April 27, 2021

"To be sure, we don’t have access to the counterfactual world in which capital-gains tax rates sat at 40 percent over the past four decades."

"It is theoretically possible that growth would have been lower under such a scenario. But even in the most generous assessment, the impact of low capital-gains tax rates on economic growth is unclear. What’s more, the actual policy being debated here is not what the capital-gains tax rate should be, but rather, whether it is worthwhile to raise the capital-gains rate in order to invest in universal prekindergarten, public child care, a child allowance, free community college, and paid family and medical leave." 

From "Rich Investors Make a Poor Case Against Biden’s Tax Plan" (NY Magazine). 

There was some concern expressed yesterday over the "remarkable slackening" in population growth seen in the 2020 census. What will it do to the economy going forward if Americans don't maintain the long human tradition of robust reproduction? I was inclined to say, don't worry about it, less population growth is good for the environment. 

But if you took the other side of that debate — and plenty of readers emailed to instruct me on the need for newly bred Americans to maintain our economic well-being — you'd better worry about women declining the option to undertake childbearing and men and women passing on the potentially fulfilling endeavor of child-rearing. It's terribly expensive! But people are supposed to plunge into it as part of the love-struck romance of youth. Damn the financial incentives. But, oh!, rich folk need plenty of incentives to keep investing. 

Sorry, rich folk coddlers, you're going to have to incentivize reproduction a little bit. The old scheme of locking women into childbirth as a consequence of indulging in sex failed long ago, and you sound like a fool talking about it now, especially if you attempt to stand on the foundation of love for babies, when what you are doing is justifying freeing rich folk — people who make over $1 million a year — from paying a 40% capital gains tax. Can't dishearten them in their enthusiasm for investing? What about the young people who are disheartened about having children? Worry about them.

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