A tax on unrealized capital gains, if it passes constitutional muster, will lead to really terrible, unintended results, even if it's intended for billionaires.
I have no doubt that my perspective will not be well received by The Racketeers, but I have long found it irksome that we have only 7 marginal income tax brackets. I believe we should have many more brackets up to as much as 90-92%. In 1952, When the highest marginal income tax rate was 92%, there were 24 tax brackets with the 24th bracket being $200,000 and above for filing single and married filing separately and $300,000 and above for head of household. Adjusted for inflation the equivalent of $200k in 1952 is $2,070,264.15 today and $300k is $3,105,396.23. The Forbes 400 did not exist back then, but the Mellon family was one of the richest families at that time. Adjusted for inflation, the Mellon family fortune estimated at $1.6-2.8 billion, back then, would be the equivalent of $16,562,113,207.55-$28,983,698,113.21. I think it is ridiculous that we are dithering around with 7 tax brackets with the highest marginal income tax bracket of 37% on incomes $518,400-single, $311,025-married filing separate, $622,020 married filing jointly, and $518,400 when $622,020 in 1952 was the equivalent of $60,093.78 and the beginning bracket of 10% on head of household, $0-14,100 with the equivalent of $14,100 being $1,352.00 in 1952. It is ridiculous that people earning $622,020 are in the same tax bracket as Bezos, Musk, Gates, etc.
The tax rate on corporations in 1954 was reduced to 52% and Eisenhower was not in favor of reducing it below 47% (see transcript of his March 15, 1954 radio address). The Republican Party has rejected the egalitarian principles of the days of Eisenhower.
The GOP of the last 40-50 years has not supported the role of government that the Eisenhower Republicans did. Some of the things mentioned by Ike in his March 15, 1954 radio and television address are renounced as socialism by today's GOP.
Per Ike, "But while we are insisting upon good management and thrift in Government, we have, at the same time, asked the Congress to approve a great program to build a stronger America for all our people.
So let me give you some examples of the things we want to do in this program:
We want to improve and expand our social security program.
We want a broader and stronger system of unemployment insurance. We want more and better homes for our people. We want to do away with slums in our cities.
We want to foster a much improved health program.
We want a better and a lasting farm program, with better reclamation and conservation.
We want an improved Taft-Hartley Act to protect workers and employers.
We want wider markets overseas for our products.
We want--above all--maximum protection of freedom and a strong and growing economy--an economy free from both inflation and depression.
Most of these things cost money. Without adequate revenue, most of them would be abandoned or curtailed."
I don't have a clue what MAGA actually meant. It certainly didn't mean investing in infrastructure, education, and people in order to put the US back at the top.
Democrats are putting energy into infrastructure, healthcare, and wages (Things supported in the Eisenhower days). Republicans won't have anything to do with it. They have spent decades trying to prove to Americans that "Government is the problem," while we have fallen behind in education, technology, transportation, manufacturing.
At the beginning of this century, China had no high speed rails. Today, they have the world's largest network of high speed rails. They began construction in 2008 and now have 23,500 miles of rail line criss crossing the country and it will be doubled by 2030. China has constructed "The Iron Silk Road," which connects China to Europe.
And in the news, just recently, China blindsided us with their hypersonic missile technology. We lost our competitive edge decades ago. Our country is so bassackwards, it will take a long time to stage a come back. Eisenhower era taxes would go along way to helping us claw our way back, if ever.
This nation has sacrificed its future to the gods of corporation. China can do what it is doing because they have the manufacturing capabilities thanks to greedy American corporations. We are predominantly a service economy, established to meet greedy consumer demand from nail salons and restaurants, to retail and warehouses. Low wage jobs reign. Young people are being relegated to permanent renter class, whole, newly constructed neighborhoods are being purchased by investment groups and the homes put up for rent. It is all BS and it all seems to be whole heartedly endorsed by Republicans and numerous moderate members of the Democratic Party.
Excellent, I concur Steve. I think judging by the responses you've received, shows the ideological differences between some of your readers. I've long been a proponent of a flat income tax, or a general consumption tax, with most deductions and credits abolished(save a few to maintain Constitutional muster). I also generally favor a major retrenchment of federal entitlement programs, with the burden of responsibility for entitlements being shifted to states. If the populace in the latter want them, then it is up to these governments to raise taxes accordingly. Many Americans who favor a massive entitlement state(especially those on the hard progressive left and populist right), especially those that love to demagogue the affluent, often dream up of constitutionally dubious federal wealth taxes on the latter, as a means of funding their proposals. If this is what they want(and I don't), then they should just add higher marginal tax brackets or raise the percentages as well as the scope of the brackets. And lower to middle income Americans also should have their taxes increased in proportion to the costs of entitlements they seek to benefit from.
One of the reasons many Americans clamor for government entitlements, is that most of them do not bear the costs for such entitlements, as opposed to the more affluent. That is why they willingly vote the largess of the federal treasury, without experiencing the consequential effects of it to their pocketbooks. One of the reasons why the Nordic countries of Europe are able to sustain their welfare states quite well, is that almost everyone pays high taxes from the less affluent to the wealthy. The highest tax brackets in these countries are levied on income levels that fall well within the middle class. Increasing taxes for lower to middle income Americans as a response to proposals to expand the federal programs would allow Americans to have an honest cost-benefit analyses to whether such programs are worth the expenditure, or not.
I don't care how you do it but the country can't survive on this level of tax income and there is only one group of people who have any money left to tax. Figure it out.
Minor point Steve...Yellen's statement does seem accurate and true. If you replace the words 'escape taxation' with the words 'are not taxed', the meaning of the sentence is exactly the same, (and perhaps the meaning is clearer). In other words, Yellen is simply saying that unrealized capital gains are not taxed...the capital gains are only taxed when they are realized.
You wrote that France backed off this idea - do you know if there are any countries that have adopted it that we can examine to see how this played out?
Personally, I've very skeptical that this passes Constitutional muster, but I'd be very curious if a country like Sweden's tried something like this and we can draw some lessons that way.
I have no doubt that my perspective will not be well received by The Racketeers, but I have long found it irksome that we have only 7 marginal income tax brackets. I believe we should have many more brackets up to as much as 90-92%. In 1952, When the highest marginal income tax rate was 92%, there were 24 tax brackets with the 24th bracket being $200,000 and above for filing single and married filing separately and $300,000 and above for head of household. Adjusted for inflation the equivalent of $200k in 1952 is $2,070,264.15 today and $300k is $3,105,396.23. The Forbes 400 did not exist back then, but the Mellon family was one of the richest families at that time. Adjusted for inflation, the Mellon family fortune estimated at $1.6-2.8 billion, back then, would be the equivalent of $16,562,113,207.55-$28,983,698,113.21. I think it is ridiculous that we are dithering around with 7 tax brackets with the highest marginal income tax bracket of 37% on incomes $518,400-single, $311,025-married filing separate, $622,020 married filing jointly, and $518,400 when $622,020 in 1952 was the equivalent of $60,093.78 and the beginning bracket of 10% on head of household, $0-14,100 with the equivalent of $14,100 being $1,352.00 in 1952. It is ridiculous that people earning $622,020 are in the same tax bracket as Bezos, Musk, Gates, etc.
The tax rate on corporations in 1954 was reduced to 52% and Eisenhower was not in favor of reducing it below 47% (see transcript of his March 15, 1954 radio address). The Republican Party has rejected the egalitarian principles of the days of Eisenhower.
The GOP of the last 40-50 years has not supported the role of government that the Eisenhower Republicans did. Some of the things mentioned by Ike in his March 15, 1954 radio and television address are renounced as socialism by today's GOP.
Per Ike, "But while we are insisting upon good management and thrift in Government, we have, at the same time, asked the Congress to approve a great program to build a stronger America for all our people.
So let me give you some examples of the things we want to do in this program:
We want to improve and expand our social security program.
We want a broader and stronger system of unemployment insurance. We want more and better homes for our people. We want to do away with slums in our cities.
We want to foster a much improved health program.
We want a better and a lasting farm program, with better reclamation and conservation.
We want an improved Taft-Hartley Act to protect workers and employers.
We want wider markets overseas for our products.
We want--above all--maximum protection of freedom and a strong and growing economy--an economy free from both inflation and depression.
Most of these things cost money. Without adequate revenue, most of them would be abandoned or curtailed."
I don't have a clue what MAGA actually meant. It certainly didn't mean investing in infrastructure, education, and people in order to put the US back at the top.
Democrats are putting energy into infrastructure, healthcare, and wages (Things supported in the Eisenhower days). Republicans won't have anything to do with it. They have spent decades trying to prove to Americans that "Government is the problem," while we have fallen behind in education, technology, transportation, manufacturing.
At the beginning of this century, China had no high speed rails. Today, they have the world's largest network of high speed rails. They began construction in 2008 and now have 23,500 miles of rail line criss crossing the country and it will be doubled by 2030. China has constructed "The Iron Silk Road," which connects China to Europe.
And in the news, just recently, China blindsided us with their hypersonic missile technology. We lost our competitive edge decades ago. Our country is so bassackwards, it will take a long time to stage a come back. Eisenhower era taxes would go along way to helping us claw our way back, if ever.
This nation has sacrificed its future to the gods of corporation. China can do what it is doing because they have the manufacturing capabilities thanks to greedy American corporations. We are predominantly a service economy, established to meet greedy consumer demand from nail salons and restaurants, to retail and warehouses. Low wage jobs reign. Young people are being relegated to permanent renter class, whole, newly constructed neighborhoods are being purchased by investment groups and the homes put up for rent. It is all BS and it all seems to be whole heartedly endorsed by Republicans and numerous moderate members of the Democratic Party.
Excellent, I concur Steve. I think judging by the responses you've received, shows the ideological differences between some of your readers. I've long been a proponent of a flat income tax, or a general consumption tax, with most deductions and credits abolished(save a few to maintain Constitutional muster). I also generally favor a major retrenchment of federal entitlement programs, with the burden of responsibility for entitlements being shifted to states. If the populace in the latter want them, then it is up to these governments to raise taxes accordingly. Many Americans who favor a massive entitlement state(especially those on the hard progressive left and populist right), especially those that love to demagogue the affluent, often dream up of constitutionally dubious federal wealth taxes on the latter, as a means of funding their proposals. If this is what they want(and I don't), then they should just add higher marginal tax brackets or raise the percentages as well as the scope of the brackets. And lower to middle income Americans also should have their taxes increased in proportion to the costs of entitlements they seek to benefit from.
One of the reasons many Americans clamor for government entitlements, is that most of them do not bear the costs for such entitlements, as opposed to the more affluent. That is why they willingly vote the largess of the federal treasury, without experiencing the consequential effects of it to their pocketbooks. One of the reasons why the Nordic countries of Europe are able to sustain their welfare states quite well, is that almost everyone pays high taxes from the less affluent to the wealthy. The highest tax brackets in these countries are levied on income levels that fall well within the middle class. Increasing taxes for lower to middle income Americans as a response to proposals to expand the federal programs would allow Americans to have an honest cost-benefit analyses to whether such programs are worth the expenditure, or not.
I don't care how you do it but the country can't survive on this level of tax income and there is only one group of people who have any money left to tax. Figure it out.
Minor point Steve...Yellen's statement does seem accurate and true. If you replace the words 'escape taxation' with the words 'are not taxed', the meaning of the sentence is exactly the same, (and perhaps the meaning is clearer). In other words, Yellen is simply saying that unrealized capital gains are not taxed...the capital gains are only taxed when they are realized.
You wrote that France backed off this idea - do you know if there are any countries that have adopted it that we can examine to see how this played out?
Personally, I've very skeptical that this passes Constitutional muster, but I'd be very curious if a country like Sweden's tried something like this and we can draw some lessons that way.