“Why, then, do you seem to feel guilty about it?” I don’t feel guilty about being given all these tax breaks. I didn’t lobby anyone for them. It’s just hard for me to figure why ordinary working people feel like they should pay more taxes so that the rich can pay less.
“Why do you feel that investment income is ‘unearned income’”?
Aha! You are revealing yourself to be an honest working guy, making your money from actual work. Unearned income
“...is any income that comes from sources other than employment (work). Examples of unearned income include interest from bonds, savings accounts, and other sources; dividends from stocks; capital gains from selling investments at a profit; and income from rental property.” http://www.investorglossary.com/unearned-income.htm
Of course, unearned income has significant tax advantages over earned income. Welcome to the world of the rich.
“There is a sound philosophical basis for capital gains tax rates being lower than income tax rates? You honestly believe they should be higher?” There are probably some sound reasons for doing almost anything to the tax code, however the reason for giving rich people in the US a serious tax break for making millions of dollars buying and then selling VALE (a Brazilian mining company)is beyond my understanding. By the way, lots of millionaires made a lot of money doing just that. Likewise, investing in Chinese ETF’s. Anyway, I’m not sure that anyone has shown that the amount of investing has ever been seriously affected by the tax rate on capital gains. Buffett says he doesn’t remember anyone turning down one of his recommended deals when capital gains taxes were at 40% because they were worried about their tax rate. I know it has never affected my investing.
“...And I can readily imagine a lot of causes and charities — not mention job-creating enterprises — that deserve your perceived excess cash far more than the U.S. Treasury.” I’m sure that’s true for everyone who pays taxes. But really, I feel like the American people have done enough looking after rich people’s tax rates. If you want to cut somebody’s taxes, pick out another group.
“...is any income that comes from sources other than employment (work). Examples of unearned income include interest from bonds, savings accounts, and other sources; dividends from stocks; capital gains from selling investments at a profit; and income from rental property.”
Thanks for the condescension. But I know full well what the definition of "unearned income" is.
But that is an intentionally loaded term -- a liberal definition if ever there was one.
"Interest from bonds, savings accounts, and other sources; dividends from stocks; capital gains from selling investments at a profit; and income from rental property.” are every bit as "earned" as wages from digging ditches. It takes time, effort and skills to manage investments; indeed, people actually have jobs doing so. Are their wages "unearned"?
If you really believe the rich are under-taxed -- and you believe yourself rich -- then I expect you have a long and admirable record of writing an extra check to the Treasury every tax year.
If you don't, you are a hypocrite of the first order.