Kristof, Taxes and Billionaires
7th July 2011
Mr. Kristof doesn’t explain why labor should be taxed higher than capital — in fact just few paragraphs earlier he was arguing that it was wrong for tycoons to be taxed at a lower rate than personal trainers or chauffeurs. It’s hard enough in this economy to get people to take entrepreneurial risks to create jobs and growth; I don’t see the wisdom in moving to reduce the rewards available to entrepreneurs. I suppose there’s a certain logic to the Reagan-era rates that set capital gains and ordinary income rates at the same levels. Then labor and capital are taxed the same. As for Mr. Kristof’s reference to the “low capital gains rate,” it’s worth remembering that quite a few of America’s international competitors — Hong Kong, Singapore, Switzerland — have capital gains tax rates of 0%. Compared to that, America’s 15% rate isn’t “low,” it’s high.
Everybody has a bright idea for how much tax — usually more — the Other Fellow ought to pay.