Monday, November 21, 2011

Capital Gains Taxes: The Worst Thing In The World.

That's what we are often told. If only those poor capital gains were not taxed so harshly (!), all investors would let their money flock here! The "job-creators" (shorthand for very very rich people) suffer because of that fifteen percent tax on long-term capital gains! It's an economic imperative to stop taxing capital gains!

So say several Republican presidential candidates, including Herman Cain and Rick Perry:
Two Republican presidential candidates, Herman Cain and Rick Perry, have proposed tax reform proposals to stimulate the economy and spur job growth. Both proposals share many desirable attributes, such as simplifying the complex tax code, lowering the corporate tax rate to become globally competitive again, eliminating the death tax and capital gains tax to increase capital mobility, eliminating taxes on repatriated foreign earnings of U.S. multinational companies so they make investments at home, and maintaining revenue neutrality so the tax cuts will not add to the federal budget deficits.
Bolds are mine, the biased writing is by the link I quote.

Huntsman would also eliminate capital gains taxes for all, Romney only for middle class tax-payers. Obama would eliminate this tax for "small businesses."

Why am I writing about something so boring? Because of this:
The top 0.1%–  about 315,000 individuals out of 315 million–  are making about half of all capital gains on the sale of shares or property after 1 year; and these capital gains make up 60% of the income made by the Forbes 400.
Assuming these numbers are true, what would be the impact of zero capital gains taxes on economic inequality in the United States? The richest of the very rich would pay zero taxes on 60% of their income!

It's like looking at the hairy underbelly of the Republican ideology, it is. Those Republican presidential candidates are openly asking the extremely rich to be released from income taxes, and the Republican commentators think that is an excellent idea.