Blunt Policy Instruments

If the intention is to provide an incentive for new direct investment, employment, and industrial modernization, then an across-the-board capital gains tax cut is at best a blunt policy instrument. We have examined several reasons to doubt that further cuts in capital gains taxes will have a pronounced incentive effect on new direct investment.49 Capital gains tend to reward accumulation of old assets more than production of new wealth. ...

Economic policy should distinguish between activities which add to productive capacity and those which merely add to overhead This distinction elevates the policy debate above the level of merely carping about inequitable wealth distribution, an attack by have-nots on the haves, to the fundamental issues. What ways of getting income deserve fiscal encouragement, and how may economic surpluses best be tapped to support government needs? Policies that subsidize rentier incomes while penalizing productive effort have grave implications, not only for distributive justice and social harmony, but also for economic efficiency and growth. Read the whole article

Wealth and Want
... because democracy alone is not enough to produce widely shared prosperity.
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... because democracy alone hasn't yet led to a society in which all can prosper