In response to:

Prophets and Losses: Part II

Ned6 Wrote: Feb 06, 2013 4:35 PM
Reduced capital gains revenue is the least of our worries. An increase in the capital gains rate lowers the return on investment, reducing the number of investments that satisfy minimum hurdle rates of return. Lost are new companies that never exist, which would have contributed taxes on wages and taxes on profits that far exceed any taxes on investment that might have been achieved.

Editor's Note: This column is part II in a series. Part I can be found here.

People on both sides of tax issues often speak of such things as a "$300 billion tax increase" or a "$500 billion tax decrease." That is fine if they are looking back at something that has already happened. But it can be sheer nonsense if they are talking about a proposed increase or decrease in the tax rate.

The government can only raise or lower the tax rate. Whether the actual tax revenues that the government will collect as a result will go up or...