bullshit that should be trumpeted by the Democrats. This is the same sort of shit that got the French aristocracy into so much trouble in the late 18th century. It may take a French solution to resolve it in the early 21st.
BGinCHI
@Mark S.: Undocumented yard work kingpin.
BGinCHI
@Villago Delenda Est:
I don’t see how surrendering is going to help anything.
David in NY
@Professor: Legal and wrong. It’s a sleight of hand permitted by partnership law that converts what is plainly ordinary income into capital gains. It in no way furthers the supposed justification for taxing capital gains lower than ordinary income; the one who benefits from the carried interest rule gets a windfall because he or she is getting the lower tax rate without running the risk of investing his or her capital. Little better than three-card-monte embedded in the tax law.
Waldo
One more reason why I’m rooting for Newt to stay competitive. It will be best if another Republican raises this issue, but it’s probably not going to get a lot of traction if, say, a Huntsman or a Santorum are squawking about it.
Smiling Mortician
@BGinCHI: Heh.
Davis X. Machina
Doesn’t matter. Romney’s white. He wears a suit. He makes president-noises. He’s got an ‘R’ after his name. As a result, he has a floor of 50-60 million popular votes.
That’s the problem, the problem with America, really, right there.
Enough bright, shiny things and manufactured outrage to get ten million more votes, and you’ve got the Mittster in the White House through 2020.
Of course, if Obama had just installed the public option via signing statements or Medicare for all by executive order, we’d not be in this bind.
BudP
Perhaps Romney is hiding tax deductible donations to Planned Parenthood. It would be irresponsible not to speculate.
kindness
It’s obvious that Romney doesn’t want to get called out for paying less in taxes (as a percentage of his gross) than your typical middle class family.
He may think he can get away with it but honestly those Teabaggers will be very unhappy when they see they are getting taken by another flimflam man.
Davis X. Machina
@kindness:
They will crawl over broken glass to vote for Romney as many times as their shiny new election laws allow them to get away with.
I don’t think there’s any limit to the desire to get that awful Negro out of the White House. None. Not economic self-interest, not dynamiting your children’s future, or the future of the planet. None. Reason left the building with Elvis.
Next election is a census, pure and simple. How many of them are there? Because they will turn out. They’re standing at Armageddon and doing battle for the Lord.
DFH no.6
Unfortunately, the “Thurston Howell III” aspect of Romney will mostly be a feature, not a bug, for his general election candidacy.
Certainly for the 50 million voters who will cast their ballot for him simply because he’s the R candidate.
But it will also be portrayed in a positive light (for the most part) by the media, and his alleged “business savvy” (proven by the fact that he is fabulously wealthy) will be a prominent part of the media narrative about Romney.
How that narrative is received by swing voters (the true independents who don’t always just happen to vote R, and the conservadems) will likely decide the election.
kay
@Davis X. Machina:
I agree. I still think it’s going to be Romney, but it really doesn’t matter, Gingrich, Perry, would have been the same thing.
FlipYrWhig
OT: TPM says that Ben Nelson is retiring. Any progressive hopes waiting in the wings in Nebraska?
WereBear (itouch)
Romney’s flaws are those of ommission, not commission. But with his record the Base has to hate him; and he excites no one else. I question the floor assumption.
McCain was a “war hero” who had to pick Palin beforeanyone got excited. Can Bible Spice lightning strike twice?
MikeJ
@DFH no.6:
Yes America, put the tax cheat to work for *you*!
Mark S.
Maybe, but then Rush will say something about Saul Alinsky and they’ll be back to foaming at the mouth about gay illegal Muslim immigrant Communists.
Davis X. Machina
@DFH no.6: A taste for forelock-tugging, and a lusting after hierarchies is, I am afraid, part of human nature. Self-government is profoundly un-natural, and hard work to boot. It’s a wonder we have as much of it as we do, and it works as well as it does.
Davis X. Machina
@FlipYrWhig: Depends on the incidence per 100,000 of suicide in Nebraska.
The Moar You Know
@FlipYrWhig: The Nebraska “progressive” is retiring, sounds like.
+1 seat for the GOP.
David in NY
@FlipYrWhig:
You mean, “Any progressive hopes who stand a snowball’s chance in hell of winning waiting in the wings in Nebraska?”
David in NY
Well, @FlipYrWhig: certainly got our attention.
pete
@The Moar You Know: Makes the math easier, no?
catclub
Given that carried interest did not get wiped out by the 2009 congress – which was abnormally democratic leaning, Romney does not need to be elected to keep his caried interest tax rate.
Yes, Romney wants to hide his carried interest benefits
from voters.
No, he does not need to be elected to keep it.
gnomedad
If ever a photograph sunk a candidate that one should, but the Randians probably have velvet wall-hangings of it next to the poker-playing dogs.
David in NY
@FlipYrWhig: Steve Benen comes up with Bob Kerrey (D-Kinda Crazy, Currently Residing in NYC) and Chuck Hagel (R, no need to say more).
gnomedad
No freaking clue why my last comment is in moderation.
ETA: ah, p o k e r
FlipYrWhig
@David in NY: The Bill Halter of Nebraska just got the opportunity of a lifetime. There was a onetime “netroots” favorite named Scott Kleeb who might still be around. Hopefully Bob Kerrey isn’t eyeing a comeback.
rlrr
@DFH no.6:
proven by the fact that he is fabulously wealthy
He’s fabulously wealthy largely because of his birth…
Southern Beale
DNC has put up a widget where you can calculate your family’s income tax rate if at Mitt Romney’s vulture capital rate. It’s called WhatMittPays.com.
My family would save close to $9,000.
kindness
Abnormally democratic leaning? That’s almost a strawman argument. While there were a majority of Democratic Senators and Congresspersons, the Senate in particular had many Blanche Lincolns. In reality, there were no more actual democrats than any other time.
And as such, the party reaped what it did sow. Which was surprisingly good for that bunch of idiots. Would I have liked more? Yes. Doesn’t matter. Didn’t happen. Too many shrieking harpies.
FlipYrWhig
@David in NY: I had forgotten Hagel… Interesting as a “party left me” effort perhaps.
Villago Delenda Est
@rlrr:
Which is why Thomas Jefferson worked hard to get an estate tax implemented, because he wanted to avoid the wild disparities of wealth of the Europe he saw in the late 18th century on this side of the pond…an aristocracy in all but name on this side of the pond, based on which uterus you fell out of.
BO_Bill
In order to understand this year’s Presidential politics, and the emergence of the #OWS movement, it is necessary to understand Astronomy, and the Geometry of the Earth.
Mankind has assigned a metric to distance from the Equator, and called this metric ‘Latitudes’. Latitudes represent parallel planes from the equator and are assigned the value of ‘0 degrees’ at the Equator, and ’90 degrees’ at the extreme north and south points of the earth, also known as ‘poles’.
Al Sharpton’s people studied ‘astrology’ while the Greeks were still living in caves, so they are probably responsible for developing the knowledge and science of the ‘Solstice’ and ‘Equinox’, as well as being the source of valuable economic stimulus for the nation with each release of Air Jordan sneakers.
The Solstice represents the maximum tilting of the earth around its Axis. The Equinox represents that moment of time where a second degree differential equation modeling rate of change of the length of days is zero. To illustrate, we recently observed the Winter Solstice (December 22th at 0030 EST). So in our case the days have begun getting longer in the Northern Hemisphere, and shorter in the Southern Hemisphere. This change will accelerate until the Spring Equinox, and then decelerate until the Summer Solstice. The cycle is omni-present over all parts of the Mother Earth and can be modeled by a sine wave.
Roger Moore
@BudP:
I think he doesn’t want the LDS Church to realize he hasn’t been tithing the full 10%. IWBINTS.
Linda Featheringill
@Davis X. Machina: #15
Actually, I felt that several things disappeared when Elvis left. :-)
Schlemizel
@Villago Delenda Est:
If we do get to a “French solution” I hereby volunteer to run the cutty thingie – I’ll even bring yarn for Mdm DeFarge
Yutsano
@BO_Bill: I see a bunch of words that have no meaning…
Paul in KY
@BGinCHI: Good one ;-)
gnomedad
Someone needs to alert Brick Bong Bill that Ron Paul is not yet president.
Soonergrunt
@gnomedad: cleared.
SiubhanDuinne
@BO_Bill:
And your point?
Oh wait, never mind, it’s BOB.
DFH no.6
@Davis X. Machina: @Davis X. Machina:
Not 100% convinced it’s human nature (though it does seem likely, I suppose), but it’s interesting how some find it surprising that Americans (being the stalwart descendants of the Sons of Liberty and all) by and large love the rich and powerful.
I don’t find it surprising at all.
Schlemizel
@rlrr:
I’d like to reiterate something that has been posted here a few weeks ago.
The winners of the lucky sperm club, the 6 children of Sam Walton, have a combined net worth greater than that of the bottom 140,000,000.
Not because they are smarter, not because they produced anything, not because the created a single job, not because they worked even a single day in their entire lives but because their sperm was the first one through the ovum wall.
140,000,000 / 6
burnspbesq
@Villago Delenda Est:
While there is no policy justification for taxing what is obviously compensation at capital gain rates, your rhetoric is ridiculously over the top.
Davis X. Machina
@Yutsano: Colorless green trolls sleep furiously. Mayby Chomsky was right.
Soonergrunt
@Yutsano: that could be said of several of our trolls.
At least that particular spew, while wildly off-topic and pointless, was at least mildly entertaining. Just go back and re-read it, but use that voice from the video tape lectures from Junior High health class, and it will be so much better.
lacp
@BO_Bill: TimeCube. You forgot TimeCube.
Davis X. Machina
Commenter Kaneblues at TMP: … Ben Nelson’s retirement sets up a shot at a bi-partisan, country-uniting ticket: Willard/Ben.
For people who like movies about rats.
Yutsano
@Davis X. Machina: @Soonergrunt: It still brings me back to “A Fish Called Wanda”. It might be a personal problem.
BO_Bill
Behold Mother Earth, with the equator superimposed upon her. Witness that the Latitude at the Equator is Zero Degrees, and the Latitude of Denmark is Fifty-Six Degrees North.
DFH no.6
@rlrr:
Of course he is. As are most (not all) fabulously wealthy people.
I’m talking about the media narrative.
Only a minority of the media discussion about Romney will in any way be negative concerning his personal wealth.
On the contrary, his so-called “business savvy” will be portrayed as just the sort of thing America needs in these trying economic times, with his wealth as the proof of just how good he is.
Most of us here could write the Village screeds in that regard in our sleep.
burnspbesq
@Schlemizel:
As long as NFIB has brainwashed every dry cleaner and pool-service owner into believing that they will someday be rich enough to pay estate tax, you’re not going to win on this issue. Be happy that we still have an estate tax at all.
It’s far from clear that treating death as a realization event and marking the decedent’s property to market would be easier to administer or raise more money, and you have no chance whatsoever of getting that enacted.
Chuck Butcher
@DFH no.6:
And the Village will…
Chuck Butcher
@burnspbesq:
There is that, but there is also the fact that wealth does not want it to happen, which is a factor to disregard at the risk of inaccuracy.
Yutsano
@BO_Bill: BoB knows geography. Someone get him a cookie.
rikryah
the ads do write themselves. they really do.
Keith G
Severly OT, but..
Take that, Dick Cheney:
Actually, the Duke was not wielding a fire arm, but just joined in a prehunt gathering (another Cheney favorite). I do love this detail offered by the Telegraph.
Schlemizel
@Davis X. Machina:
Not just the furry kind of rats either as those two are hairless rats.
Too bad Mikey bought the farm, he could have sung their campaign song.
Hob
@SiubhanDuinne: His point is that we should pay attention to him, because that amuses him; and to react to his cryptic remarks about “Al Sharpton’s people” as if he’s making some offensive argument– based on our previous experience with his racist bullshit– at which point he can accurately deny that he made any coherent argument at all, because that amuses him. Also, he’s been banned from PZ Myers’s blog so he needs somewhere else to practice making sciencey-sounding noises.
jpe
@Professor: That’s not legal in the slightest.
DFH no.6
@kay:
I think it matters a lot.
I do agree that Gingrich or Perry would be essentially the same as Romney in the general as far as the “floor” of the voters that will cast a ballot against Obama no matter what (Werebear questions the floor, but I believe Davis X. Machina is correct that it’s at least 50 million).
The main difference – and the reason I’m rooting for anyone but Romney – is that Romney will be palatable (and then some, I’m afraid) to the swing voters who will decide the election in a way that the nuts and bozos (all the rest of the R candidate crowd) will not.
Obama will thus have a very tough fight against Willard.
I think any of the others are just too-obviously crazy (Bachmann, Paul), stupid (Perry), or offputtingly evil (Gingrich) to appeal to enough of the swing voters.
Obama would beat any of the NotRomneys pretty handily.
Villago Delenda Est
@burnspbesq:
So, explain the policy that’s supported? Why should people who already have a huge pile of money get more money just because they have a huge pile of money? They do very little to expand the economy, from what I can see. Just take a look at all these $100 million a year CEOs presiding over a country with an admitted unemployment rate of 9%?
That garbage like Romney will “create jobs” because they’re being taxed at a lower rate for income that has nothing to do with the sweat of their brow? Which is basically more free money for someone who was born with free money?
burnspbesq
@Chuck Butcher:
Actually, you’ve got it backwards. In 2010, there were less than 15,200 estate tax returns filed, less than 6,800 of which showed a balance due. Without obtaining the political support of a mass of people who don’t really stand a chance of ever having to pay estate tax, the people who really care about the estate tax have no shot at doing anything about it.
http://www.irs.gov/taxstats/indtaxstats/article/0,,id=210646,00.html
This is the definitive book on the politics of the estate tax (in the interest of full disclosure, one of the authors was my tax prof in law school).
http://www.amazon.com/Death-Thousand-Cuts-Taxing-Inherited/dp/0691127891/ref=sr_1_3?ie=UTF8&qid=1325016430&sr=8-3
Mark S.
@burnspbesq:
Everybody needs to tone down the rhetoric for burnsie.
God you’re a pompous douchebag.
carpeduum
“I think that Romney’s Hayekian modesty probably makes him immune to attacks on his vulture capital ways.”
Note to DougJ. Don’t think.
The media will tear him apart on this nonstop if he gets the nomination. Dems will tear him apart. He will eventually be forced to produce the records. It will be his “long form birth certificate” moment. Except in this case it will only make him look worse.
kay
@DFH no.6:
I would have agreed with you, but Romney is a horrible candidate. I’m shocked at how bad he is. I assumed he would be better.
I still think Obama will have a hard fight, but Romney is beatable. He’s not good at this. There’s something essential missing in him. He’s somehow both needy and pleading and arrogant. Just such an unfortunate combination.
FlipYrWhig
@kay: Everything the press corps saw in Gore, or egged each other on to see in him, seems to be actually true of Romney.
carpeduum
Capital gains taxes should be lower. It’s the same in Canada and as someone who lives on capital gains this is one area where I disagree with many on the left. It is false equivalency to try equate capital gains tax with income tax.
If it wasn’t there would not be nearly as much market capitalization in the stock market which does eventually trickle down to employment.
burnspbesq
@Villago Delenda Est:
If you put money in a bank or a credit union, you get interest (i.e., compensation for the use of your money). If you direct the investment of your 401(k) account into equities, you (hopefully) earn dividends and capital gains. Money is fungible. Why should your or my small piles be treated differently than other people’s bigger (or smaller) piles?
The argument you’re struggling to make is an argument about whether our tax system should be more progressive. FWIW, if you think it should be more progressive, I agree with you. So do some fairly smart economists.
elsa.berkeley.edu/~saez/derive.pdf
carpeduum
@burnspbesq: The justification for lower capital gains tax is to promote investment in public companies. On that justification I agree.
Obviously, there is an argument to be made that since this tax mostly favours wealthy people they have a selfish interest in keeping it low. We can argue that and argue what the rate should be.
But to just say it’s unfair because it’s lower than regular income tax is childishly simplistic.
liberal
@carpeduum:
No it doesn’t. Most business investment comes from retained profits. Very little comes from the stock market; in fact, over some periods of time, there’s a net removal of capital via the stock market.
LOL.
burnspbesq
@Mark S.:
Is that the best you can do?
Southern Beale
Um … y’all see this bizarro holiday video from the Gingrich campaign? “NewtHampshire”??
It’s the craziest thing I’ve ever seen.
The Bobs
@carpeduum: What if capital gains comprise most/all of their income? Is that false equivalence?
It’s clearly all about you, isn’t it?
Mnemosyne
@burnspbesq:
But isn’t that Villago’s argument, that Romney’s bigger pile shouldn’t get better tax treatment (ie lower tax rates) than my smaller pile? His bigger pile should be taxed at the same or similar rate as my smaller one.
If Romney’s interest income was taxed at the same rate as the income I earn through working, I think you, Villago and I would all be happy. Romney, not so much.
liberal
@carpeduum:
Ultimately, the justification is that if the rate is raised too high, then investment will suffer.
That’s an empirical question. AFAICT the evidence behind the claim that if we eliminated the cap gains preference investment would suffer is weak.
Furthermore, a lot of “investment” is not true investment in productive capital, but investment in rent-producing assets that doesn’t add a damn thing to the economy. Like investment in land.
Mnemosyne
@carpeduum:
Why? I have to work 40+ hours a week to earn my income. Romney doesn’t have to lift a finger for his. So why does he get to pay lower taxes? If anything, his should be taxed at a higher rate since he does less work to get it.
And I think the “but he’ll re-invest it if he gets a lower rate!” has been proven to be bullshit at this point.
burnspbesq
@carpeduum:
I don’t think I’ve said that previously, but I’m happy to say something like it now. There is no justification for a preferential rate on capital gains (or, for that matter, qualified dividends).
The empirical evidence is overwhelming. Go look at investment data for the periods when there was no differential. Did investment evaporate? No, it didn’t.
And the unpleasant side effect of preferential treatment of capital gains in a progressive income tax system is that it leads inevitably to concentration of wealth in the upper reaches of the income distribution, which is exactly what we’re seeing now. Even a cursory look at IRS statistics of income data (all of which is readily availabe on the IRS website) makes that clear.
I’m happy to have this conversation all day. But don’t show up at a knife-fight with just a nail file.
Soonergrunt
@BO_Bill: Cool story, Bro.
@carpeduum:
This is what economists call a load of shit.
Since there would be no capital gain if the money were reinvested into the business or other investment within that tax year, there would be no capital gain to tax.
burnspbesq
@Mnemosyne:
It probably is. Even if it’s nominally “tax-exempt” interest on municipal bonds, if he has enough of it it will put him into AMT.
I won’t presume to speak for Villago, but I am not happy that Romney’s interest income is taxed at the same rate as mine. There should be more brackets, and the income tax should be more progressive.
Interest isn’t the problem. Dividends and capital gains are the problem.
Mark S.
@burnspbesq:
What did Villago say that was so “ridiculously over the top?” That a tax system where Romney pays a lower rate than his secretary is the opposite of a just tax system? Yeah, that’s fucking ridiculous.
But please, give us a condescending lecture on the difference between a flat tax and a progressive one, since none of us know the difference.
burnspbesq
In order to believe, as carpeduum appears to believe, that the current preferential treatment of capital gains and dividends is a necessary condition for capital formation, you have to believe that the income tax rate where the slope of the Laffer curve turns negative is somewhere in the 20-25 percent range.
The historical evidence suggests otherwise. The capital gains tax rate was higher than 25 percent from 1968-1980 and 1987-96. From 1968-81, the rate on dividends was 70 percent, and from 1987-96 it was between 28 percent and 40.8 percent.
I don’t think there was much of an issue with capital formation during either of those periods.
burnspbesq
@Mark S.:
Did you miss the part about “the French solution?” I don’t think that referred to a French tickler.
jpe
There’s appeal to that reasoning, which makes it all the more interesting that virtually every country at all times has taxed capital gains at lower rates than labor or interest.
Mark S.
@burnspbesq:
I thought you were objecting to what you put in the blockquote. Never mind.
Villago Delenda Est
@burnspbesq:
When the French aristocracy came up with a “you peasants pay the taxes, we don’t” paradigm in the late 18th century, it resulted in some, er, disruptions in society.
The French middle class and lower class came up with their own response to the arrogance of the aristocracy. One that decimated, or worse, the French aristocracy.
The situation in this country is no better. People get pissed, they start running on pure adrenaline, they see that they really have nothing to lose by engaging in some disruption.
The smart members of the 1% realize this.
The ones who are blinded by their insatiable greed do not.
They might just lose their heads over this.
Kay Shawn
DougJ — nice title! Did I miss if anyone else commented?
…a long time.
Mnemosyne
@jpe:
Not really — the people who make capital gains have most of the money, they have the most influence over the legislatures, they can write their own rules.
No legislator anywhere is going to vote for a law that means the most powerful (aka richest) people of the country are going to lose money thanks to him.
carpeduum
@liberal: Go learn the basics of how the economy works. Then maybe we can discuss the possibility of actually discussing it.
carpeduum
@The Bobs: You are projecting. It’s all about YOU not having the same advantage…yes.
carpeduum
@liberal: Sigh….again we can debate on how much is this and how much is that. First go learn how the economy works…at the macro level…then we can talk.
carpeduum
@Soonergrunt: Yawn…another armchair economist. Corporations pay taxes. Capital gains are also taxed. So it’s a double tax. You do understand that do you not Mr armchair ecomonist?
Mnemosyne
@carpeduum:
Dude, put down the Laffer curve and walk away. “Trickle down” doesn’t exist.
carpeduum
@Mnemosyne: In the Growing Old Prematurely party sense…..no.
But do you also disagree that corporations employ people?
Mnemosyne
@carpeduum:
Despite what the Supreme Court tries to claim, corporations aren’t people. Until the government decides that it’s a double tax because both I and the corporation I work for have to pay income taxes, your “double tax” situation doesn’t exist.
And guess what? For the few years when I do have capital gains or interest income, I have to pay tax on those in addition to having to pay income tax on my salary. So I get double taxed no matter what. Why are you supposed to be exempt from the same taxes I get hit with?
carpeduum
@Mnemosyne: Bahahah. A childisly simplistic argument which clearly shows you do not understand the subject matter whatsoever. I’m done with you my little groupie.
Mnemosyne
@carpeduum:
I’m employed by one. I pay income tax on what they pay me. So your argument is that, because I have to pay income tax, the corporation should be exempt from income tax because that’s double taxation?
Funny how you worked that out in favor of the corporation and not us drones who have to pay income tax out of our tiny salaries.
Mnemosyne
@carpeduum:
Shorter carpeduum: Only peasants pay income tax!
Stroke that Laffer curve a little harder and maybe this time you’ll get a trickle out of it.
ETA: Though I almost have to admire your insistence that the economic disaster we’re in right now is proof that the theories you prefer “work.” It’s like the designer of the Titanic going down with his ship to prove that it really is unsinkable, damn it!
Yevgraf
My issue with the sweet treatment of capital gains is that it incentivizes the production of bullshit information in the wrong direction.
If you think about it, the production of reports gaming underlying stock values has been the feature of a great deal of our national financial calamities this go ’round. From the bullshit ratings agencies to bullshit production projections to bullshit projections on cost savings to bullshit excitement over the appointment of certain individuals as CEOs/COOs/CFOs, all of it has been used to fluff stock prices to points which make no sense.
You can’t exactly game the routine payment of *gasp*dividends, the existence of brick and mortar mnaufacturing facilities, the existence of a skilled, customer-oriented workforce.
Were it up to me, I’d incentivize the payment of dividends on stocks held for 3 years or more.
Soonergrunt
@carpeduum: It doesn’t fucking matter if it’s double taxed, triple taxed, or eleventy-billion taxed.
Money isn’t taxed. Entities are taxed. And you are a separate entity from whatever corporation stole or extorted the money in the first place. They pay taxes on their profits and then when you get your money, you pay taxes too.
It really isn’t that hard to figure out if you’re not completely full of shit in a Mitt Romney kind of way.
burnspbesq
@Mnemosyne:
The Laffer Curve, in and of itself, isn’t the problem. In fact, unless you don’t believe in the diminishing marginal utility of wealth, the Laffer Curve is logically inevitable.
The problem is with the “insights” that folks like carpeduum draw from the Laffer Curve.
Odie Hugh Manatee
@Soonergrunt:
Fix’t.
BO Bill. Bad Odor Bill. Fitting. If the foo shits, wear it.
BO is wearing it, proudly.
KCinDC
Time for a classic Tom the Dancing Bug: “Spot the Double Taxation”.
Chuck Butcher
The theory behind favorable cap gains treatment is the one Carp is going on about. The little matter of it not being based in anything other than wishful thinking is not to be addressed. Rates and economic performance show differently. That doesn’t begin to address the little matter of how those cap gains are generated, and it is very seldom from long term investment in a company’s future. Buying a stock low and turning it high, repeatedly, is not what creates jobs.
It has even less to do with things the “common” folk get on about, such as the sale of a house. Once you’ve been in a house for awhile there really isn’t much of any kind of profit to be made, interest, maintainence, property taxes all play against that profit. Properly a house is more of a bank than a profit source.
jpe
@ Burns: muni bond income won’t put one in AMT. Private activity bond income, a small subset of muni bonds, may, but vanilla muni bonds won’t.
@ Mnemosyne: if corps aren’t people, then it’s quite clearly double taxation. If my assets are in one pocket that’s a corporate form, it’s taxed there, then taxed again when I put it into my other pocket. Your argument that corps aren’t people strengthens, rather than diminishes, the double taxation argument.
re: wages and double taxation: the difference is that a corp gets a deduction for wages paid, while it gets no deduction for the dividend paid. So, yes, entities are taxed, but what matters here is the ability to avail oneself of a deduction or not for business income & expense.
doofus
@carpeduum: Astounding. I have disagreed with every post you have ever written. I think you might be at the wrong blog. Maybe Red State is more your speed.
rikyrah
What’s missing is his SOUL.
He’s a human cipher with no core.
Joe Buck
Isn’t a lot of the compensation Bain Capital has paid to Romney public information? We could probably get a good estimate on the size of the money pile he had to pay only 15% on.
Mnemosyne
@jpe:
Great, so let’s just tax the corporation when it earns income and not tax my paycheck as income when I get it from that corporation. Problem solved, right?
Well, unless you think the problem is that the poor, innocent corporation is forced to pay taxes at all, that is.
xian
@jpe: Wrong because if it’s in a corporate form then it is not your asset.