Our Committee to Unleash Prosperity analysis of the Biden soak the rich tax plan finds that tax rates on investment income - such as stock gains - could rise to the preposterous level of more than 80% on millionaire investors.
The Biden soak the rich plan would:
Raise the small business tax rate to 39.6%
Raise the corporate tax rate to 28%
Nearly double the capital gains rate to 44.6%
Impose a first-ever tax on unrealized capital gains
Tax gains due solely to Biden inflation
The combination of all these taxes, plus state taxes on income and dividends could mean that the government would snatch away $4 out $5 of gains made on investments of more than $1 million.
What rich person would put money at risk in a new enterprise - which might easily fail - with tax penalties this high. The rich would be better off buying a yacht and sailing away.
2) Federal Court Blocks Berkeley's Gas Appliance Ban
Some more cheerful California energy news.
A Ninth Circuit panel ruled 3-0 that Berkeley's ban on natural gas connections for appliances runs afoul of federal pre-emption under the Energy Policy and Conservation Act:
3) California Introduces the First-ever Graduated Tax on Utility Bills
Traditionally, utility bills are based on the “user pays“ concept. If you use twice as much electric power as your neighbor, you pay twice as much. But last year California's legislature passed a law that adds a de facto income tax to the state's electric bills.
The new fee would be $15 a month for lower income ratepayers, while upper income ratepayers earning more than $180,000 a year would be socked with a new charge of $85 a month, or about $1,000 a year. The California Public Utilities Commission is expected to approve the measure in coming months. California already has the highest income taxes in the world.
Of course, California wouldn’t have to be raising rates for anyone, and there wouldn’t be continuing risks of blackout on the left coast, if the state would simply produce its own abundant energy.
4) School Choice: State Funding Is Only Half the Battle
Yes, we are making great progress with five states adopting education freedom policies, but Jeff Yass of Susquehanna Capital makes a key point in the WSJ. Vouchers and education savings accounts are great, but the amount should be twice as large given how much the public schools spend not to educate kids:
5) Democrats’ Senate Majority Strategy: Shoot the Wounded
California Senator Dianne Feinstein has announced she is retiring next year when she will be 90 years old. But she remains on the Judiciary Committee, and has been absent for over six weeks recovering from shingles.
Her absence means Democrats on the committee lack a majority to advance President Biden’s court nominees to the floor for a final vote. So this month they launched a behind-the-scenes campaign to get her to quit. Former Speaker Nancy Pelosi indicated she found the effort unseemly in its sexism, noting there had been no such pressure for hospitalized Senator John Fetterman to leave.
After Rep. Ro Khanna, the leading progressive in the California House delegation, called for her resignation other Democrats jumped on board. Within hours Feinstein asked to be temporarily replaced in her duties on Judiciary.
But that can only happen if Republicans go along with the gambit, which they shouldn’t. Changes in committee assignments require either unanimous consent or the vote of 60 Senators.
Sen. Tom Cotton of Arkansas, who sits on Senate Judiciary, is having none of it. "Republicans should not assist Democrats in confirming Joe Biden's most radical nominees to the courts," he says. California voters knew of Feinstein’s age issues when they re-elected her.
It will be interesting to see what pressure Senate Democrats bring on their Republican colleagues to bail them out.
As The Federalist notes: “The Democrats put an 89-year-old woman and an emotionally and mentally traumatized man into the U.S. Senate in the name of pure power politics.” They made their bed. Now they must sleep in it.
