5/26/21
Yours truly has long suspected that the Democrats, and not a
few Republicans, don’t like people making money without their blessing. Furthermore, the Democrats and their fellow
travelers in the Republican Party especially seem to despise people who not
only have made money but have managed to resist the temptation to spend with the
utter silliness that characterizes so much of American society and put a few
dollars away. Why else would the
Democrats try to remove whatever incentives exist for people to make money, save
some of the money, invest that money, and hence help build a strong
economy?
The Biden administration designs on the capital gains tax
are merely the latest manifestation of this ultimately self-destructive
Democratic infatuation with sticking it to people who are successful. They have to know that they will raise
little or no revenue by increasing the capital gains tax, so why do it? I suspect it is part of a larger plan to get
“the rich,” this time for real.
What the Democrats and more than a few Republicans don’t
understand is that, in order for a free-market system to work, some people have
to make a lot of money. Inevitably,
they, we, and most people won’t like a lot of the people who will get rich in a
free market system; after all, in some, but not as many as some suppose, cases,
many of the qualities that serve to make a person rich are not the same
qualities that endow them with a high degree of likeability. Even yours truly finds many of the “rich” to
be silly and shallow, people with whom I am glad I don’t have to spend any
time. But what you or I think of certain
people has no bearing on their ability to make things and/or provide that
people want to buy. Fortunately, our
system of free enterprise does not demand that its participants be genuine
humanitarians or even pleasant people; if it did, we’d be a much less rich
society.
Of course, there is an element in the Democratic Party that
would prefer to ditch the free enterprise system altogether, and one suspects
that if there were a few votes in it, there would be more than a few GOPers who
would go along with such imbecility.
But that is another issue.
I wrote this letter on the capital gains tax to the Wall
Street Journal on April 26; it was published on May 3:
4/26/21
Both Larry Lindsey (“Biden Taxes for Punishment’s Sake,”
Opinion, 4/26/21) and the Journal editorial writers (“The Dumbest Tax
Increase,” Review and Outlook, 4/26/21) make the point that the proposed Biden
capital gains tax increase will, in all likelihood, reduce revenue. Both articles conclude that one of Mr.
Biden’s motives in proposing the increase is to punish those who save and
invest.
One does not have to give the Biden economic and
political brain trust too much credit, however, to propose another motive for
proposing this seemingly pointless and economically destructive tax
increase. When it becomes apparent
that the tax increase is actually reducing revenue, the Biden team will present
this outcome as an argument for taxing unrealized capital gains, long a goal of
the Democratic left. Since the “rich”
will be able to “escape” this “fair” level of taxation by exploiting
“loopholes” (i.e., not selling their stocks), the “just goals” of the tax must
be met by eliminating this “loophole” by taxing unrealized gains.
One might argue that denizens of the Democrat left don’t
fully grasp economics, but one could never argue that they don’t know their
politics.
Mark M. Quinn
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