This makes the stock market little more than an arcane gambling system, designed to fleece the unwary, while providing a stomach acid churning living for Wall Street's equivalent of dealers, croupiers, and pit bosses. The only real winners in this gambling free-for-all in recent years are the con-men and the house, who have learned to successfully game the system, or make most of their money skimming it off the top in fees. Unfortunately, perhaps, the con-men who are caught end up in Club Fed rather than an unmarked grave in the desert, even if they have bilked hundreds of millions of dollars from innocent investors.Â
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Mario Puzo was right: a man with a briefcase can steal more in an hour than a man with a gun can steal in a lifetime. And probably win ??Businessman of the Year ? awards while doing it.Â
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This gets us back to capital gains and estate taxes. Estate taxes are paid by less than one-half of one percent of all estates in this country. Most of the tax involves large scale capital gains realized by the estate over the course of many years. I usually refer to the estate tax as the ??Paris Hilton Tax. ?  It is a tax of which Thomas Jefferson would have approved, because it helps to prevent the establishment of a hereditary aristocracy in the United States.Â
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I believe Jefferson would have approved of the capital gains tax for the same reason. The capital gains tax is not about taking away wealth, but rather limiting it, in order to prevent (or at least slow down) the creation of what is in essence an overbearing hereditary aristocracy.Â
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The people most effected by this tax, the so called ??investor class, ? scream that they are being punished for providing the means to make the American economic system work.Â
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Nothing could be further from the truth.Â
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The investor class will invest their money where it will realize the highest possible return. Unfortunately, this has meant the flavor du jour of economic bubbles in the United States financial world for more than thirty years. Enron, the housing market, World Com, the savings and loans, derivatives, the dot coms and various markets (stock, commodity, etc.) have been the focus of investors within this country, not manufacturing or anything that might help create a self-sustaining economy. Their investments in this regard have been leaving the United States to help Korea, Taiwan, Singapore, India, Malaysia, Mexico, etc., establish their manufacturing base wherever cheap labor with no industrial regulation can be found. Unfortunately, in the name of ??free trade, ? we have eliminated virtually every tax and tariff penalty that once existed for American investors, that had been created to keep our nation's investment capital at home. And if you do not think that the loss of investment capital overseas is important, look at what happened to Great Britain at the end of the Nineteenth and early Twentieth Centuries.Â
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What this essentially means is that most of the industrial jobs that permitted a single wage earner to provide the money to realize the ??American Dream, ? have left the country. It now requires at least two incomes per household to maintain a middle class lifestyle.Â
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