Bush/Obama Tax cuts

Quote from 124nic8 : So you're claiming someone like Bill Gates could not have become a multi-billionaire if cap gains were taxed as ordinary income?

Not necessarily but you likely are reducing to some degree the availability of capital for investment and raising the cost.

When some call for increased taxes on sugar, soft drinks, ammo, etc., what is the desired and assumed effect of increasing such taxes?

Why would you think that increasing taxes on capital investment would work any differently?

Hate to break it to you but the very rich don't have to invest their money. And if they chose to, there are many ways to do so that involve little risk, result in minimal if any taxable capital gains, and they'll STILL make a bunch of money. But there will be less incentive to go to those investments at higher risk that do result in cap gains.

It's a fairly simple financial equation. As an investor, I'm looking at the net cost, net return, timing, and risk. If I have greater costs/risk/longer payback, I'm just going to factor that into the basis for the cost to provide that capital. So when some city or company wants to sell bonds to pay for that new school, library, hospital, bike path, etc., it's just going to cost them more. Which, at least in the case of public funding, in turn will just be passed back to the taxpayer again in the form of higher taxes to support the payments to investors.