EDUCATION CENTER
IN THE MEDIA: NY TIMES

Andrew Ross Sorkin of the New York Times interviewed me about the history and future status of lower 60/40 tax rates. Read his article “An Addition to the List of Tax Loopholes” published July 11, 2011.

Mr. Sorkin quoted me and used some content from a draft version of my blog Are lower 60/40 tax rates on futures in jeopardy?, which I sent to him while he worked on his article. While our articles are similar in content, we reach an opposite conclusion. Mr. Sorkin suggested adding 60/40 futures tax rates to the list of tax loopholes being bandied about by the President and Democrats in connection with the contentious debt-ceiling debate. Conversely, I’m in the Republican camp on taxes — I don’t want tax hikes now, but I support meaningful tax reform efforts.

Mr. Sorkin told me that some in Congress are looking at the Section 1256 60/40 tax rates, which implies to me they are thinking about getting rid of them. He mentioned they saw a recent CFTC report, which showed that 80 percent of trading volumes on commodities exchanges are short-term trading. Which begs question: Why do futures traders receive the 60 percent long-term capital gains benefit? The remaining 40 percent is subject to short-term capital gains rates — the higher ordinary income tax rates. Why should futures traders and commodities exchanges enjoy this tax break, when securities traders and exchanges don’t?

June 23, 2011: The New York Times published a very similar article to my blog Who’s The AIG In This Financial Greek Tragedy? A week before, I invited Ms. Louise Story of NYT to read my blog and pursue the story too. CNBC published this NYT story on their front page, see http://www.cnbc.com/id/43506232.

Derivatives Cloud the Possible Fallout From a Greek Default. By LOUISE STORY, Published: June 22, 2011. “It’s the $616 billion question: Does the euro crisis have a hidden A.I.G.?”