After Senator Obama let it be known that he'd consider nearly doubling to 28% the current capital gains tax rate of 15%, he had to expect questions. In the Pennsylvania debate, the moderator pointedly asked Mr. Obama why he'd do this, since history has shown that higher rates bring less revenue. Mr. Obama's response was to take a shot at wealthy hedge fund managers.Very interesting, eh? I suppose this isn't quite what we should call a "flip-flop." I do think it presents a curious change in his views over a relatively short period of time. I wonder which of the views he has publicly expressed about this tax rate he actually believes? Perhaps the Senator doesn't actually have a view about the capital gains tax rate? Perhaps he chooses his campaign rhetoric in light of his analysis that voters are rationally ignorant?
Since then, he's done some homework on capital gains. In a weekend interview with Chris Wallace of Fox News Sunday, Mr. Obama was asked again about raising capital gains rates. Though still leaving open the chance of a higher rate, he suggested 'we might go back up to 20' (a number Hillary Clinton has proposed), because 'I'm mindful that we've got to keep our capital gains tax to a point where we can actually get more revenue.' Mark this down as economic progress.
Wednesday, April 30, 2008
A WALL STREET JOURNAL commentary notes Senator Obama has revised his views concerning increasing the capital gains tax rate: