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In 2012 Sheldon Adelson, the Koch brothers, and other billionaires were the vanguard of Republican funding machine.  Adelson himself spent $100 million.    

So what was Adelson's return on investment?  He lost the presidency, but there still is a Republican majority in House that wants Adelson's funding to keep flowing in 2014.  So they are fighting hard to keep tax rates for the wealthy from going up.  

Interestingly, the Republican offer to raise revenue by limiting deductions for the wealthy favors billionaires like Adelson.  The people who are right at the boundary of the top 1% would pay a lot more when their mortgage deduction is limited.  But for people in the top 0.00001% like Adelson, deductions do not make as big a difference, and rates (especially capital gains rates) are most important.  

If the Bush tax cuts do expire for the wealthy, capital gain taxes will go up from 15% to 20%.  Billionaires typically pay at the capital gains rate, so Adelson would pay 5% more of his income in taxes.  The stock market went up by about 10% in the last year so if Adelson's financial planners can duplicate that performance next year he would earn $2 billion in income off his $20 billion net worth.  Let's see, 5% more taxes off a $2 billion income = $100 million.  

$100M spent to avert a $100M per year tax increase.  That is a pretty sound investment for Adelson if he can get away with it.  

Originally posted to Position2win on Sat Dec 01, 2012 at 02:17 PM PST.

Also republished by Community Spotlight.

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