Robert Reich argues that it is grossly unfair that Mitt Romney earns $21M, but pays only 13% in taxes. He argues that many private-equity, hedge-fund, and pension-fund managers are often playing “con games” that screw the American taxpayers. He offers several solutions:
1. Don’t allow private-equity managers to treat their income as capital gains, taxed at 15 percent. Treat this income as ordinary income.
2. Hold them to a “due diligence” standard, so the Pension Guaranty Corporation can claw back bonuses.
3. Raise the capital-gains rate to match the tax rate on ordinary income.
4. Resurrect Glass-Steagall.