September 30, 2001
Even before the ruins of the World Trade Towers stop smoldering, Congressional leaders are quietly planning to revive their favorite scheme to boost the economy—a $20 billion plus cut in capital gains taxes, possibly as an add-on to minimum wage legislation. Proponents, led by Senate Minority Leader Trent Lott, claim that a temporary cut in the already low tax rate on profits would both raise revenues and stimulate spending and investment. That's nonsense. While a capital gains tax cut would surely boost the bank accounts of the wealthy, it would not revive our flagging economy and might further destabilize the skittering stock market.