I honestly didn’t know whether to laugh or cry at David Sirota and Andrew Perez’s piece in Jacobin, complaining that Democrats’ arguments about taxation sound a lot like Republicans’:
For years, Democratic lawmakers fought the GOP lie that cast estate tax cuts for billionaires as efforts to rescue family farms. But in this new era of ubiquitous misinformation, the same Democrats are waving a white flag in the battle against anti-tax bullshit. They are ripping a page out of the GOP’s “death tax†playbook and conjuring a new lie, this one depicting tax breaks for affluent donors as a defense of working-class homeowners.
They then lurch uncontrollably onto a reality which, if they did not realize it before, is tragic and, if they did realize it before, is comic:
In the process, Democratic leaders show they fight far harder for the donor class than they do for the working class.
Yep. Democratic politicians and, particularly, the Democratic leadership are focused, as Bill Clinton used to say, like a laser on their donors and those donors, unsusprisingly, aren’t the poor, the downtrodden, or minorities. The rest of the article continues on in this vein.
But who are these donors? If you look at the largest organizational donors listed by Open Secrets, you can discern a sort of pattern. After several organizations controlled by big money individuals (Bloomberg, Soros—Fund for Policy Reform, Dustin Moskovits—Asana, and Tom Steyer—Fahr LLC), they are public employees’ unions (SEIU, American Federation of Teachers, AFSCME, etc.) and trade unions (Carpenters & Joiners Union, Laborers Union, Operating Engineers Union, etc.). Keep that in mind as you consider the policy proposals being advanced by the Biden Administration.
BTW only 14 U. S. representatives and senators receive 50% or more of their political contributions from small donors—8 Democrats and 6 Republicans. Most of those are fringe politicians—”democratic socialists” or ultra-conservatives. And the total amounts they’ve raised are pittances compared to some of the pols raising really big money.
The donor class will be hurt more by the increase in the capital gains tax than they will benefit by the changes to the state tax exemption. The exemption was one that was intended to hurt blue states so this is just reversing that. Anyway, if they are focused like a laser on the donor class explains the capital gains tax.
Steve
How is the motive for the cap on state and local taxes relevant? As to the capital gains tax something I learned long ago is that marginal rates are less important than how income is calculated. We’ll need to see the form that the actual legislation takes and what is included or exempt.
I guess I can only speak from personal experience, but calculation of tax basis and gain has always been pretty straightforward. I can only think of a couple thorny issues in my experience. One was when one of our factories burned down. The issue revolved around the insurance settlement vs the GAAP tax basis, and a corporate vs LLC structure.
Lest people think business types always get the benefit, the ultimate professional opinion was adverse to the notion of rebuilding the factory. The Feds had to get their tax $. No new factory. The people employed lost their jobs. Congratulations, government. Worries about income inequality my ass………