Will No One Rid Me Of This Turbulent Tax Break?

More on the carried interest loophole and why it refuses to die.

Grigori Rasputin, the carried interest loophole of his day.

“This devil who was dying of poison, who had a bullet in his heart, must have been raised from the dead by the powers of evil. There was something appalling and monstrous in his diabolical refusal to die.” Thus Prince Felix Yussupov, Grigori Rasputin’s murderer, in his memoir Lost Splendor.

I hope 106 years isn’t too soon to treat the mad monk’s purported resistance to being dispatched (his daughter disputed Yussupov’s account) as a metaphor for tax policy. My headline makes jocular reference to the murder of Thomas à Becket, but that was 852 years ago and I feel certain we’ve all gotten over that. Still, let me make clear that this newsletter does not condone violence in any form except as metaphor, and that Yussupov and King Henry II should have used their words.

That said, the carried interest loophole is definitely the Rasputin of tax breaks. It has been saved and saved and saved again, this week by Senator Kyrsten Sinema, who also saved it last year, even though no rational defense has ever been mounted on its behalf. (Many have tried.) Will no one rid me of this regressive misclassification of labor income?

That is the subject of my latest New Republic piece.