Hillary Clinton visited New York University’s Stern School of Business this week to give a speech on economic policy. On the surface that sounds roughly as interesting as watching paint dry, but she dropped a few gems into the otherwise standard, liberal dogma which caught the attention of analysts around the country. Echoing some familiar sentiments of more fire breathing socialists, Clinton said that capitalism itself was “out of balance” and in need of a “reset.” (Fortune Magazine)
Hillary Clinton wants to hike capital gains taxes as part of her plan to discourage short-term thinking among corporate executives and investors…
To bring what she called “hit-and-run” activist shareholders to heel, Clinton exhorted institutional investors to exert their leverage as a counterweight on management. And she pledged to order a review of regulations on shareholder activism and to push for the same-day disclosure of buybacks already in force in the United Kingdom and Hong Kong.
Clinton also called out excessive compensation packages for executives as part of the problem. “I’m all for rewarding CEOs well when their companies prosper and their employees also share in the rewards,” she said. “But there is something wrong when senior executives get rich while companies stutter and employees struggle.”
Da, comrade, but please to tell us… how will you slay this capitalist dragon?
As the Wall Street Journal reports, this is far more about window dressing and hitting the right buzzwords than any sort of startling new ideas about reform.
Campaign advisers say Mrs. Clinton’s goal is chiefly to change investor behavior, not to address income inequality or to raise money for the federal Treasury. The campaign had no estimate on how much money her changes would generate.
That’s pretty much it in a nutshell. Clinton is still worried about losing the Elizabeth Warren wing of her party to upstarts like Bernie Sanders and she knows she needs to sneak in all the right buzz phrases. Income inequality and sticking it to the fat cats on Wall Street is the red meat the base is craving so she’s going to serve it up. (Which is rather hilarious considering Clinton’s long and well documented history of cronyism and tight ties to the investment banking community.)
She did at least lay out some concrete proposals, but they won’t sound like anything new to anyone who’s been paying attention for the last thirty years. She would double the capital gains tax on investment returns gained over a period of two years instead of the current 12 month ceiling, and then only gradually taper the rate so that investors would have to hold on to their investment for six years before seeing the current 20% capital gains bill. As the article notes, her own team isn’t claiming this is going to create some sort of windfall for the federal purse… it’s just a way to punish those who are “too successful” and remind them that they should be giving more of their money away to the less fortunate.
Oh, and on that score she also kept hitting the idea that CEO pay is somehow to blame for much of society’s ills. That’s another theme lifted in whole cloth from Liz Warren. But the overall message was fairly clear once you strip away all of the campaign trail slogans. Democrats like to raise taxes and Clinton won’t be any exception. They also bank on the fact that the unwashed masses are envious of the wealthy and would like to see them knocked down a few pegs rather than figuring out ways for them to rise up and join the ranks of the comfortably successful.
Shorter campaign theme: capitalism is awful but we can’t live without it, so we’ll just punish those who profit by it.