Trump Considering Tax Holiday for Capital Gains

White House economic adviser Kevin Hassett suggested Sunday on CNN that the White House is considering a tax holiday for capital gains.

Here is the relevant exchange:

DANA BASH: OK.
What about direct payments to Americans? 

KEVIN HASSETT: That was something that was an enormously successful part of the first three phases. We mailed, like, $1,200 checks to 140 million people.

And I think, depending on the state of the economy, it's something that I guess we would consider. But, right now, it looks like the economy's picking up at a very rapid rate, in which case we could potentially move on to other things that the president has mentioned, like the payroll tax cut and potentially even a capital gains holiday.

And earlier in May, President Trump tweeted this:

Well run States should not be bailing out poorly run States, using CoronaVirus as the excuse! The elimination of Sanctuary Cities, Payroll Taxes, and perhaps Capital Gains Taxes, must be put on the table. Also lawsuit indemnification & business deductions for restaurants & ent.

— Donald J. Trump (@realDonaldTrump) May 5, 2020

I have zero problems with supporting cuts or eliminating particular taxes but if they are not accompanied by cuts in government spending, it is just a shell game where money is taken out of the private sector in other ways, either through borrowing that crowds out private sector borrowing or borrowing that is monetized by the Federal Reserve, neither is good. Both methods work to decrease the standard of living in the country.

Yes, by all means, cut taxes but also cut government spending at the same time.

-RW