Kevin Williamson writes, “You know who was a fan of taxing capital gains at the same rate as ordinary income? The Reagan administration. Not a bad idea.”
The Reagan administration’s tax-reform proposal did not tax capital gains and ordinary income at the same rate; it cut capital-gains taxes, doubtless on the theory that any capital-gains tax constitutes a bias against saving and investment. Senator Packwood brought the cap-gains rate up, apparently in order to preserve tax breaks for timber and employer-provided health insurance.