Time for the progressive capital gains tax / by kevin murray

Although we read in Holy Scripture, "For you always have the poor with you…" (John 12: 8) --so too, is it quite apparent that we also always have the rich; and those privileged people in today's world are outrageously rich.  So that, as reported by forbes.com, in America, three people, "…collectively hold more wealth than the bottom 50% of the domestic population." 


Most Americans have to labor for their money, that is to say, they go to work and are paid an agreed upon hourly or salary wage, and have deducted from their paycheck, Social Security taxes, Medicare taxes, Federal taxes, and in most States of this union, State taxes.   So then, those that work and labor for a living pay their taxes as required per the progressive tax system each year.  On the other hand, the very rich, though they may also labor for their wages, typically, make a significant amount of their money, not from that hourly or salary wage, but actually from capital gains, such as stock appreciation, or real estate appreciation, in which those long-term capital gains are taxed at a lower rate than those that are subject to the progressive income tax.


That is to say, the highest progressive income tax rate as of 2018 is 37%, whereas the highest capital gains tax rate is essentially 20% for long-term capital gains.  The fundamental difference between those that labor for their wages, in which they are required to work in order to make a living as opposed to all those that augment that income with capital gains or substantially make all of their money through capital gains is that the former is actually making their money by the sweat of their brow to get their daily bread, whereas the latter is for the most part, utilizing money to make additional money, without typically have to sweat for it, and already for the most part, have their daily bread and so much more.


Those that have large capital gains are the richest people in America, yet, those rich people effectively pay lower taxes than all those that are simply trying to make ends meet.  The whole point of a progressive tax system was not that it would be setup just to capture wage income but that such a progressive tax system would capture all income that a given individual makes.  However, this progressive tax system has morphed itself into being manipulated by the richest and most powerful Americans so that they will keep more, and the downtrodden will have less.


If this country truly believes in the progressive tax system, then it needs to address the inequalities created within that tax structure, and specifically should make it their point to progressively tax at a higher progressive rate, all those that make more income, whether that be by wage labor, dividends, capital gains, or a combination of those very things.    If, on the other hand, this country believes that it is right and good that just three individuals own more wealth then the bottom 50% of its own citizens, then certainly, don't change a thing, because the rich are getting so much richer, and the poor are getting so much poorer, and therefore we will always have the poor amongst us.