A Bad Bill That Will Raise Taxes
By Bluey Posted in Congress | Featured Stories — Comments (5) / Email this page » / Leave a comment »
Senators Max Baucus (D.-Mont.) and Charles Grassley (R.-Iowa) have apparently lost faith in the free market. The Finance Committee duo last week introduced a bill that would impose new taxes on publicly traded partnerships. Their move appears timed to coincide with the upcoming initial-public offering (IPO) of the Blackstone Group.
The Baucus-Grassley bill has prompted outrage among conservative and free-market groups. It inspired the American Conservative Union to issue an action alert today calling for the bill's defeat. The ACU move could be followed by others tomorrow. The ACU alert put it this way:
The free market community is united against any new tax increases and will oppose this bill vigorously. Not only is this legislation a major tax increase, it will actually depress tax revenues as other partnerships will choose to stay private or reincorporate abroad -- neither of which is good for the economy, the government or investors.
More on the jump ...
One Wall Street blog, DealBreaker, called the bill "a huge expense that may chill the desire of firms to go sell equity to the general public." Larry Kudlow had tough words for Baucus and Grassley and the New York Sun editorial page called it a tax on "one person [who] is making too much money." That man would be Stephen Schwarzman.
The whole situation smells fishy and it's alarming that Grassley would go along with it. But the biggest fear is that the bill could sneak through the Senate with conservatives focused on defeating a bad energy bill, immigration bill and card-check bill. Fortunately, because the Baucus-Grassley bill hasn't even had congressional hearings or been scrutinized by the Treasury or IRS, there's hope it'll get slowed down while we educate senators.
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A Bad Bill That Will Raise Taxes 5 Comments (0 topical, 5 editorial, 0 hidden) Post a comment »
...is the Government's need for money. One thing that never changes; that politicians are Charlatans. They'll try to tell you that none of the electorate will feel this, it's only the super rich they are targeting. They should be required to dress as snake oil salesman when they go on camera, because in reality, that's what they are.
Take for example, the slight of hand of the Connecticut State Legislature's fifteen per cent additional tax on Northeast Utilities. The ink hadn't even dried on the bill before NU raised it's rates a blanket fifteen per cent the next day, with full government regulatory approval. The end result was the clueless electorate grumbling about the "dirty rotten utility" raising its rates on them again for the umpteenth time, the Democratic legislators milking their cash cow for their pet pork spending projects with nobody laying a PR finger on them, or truthfully blaming them for indirectly forcing NU to raise it's rates. Meanwhile the local CBS affiliate does an afternoon news hit piece on Jerry Falwell while the undertaker was still in the process of just finishing embalming his body.
As an investor, I increasingly worry about the flood of capital heading toward private markets at the expense of public ones (primarily due, of course, to the excessive regulation of Sarbanes-Oxley). IPOs such as Blackstone's would allow everyday investors such as myself to have access to these private markets - access that we would normally be shut out of unless we had an extra $10 million lying around.
What Grassley and Baucus are proposing will not net any additional revenue for the treasury, and will only discourage private firms such as Blackstone from offering investment opportunities to the public. As a result, these firms will continue generating large returns, but the general public will not be able to share in those returns.
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The truth is, the more you tax profits, the more you undermine the American work ethic and the incentive structure that goes along with it. In fact, you demoralize the very system that has made this country great.
taxes is worse, yet mouth watering to liberals. In due time we may expect this tax to be returned to it's confiscatory, previous levels.
"a man's admiration for absolute government is proportinate to the contempt he feels for those around him". Tocqueville
Raise taxes, fund socialism and gun control. They never fail to follow the script.
Fortunately, because the Baucus-Grassley bill hasn't even had congressional hearings or been scrutinized by the Treasury or IRS, there's hope it'll get slowed down while we educate senators.
It's so difficult to stop some people from doing something completely stupid and anti-market whenever we're not watching. Thanks, Bluey, for posting this, because it's a real "gem" of a "piece" of legislation that has a lot of danger of actually passing because most people aren't paying attention.
And people claim that plasma fusion is impossible to achieve. What's really more impossible is stopping people who can't resist the knee-jerk impulse to into nonexistance people who know how to make money and want to help other people to make money.