A lot of people have been absolutely lamenting about the Harris plan to tax unrealized capital gains. Worry not, fam, it's not going to happen. How do I know? Because it can't happen.
Being worried about unrealized taxes is like being worried about someone pulling all the oil out of an engine. Even if they do it (they won't) the entire engine blows up and they have to immediately change their strategy. It's an empty promise to yoink votes.
A very effective empty promise.
I'm starting to learn the hard way under great penalty to my own sanity that this completely and obviously empty rhetoric is one of the greatest fake promises in the history of all time:
On the one side we have democrats who are like YEAH TAX THE RICH MAKE ELON MUSK AND BEZOS PAY THEIR FAIR SHARE RAH RAH RAH! On this side we also have poor people (and a lot of the middle class) who are in debt and living paycheck to paycheck, so they don't care about taxes on investments that they don't have. If people think they have something to gain and nothing to lose they'll support the thing. Politics are quite selfish in this way; it thrives on individualism.
And then on the other side we have republicans who believe this lie because it's extremely convenient for them to believe. When your political opponent says something absolutely fucking stupid you're going to be inclined to unquestionably believe what they are saying in order to stack up your position against them. This ironically makes the empty promise of unrealized taxes perhaps one of the best pieces of propaganda of all time. It's so dumb that everyone believes it's real, somehow. Because reasons.
Unrealized taxes do not exist in multiple ways.
On the frontend, unrealized taxes do not exist because unrealized taxes are quite simply forced selling. Because selling is in itself a tax event that creates realization the entire concept becomes a paradox.
On the backend, unrealized taxes do not exist because the money being taxed doesn't actually exist. Unrealized taxes, on a very real level, assume that supply and demand do not exist. It also assumes that liquidity does not exist. It assumes that every share of every stock in the entire world economy can be bought and sold at the current price without ever changing. In other worlds: it's completely delusional.
If, for example, Tesla stock pulls something crazy like an x3 during any given fiscal year, any speculator will be able to see that every single person who owns Tesla stock is going to owe an absolute shit ton of unrealized taxes. So not only will Tesla share holders be dumping to frontrun the forced selling, but speculators move in with fake leveraged money and short the stock as well. This creates 4 dump events:
- Frontrunners have to sell their stock.
- Speculators borrow shares and dump them on the market.
- Billionaire entities like Musk and Blackrock have to sell.
- Ignorant retail investors panic sell the bottom after everyone else.
At the end of the day it's a mathematical certainty that some of these sellers would lose more than 100% of their gains simply trying to pay a 25% tax that assumed everyone could sell at the January 1st spot price.
Unrealized taxes also basically make startup companies impossible, because the liquidity of shares is completely non existent. You'd owe money that was literally impossible to acquire. Unrealized means unrealized for a reason: it doesn't exist.
So I ended up watching several youtube videos on this topic... and they all make pretty good points as to why unrealized taxes are a terrible idea. But none of them realize it's so terrible that it's vaporous virtue signaling only meant to capture votes in an election.
I'm told by my liberal friends that Ron DeSantis is a real piece of shit, and honestly I'm included to believe that considering all politicians are garbage. However, in this video, he talks like a sane person.
Many will point out that the Harris tax plan only targets billionaires, and more specifically people who are worth more than $100M, which is a very short list. This is a silly argument to make for two separate reasons. The first one being that taxes like this always start at the top and inevitably just get more and more aggressive and trickle down to the bottom of the pyramid. There was a time when income taxes operated the exact same way and the middle class had 0% income tax.
It's only for people who have a net worth over $100M...
...
...
for now.
lol for now
gtfo with this slippery slope
Oh wait you mean this isn't a new thing?
Check out this video from 2020 from @nealmcspadden when the Biden Administration was talking about it then too. Gee could it be that this is just a completely bogus event that only gets talked about during election seasons?
Conclusion
All politicians are lying snakes that constantly make empty promises, but when the opposing candidate says some completely idiotic nonsensical shit they must be telling the truth, right? Hm, wrong. The Biden administration has been virtue signaling about unrealized taxes since before they took office in 2020. They do this EVERY ELECTION SEASON. They talk up a big game and then poof they never talk about it until next election. Pay attention folks.
I am not seeing a single person out there on social media or YouTube call out unrealized tax for what it is: a complete and utter unsustainable fantasy that would cripple the economy immediately and directly opposes the billionaires who control government. I find it highly disturbing that over 99% of the population can't see right through this obvious nonsense. It shows an alarming lack of critical thinking skills, or rather the ability for this type of propaganda to bypass all critical thinking and deflect it to supporting or opposing binary partisan politics. Opt out of the bullshit, please and thank you.
Billionaires are the ones pulling the strings, and both sides think that a vice president with historically low approval rates is going to magic in some phantom tax on the top 0.0028%? What are they smoking? I want some.