The rich just get richer

The long-term capital gains tax is investor welfare.

Any person who made $10 million this year by his or her actual labor — a writer, an athlete, a businessperson, etc. — would pay 39.6 percent in federal tax, or $3.96 million. A billionaire who earned $10 million on long-term capital gains would pay 20 percent in federal taxes, $1.96 million less. Why?

A conservative tried to convince me that this tax break was necessary to encourage rich people to invest. I had to laugh. This tax break for the rich has cost the U.S. Treasury trillions of dollars. The rich get richer, while the income gap and the federal deficit grow.

Of course, with a Republican-controlled Congress, the capital gains tax will not be touched; I doubt that it will even be discussed. They will cure their budget problems by placing a bigger burden on the middle class and working poor.

Because of the current capital gains tax, the coddled few who make millions by sitting on their butts pay an effective tax rate that is much lower than the poor stiff who must work his butt off just to put groceries on the table.

This story was originally published December 14, 2017 at 7:19 PM with the headline "The rich just get richer."