I was just watching David Brancaccio on NOW discussing with a guest how it would be desirable to encourage shareholders to take a longterm perspective. What was Mr. Brancaccio's proposal? Eliminate capital gains tax on shares held for more than ten years. What a fantastic idea!!! Why should anyone expect Bill Gates to pay the same tax rate as someone who cleans toilets for a living or puts out fires. After all, Bill Gates sits on share of Microsoft -- much more important work. Of course, if David Brancaccio is smart enough to breath (something that he seemed to be doing), he knows that we could also provide incentives for longterm holdings of stock by taxing short-term holding. In fact, this is exactly what they do in communist England. England imposes a tax of 1.0 percent on every stock sale (0.5 percent paid by the seller and 0.5 percent paid by the seller). This discourages frequent trading without allowing the richest people in the country to get away without paying any taxes. I don't mind David Brancaccio saying stupid things, but it does piss me off that he does it on PBS. I really don't like paying my tax dollars for such nonsense. Where is Newt Gingrich when we need him?
--Dean Baker
