The New Yorker's endorsement of Hillary Clinton praises her for planning to "increase the tax rate on short-term capital gains for high earners, with lower rates for longer-term holdings." Why wasn't the New Yorker convinced by its own article against this plan?Here's the editorial endorsing Hillary Clinton. This is all there is on the topic, with the proposal lumped together with a handful of things:
Clinton’s tax plans are also designed to promote broader-based affluence. She would increase the tax rate on short-term capital gains for high earners, with lower rates for longer-term holdings; close the “carried-interest” tax loophole that favors hedge-fund managers; and levy fees on banks with high debt levels....Here's the James Surowiecki article — published by The New Yorker in August 2015 — "The Short-Termism Myth":
The political appeal of [Hillary Clinton's] plan is clear. It targets wealthy investors, is friendly to executives, and is aimed at getting companies to spend more money. Unfortunately, it almost certainly won’t work. The simplest reason for this is that the plan would affect only a small slice of the market. Len Burman, a tax expert at the Urban Institute, told me, “The plan’s unlikely to have a major impact on stock prices, since most of the money in the market is controlled by institutions that don’t pay capital-gains taxes, like endowments and pension funds.” Burman also made the point that pushing people to hold stocks they would rather sell is hardly conducive to productive investment. “Even if short-termism is the problem, locking people into unprofitable transactions for long periods of time doesn’t really seem like a great solution,” he said.I'm just putting this problem out there, not expressing an opinion. Who am I to disagree with "assumptions... widely shared and long-standing, in both business and academe"?
Aside from these practical problems, the plan rests on two common but ultimately questionable assumptions. The first is that corporate decision-makers care only about the short term. The second is that it’s the stock market that makes them think this way. These assumptions are widely shared and long-standing, in both business and academe...