Obama raids another reservoir of private capital

U.S. companies are gasping for cash like beached fish fruitlessly flapping their gills. Rather than help these firms find financial oxygen, President Obama would accelerate their asphyxiation.

Specifically, Obama’s February 22 health reform proposal would sic the 2.9 percent employer-employee Medicare tax onto “income from interest, dividends, annuities, royalties, and rents.” This spanking-new investment-income tax would slam individuals who make more than $200,000 and north of $250,000 for married couples. These folks, who often risk their money in fledgling companies, will not enjoy Washington’s applause. Instead, Democrats will demand that they surrender even more of the proceeds of their productive capital.

This 2.9 percent tax may sound picayune, until its 10-year cost emerges: $234 billion --Americans for Tax Reform reckons -- or $334 billion, if it smacks capital gains.

So, while unemployment hovers near 10 percent, and the economy reeks of a relentless hangover, Obama would vacuum up to one third of a trillion dollars from the productive sector and pump it into an increasingly hated entitlement scheme.