 So Biden has a pretty ambitious economic agenda. It includes the introduction of a vast number of new social programs, probably the biggest expansion in number of programs, not necessarily in dollars, but in number of programs since the Great Society, since LBJ. We're talking about expansion of leave for new mothers and fathers, so time off from work. We're talking about childcare for government subsidized childcare. We're talking about expansions of all kinds of programs. Mostly, as always, targeted to the middle class, because those are the most popular. These are not there to help the poor. They're to help the middle class, and these are there to buy votes. And of course, all of these are very popular because the middle class is the largest body in the economy, and they love this because they're going to get free money. Of course, if you ask them how much they're willing to pay for it in terms of increased taxes, they all say, oh, no. If I have to pay for it, it's not free anymore. I don't want it. So they reject it when the cost-benefit analysis is presented to them. But of course, Biden has said that he is not going to tax anybody making over, I think, $440,000 a year. So he's only going to tax the so-called rich. And as always, as every president has said, we're not going to increase taxes on the middle class. And indeed, most of the tax plans of the last 30, 40 years have basically reduced the number of people paying taxes and steepened the curve in terms of how much different groups pay. Indeed, if you just look at income tax, and maybe that's not fair, but if you just look at income tax, the United States has the most progressive tax system in the Western world. Much more progressive in terms of the rich, so-called rich, pay a much higher percentage of all income taxes than in any other country, much higher than in Scandinavia, much higher than in Sweden, in other places. Now, if you include all taxes, then the percentage that the wealthy pay drops, but it's still significantly higher. And Bessford Fank says, flatten the curve. Yes, I'd like this. Flatten the tax curve. That would be good. So he's got a very ambitious plan. It was originally $3.5 trillion. And that's on top of a so-called infrastructure bill that's also close to $1 trillion, which is a lot of significant increase in the deficit would represent a significant increase in government debt and a significant increase in just the role of government in the economy and the growth of government in the economy. So this is big stuff, important stuff, right? Whoops, what did I do? So they had this $3.5 trillion budget plan with all these social programs are going to be expanded. And then we have the infrastructure plan. And one of the things that Biden has promised, and some Democrats, centrist Democrats, ones who don't believe in modern monetary theory, have promised is that they're going to pay for all this, that they're going to pay for it with tax increases, tax increases on the rich. And originally, they proposed increasing, oh, Larry, thank you, really appreciate that. That's very generous of you. Originally, they proposed increasing corporate taxes, not quite to the levels before Trump decreased them, but still increasing them, and increasing the top marginal income tax rate. And Senate to Cinema from Arizona said, no, not a good idea. I don't think we benefit if we increase these taxes. Nothing good will come of that. And of course, in the Senate, they need every single Democrat to vote for the bill, because no Republicans will. And then it'll be 50, and they can get over the 50 Republicans with the vice president voting 51 to 50. So they need every single Senate. And she said, no, I'm not going to do it. And then Manchin, and by the way, there were other centrist Democratic senators who said, no, but they didn't make it public, because they let Cinema take the heat. Why should they intervene? Why should they say anything? Let one Senate to take the heat. She took the heat. And then Manchin said, 3.5 trillion, you guys have got to be kidding. I will never be re-elected in West Virginia if I vote for this. Remember, West Virginia went for Trump by 20 or 30 percentage points? So West Virginia should not have a Democratic senator. So Manchin realizes this. He has to play to a much more conservative, a supposedly Republican base. So he's saying, I'm not going to vote for 3.5 trillion. So he's seeing Biden's agenda shrink from 3.5 now to something like 1.5 trillion, maybe 2 trillion, depending on how you count it. And of course, corporate tax is off the table. So the United States will continue to have a 21% corporate tax rate, which is fantastic news. And by the way, unfortunately, also good news for the IRS. It turns out that because the corporate tax rate is lower, the IRS is generating a lot more money since this is Lafacov. This is the idea that when you lower the tax rate, people actually pay more taxes, not fewer taxes. They declare more, they're more incentivized to make the money. But anyway, this year will probably be a record year in terms of corporate tax collection. And that's off the table. The personal income tax, increased personal income tax rate is off the table. Democrats just don't know what to do. The agenda is shrunk, and their tax agenda is completely out the window. But they still need to raise the revenue. Even for 1.5 trillion, they have to raise the revenue with a 2 trillion, whatever the deal will ultimately be. So they have floated the idea of what's called what they're calling a billionaire's tax. Now, this is a bizarre tax. It's a kind of a tax that no country in the Western world has ever, as far as I know, no country in the world has ever put a tax like this together. It's a real piece of work. It's a particularly disgusting tax. It's economically unbelievably destructive. It's a tax motivated by envy and nothing else. Nobody, even in Sweden, Denmark, the so-called redistributive countries of Europe, or France, for example, would think of a tax like this. The idea is to tax anybody who has wealth over a billion dollars, over a billion dollars, on their capital gains, on their capital gains. But we already tax capital gains. We tax today capital gains when it is realized, that is, let's say I buy a stock of $10, and a year later, I got really lucky, and I sell it for $20. The $10 that I made, that gets taxed. But let's say I bought a stock for $10. I sell half of it next year for $20, right? I only pay the capital gains taxes on the part that I sold. Half of it is what's called unrealized. I've made money on that investment, but I haven't realized it. I haven't sold it. I haven't cashed out. Take Elon Musk, for example. Elon Musk founded Tesla. He still owns, I don't know, let's say 25% of Tesla. Tesla is worth, I don't know, last I sold just around numbers up a trillion dollars. Elon Musk, because he owns 25% of Tesla, is worth $250 billion. But Elon Musk has not sold, let's assume, Elon Musk has not sold any shares of Tesla. So he hasn't paid any taxes. Remember on this $250 billion? Remember that he didn't buy the shares. His basis of the shares is very, very low because he got them when the company was founded for the most part. So he has a capital gains of $250 billion, but it's not gonna pay any taxes on them until he starts selling the shares. Until he starts divesting them, selling them. And this is why people complain about billionaires, that they have so much wealth, but they pay so little taxes because they don't pay taxes on that wealth. And if the wealth grows, but they're not realizing it, they're not selling that stock, they don't pay taxes on them. And that pisses off a lot of people. So what this bill would have done is basically placed at about 25% tax on unrealized capital gains. So for example, what they would have done with Elon Musk is they would have said, okay, you got in at zero, it's now a $250 billion. We're gonna tax your $250 billion at 25%. Suddenly, Elon Musk is gonna have a tax bill of 70 plus billion dollars. Actually, the actual math turns out that Elon Musk under the proposal that the Democrats have would have had to pay $50 billion in taxes in one year in the first year of this bill. And then afterwards, only the incremental increase taxes on that, $50 billion in taxes. Now notice it would have been a tax that only 700 Americans would have paid. Not every year, just the first year. And then every year it would have been determined by how much Tesla stock would go up. The more it went up, the more it'd pay. But in the first year, you'd have to pay $50 billion. Now know that if you're the Walton's, Sam Walton's children, and you've inherited stock in Walmart worth billions and billions of dollars, and Walmart stock has not done that well since you inherited it. And maybe you've already sold some of it off and you've diversified in its in real estate and it's in all kinds of other projects and it's in all the other places. Notice that you would actually pay very little money, even though you're a billionaire, but you would have very little unrealized capital gains. So this is particularly gonna hurt the nouveau rich. It's particularly gonna hurt the owner, entrepreneur, who's built his company up and is now worth more than a billion dollars. It's particularly gonna hurt entrepreneurs, successful entrepreneurs. Now, how is Elon Musk gonna get $50 billion to pay the tax? He doesn't have $50 billion lying around. Well, he's gonna have to sell his shares. His ownership in Tesla will go down significantly. Which is not good for anybody. It's not good for corporate governance. It's not good for Tesla. It's not good for Elon Musk. And the government's gonna take it. And instead of $50 billion being, in a sense, in Tesla. And think of the price pressure when you're trying to sell 25% of the stock in a company, what that would do to the price. And now the government has it to waste on its social programs. I mean, talk about highway robbery. Talk about highway robbery for 700 people. I mean, I don't know how this is constitutional. I don't know how this is not discriminatory, disgusting, abusive, makes no economic sense. It's completely destructive economically. Every dollar you take out of a billionaire's pocket is a dollar that's not invested. It's a dollar that's not used for productive means. It's a dollar that now in a sense is working to slow economic growth, not to expand it. It's, it's not clear what happens. What happens in a year where the stock market goes down? What happens if, because maybe because Elon Musk sells $50 billion of Tesla stock. What happens if Tesla stock goes down 50%? Will the government refund Elon Musk's money? It's not clear. We haven't seen the final proposal yet. What happens for other billionaires when the stock market goes down? They paid, by the way, Jeff Bezos, another one of these evil billionaires, right? We'll have to pay $44 billion, $44 billion in taxes. Talk about confiscation, a confiscatory tax rate. It's absurd and insane. You can't tax what is not being realized. I mean, you can, and they are, and they want to. Anyway, this was on the table. Every economist I know wrote about how ridiculous this is, how pathetic it is. I mean, everybody, every good economist I know. People who pretend to be economists. I'm sure Richard Wolff thought this was fantastic. So did, I don't know about Paul Krugman. Paul Krugman, hard to tell what he would have thought of this. The whole thing was just insanity. Now, you have to give some of the senators and house members credit. Some Democrats in the house said, we can't vote for this. This is insane. It probably can't pass constitutional muster as if they care. And this is just stupid policy. And they basically vetoed it. Manchin, Mnuchin in the Senate said no. And now it's off the table. So the Democrats are back to square one. They have lots of ideas of spending money. Yeah, AOC loves it, of course. They have lots of ideas about spending money, but they promised, and some of them want to fulfill their promise surprisingly enough, they promised to also raise taxes to make it quote revenue neutral. And they can't figure that one out. So the latest proposal, latest proposal is, I'm just giving you a heads up warning, to tax the increase to have a 3% surcharge and extra tax of 3% on anybody earning more than $10 million. So instead of a billionaire tax, this is now a millionaire tax. It's only 3%, so it's significantly lower than what it was before. While this is horrible, it's probably significantly less damaging economically and certainly less stupid economically. Still evil and nasty and confiscatory and loading up the rich to pay for programs to the middle class. It's not even, you can't even use the altruism game here of oh, it's about the poor. No, these are all programs that are meant to help the middle class. So let's screw people who are incredibly successful in order to hand out free primary school education to a bunch of parents, elderly care, all kinds of stuff like that at the margins, increasing all the social programs in every direction. And of course, one thing you know, by the way, this is true of the capital gains tax, the unrealized capital gains, the idea was it was a billionaire tax. But what happens to all billionaire taxes? Do you remember the alternative minimum tax? I forget when it was passed, it was passed a long, long time ago. And the alternative minimum tax was supposed to make sure that some of the richest Americans, a small number in the thousands of rich families who weren't paying taxes because they found all kinds of loopholes, the alternative minimum tax was a way to get them to pay at least some kind of minimum. And it was just a few hundred families. Today, I think almost half of taxpayers pay the alternative minimum tax. It ensnares everybody. You know, the income tax when it was passed in 1914, constitutional amendment and Congress passed the first tax, was very low and only 7% of Americans paid income tax. That was 1914. Went into two years as President Wilson prepared us to go into the dumbest war ever, World War I, it was expanded to include almost all Americans. So never believe that a tax will stay a billionaire tax. Then it becomes a, what about the guy who makes 900 million? Well, and if he's get taxed, what about the one who makes 500 million? Well, it's worth 500 million. And hey, what about the 100 million guy? And look, why don't we just tax the whole 1%? What about the top 10%? And soon the middle class are paying taxes and unrealized capital gains. Every tax proposed where they said, oh no, only the rich will pay. There's always been expanded. And the definition of rich has always been expanded. So let me just say how thankful I am to Senator Sinema and Senator Manchin. How thankful I am to the centrist Democrats in the house. There are not a lot of them, but the ones who are for stopping these insane proposal. Yeah, this is Ron Whidon's, Whidon's, I don't know how you pronounce it, the head of the finance committee and the Senate's proposal. He's the senator. Thankful to all the senators, Democrats as they may be, who have resisted this insanity. It's nice to see that the Democratic Party is not a monolith of nutty progressives. This is still bad, but at least not a monolith of nutty progressives. Epa says, flat tax already. You're not gonna get a flat tax. There's no, nobody is incentivized to provide a flat tax. Note that Republicans stop talking about flat tax. That Trump was never for a flat tax. Republicans are not for it. Never happy. So happy to see proposal after proposal after proposal defeated. It'll be great if Biden's agenda gets killed by the infighting within the Democratic Party, just like repealing Obamacare was killed by the infighting within the Republican Party and the lack of leadership from the White House. It would be good to see the Democrats following suit. And as I've told you many, many times, my favorite balance of power in Washington is gridlock. And one of the great tragedies of the Republican of Trump was that he managed to lose the Republicans the Senate, which I thought was pretty safe for Republicans. Luckily, we still have Manchin, who's kind of a half Republican and cinema who's somewhat leans on economic issues in the right direction. This is all good. You know, the real enemy is government spending. So what I'd really like to see defeated is any spending plan that the government proposes. I think something will pass. I think Democrats will coalesce around some smaller bill and they will get it passed by the end of the year. They have to do something next year is midterms. Nothing happens in Congress during midterms because everybody's afraid. So everybody sticks the status quo. So anything Democrats want to pass is now. If you have any influence in Democratic senators or House members, encourage them not to pass anything this year. But I think they will. It'll just be a smaller, less effectual bill with smaller, less effectual taxes, less damaging taxes. All of that is for the better as compared to the alternative. Of course, none of this would be on the table. None of it. If Republicans hadn't lost the House in 2018 and hadn't lost the Senate in 2020. So you can thank Republicans for being stupid enough and pathetic enough and incompetent enough to lose both the House and the Senate and the White House, of course, in a span of two years. Two years. All right. Thank you for listening or watching The Iran Brook Show. 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