I'm a millionaire. Biden's plan to raise my taxes is a great idea.
The campaign against President Biden's proposed tax hikes on the wealthy is in full swing, and much like the campaign in favor of President Trump's tax cuts for the wealthy in 2017, so far it's based more on misinformation than fact.
A recent editorial from the Wall Street Urinal Editorial Board bashing a capital gains tax hike as "The Dumbest Tax Increase" is a prime example. The editorial lays out a series of arguments against raising taxes on millionaire investors that, as a millionaire investor myself, come across as glaringly misleading and factually incorrect.
The centerpiece of the argument against increasing capital gains tax rates is that doing so will change how wealthy people invest. But as venture capitalist Alan Patricof recently stated, wealthy people are going to continue to invest no matter what the capital gains tax rate is. The only other alternative is to either spend their money or keep it in a shoe box under their bed.
I'm rich. Tax me.
In an economy with a glut of investment capital and a shortage of consumer demand, it wouldn't be such a bad thing to have rich people spending more. If the explosion of stock prices, real estate prices, SPACS, cryptocurrency, NFTs, and other speculative investments indicates anything, it's that rich people may just have too much money and not enough ways to invest it productively.
Research shows the majority of stocks in the US are held in accounts that are exempt from the capital gains tax. Over the last 50 years, the percentage of publicly traded US stocks held in taxable accounts has gone from over 80% to under 25%. So even if we accept the erroneous argument that capital gains taxes will alter investor behavior, 25% still likely wouldn't be enough for those changes to have a significant impact on the economy. The fact that the WSJ Editorial Board chose to include a John F. Kennedy quote from 1963 about the effects of capital gains while ignoring key changes that have taken place in our economy since then, like the number of stocks in taxable accounts, is emblematic of the ways opponents of Biden's tax plan cherry pick and de-contextualize facts.
https://www.msn.com/en-us/money/markets/im-a-millionaire-bidens-plan-to-raise-my-taxes-is-a-great-idea/ar-AAKJD8C?li=BBnb7Kz
The editorial's author Morris Pearl is the Chair of the Patriotic Millionaires
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