Eleanor Clift, The McLaughlin Report, April 17, 2005:
Progressive Democrats last week came out with an interesting tax idea, that is, why don't we tax wealth, uh capital and earnings at the same rate, wages at the same rate. Right now the working man pays more on the money that he puts his blood sweat and tears out for than people uh, get on capital that just sits there. It's an interesting idea and we're going to hear more about it.
Prometheus 6, Oldspeak vs. Newspeak, August 1, 2004.
Unearned income (as defined by the US Tax code) is taxed at a much lower rate than earned income. In the U.S. Tax code, unearned income is privileged over earned income, and in Republican political and economic policy even more so.
People whose earned income is taxed at 40% can be subsidized if their income is mostly of the unearned sort.
Remember that when Republicans talk about keeping your "hard earned money." Their tax cuts are almost all on the unearned type of income.
There is a logic to the idea that all forms of revenue streams are ultimately "income". It is untrue of course, that capital " just sits there", that's specious unless you have your money in a mattress but theoretically, you could lower income taxes by creating a single tax rate that covers all bases.
However that's probably not the intent here. The likely Progressive interest is simply a tax hike on capital gains- ppl in the 40 % bracket are the evil rich so they won't get anything - and ultimately resecuring high marginal rates on all forms of taxation that prevailed from the New Deal to the Kennedy Tax cuts. The Progressives are not going to drop the potential of using the tax code as a social engineering tool just to get a neat and tidy harmonization of tax rates either.