This is a transcript from my radio show. You can subscribe to my premium newsletter for $7/month or $70/year. I'm going to delve into a very, very boring topic and I'm going to try to make it interesting, educational and titillating so you don't fall asleep. We need to talk about tax law.
A tax on unrealized capital gains is, in addition an unconstitutional direct tax on an asset, is based on the logical fallacy,that assets held by a person will at worst retain its value indefinitely. Imagine if that tax had existed in 2000, and people holding stock in Enron had been required to pay such a tax based on the unrealized capital gains on the stock right before the accounting acandal which dropped the value of a share in the company from $90/share to mere pennies. Enron shareholders would have had to sell other productive assets and perhaps empty cash savings to raise the funds to pay the tax, thus essentially destroying, or at least severely depleting, their net worths. The result would have been a further concentration of wealth in the hands of a precious few super rich who could manage to pay such a tax and still retain the core of their fortunes. This is exactly what happened in the 1930s; when people were forced to liquify assets due to the Depression, others, who could afford to lost 50% or more of their net worth, simplt snapped up the shares of perfectly good companies at fire sale prices. When the market recovered after WWII, a massive concentration of wealth was effectively complete.
This is a proposal which, among other things, completly violated the Law of Unintended Consequences. It would do precisely the oipposite of what it's being sold as doing, a fact which I suspect might just be colpletely intended by Congressional Democrats as a reward to their 1/10th of 1% donors. Long live crony capitalism in the United Socialist States of America!
"...and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed." Few things in this country more exemplify this passage from the Declaration of Independence than taxes. The litany of graft and corruption that taxation has funded is maddening, yet it's never enough, is it? How can thinking individuals call for MORE taxes when our government behaves like a 21 year-old Powerball winner?? And now the effort is to tax unrealized gains. How long before we're taxed for DREAMING of one day being wealthy? "Let me tell you how it will be (taxman) / it's one for you nineteen for me (taxman)"
A tax on unrealized capital gains is, in addition an unconstitutional direct tax on an asset, is based on the logical fallacy,that assets held by a person will at worst retain its value indefinitely. Imagine if that tax had existed in 2000, and people holding stock in Enron had been required to pay such a tax based on the unrealized capital gains on the stock right before the accounting acandal which dropped the value of a share in the company from $90/share to mere pennies. Enron shareholders would have had to sell other productive assets and perhaps empty cash savings to raise the funds to pay the tax, thus essentially destroying, or at least severely depleting, their net worths. The result would have been a further concentration of wealth in the hands of a precious few super rich who could manage to pay such a tax and still retain the core of their fortunes. This is exactly what happened in the 1930s; when people were forced to liquify assets due to the Depression, others, who could afford to lost 50% or more of their net worth, simplt snapped up the shares of perfectly good companies at fire sale prices. When the market recovered after WWII, a massive concentration of wealth was effectively complete.
This is a proposal which, among other things, completly violated the Law of Unintended Consequences. It would do precisely the oipposite of what it's being sold as doing, a fact which I suspect might just be colpletely intended by Congressional Democrats as a reward to their 1/10th of 1% donors. Long live crony capitalism in the United Socialist States of America!
A very helpful read. Thank you!
"...and accordingly all experience hath shewn, that mankind are more disposed to suffer, while evils are sufferable, than to right themselves by abolishing the forms to which they are accustomed." Few things in this country more exemplify this passage from the Declaration of Independence than taxes. The litany of graft and corruption that taxation has funded is maddening, yet it's never enough, is it? How can thinking individuals call for MORE taxes when our government behaves like a 21 year-old Powerball winner?? And now the effort is to tax unrealized gains. How long before we're taxed for DREAMING of one day being wealthy? "Let me tell you how it will be (taxman) / it's one for you nineteen for me (taxman)"
Fascinating! I didn't know that...one of the reasons I subscribe is the education I get from you!