Commentary: Ted Cruz and his GOP colleagues are pushing yet another tax break for the 1%
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America’s beleaguered 1%, backed by their supporters in Congress, are pleading for your sympathy.They say they’re treated unfairly by the federal tax code, you see, because inflation has sapped the value of their most cherished tax break, the preferential tax rate on capital gains.
And they want it fixed.Inflation, says Sen.Ted Cruz (R-Texas), the leading proponent of this idea, has been “turning gains into an unfair tax burden.” Last year, he proposed to rectify this injustice via the Capital Gains Inflation Relief Act of 2025.
That was a rerun of similar bills he introduced in 2018 and 2021.None of them passed, so this time around, he’s proposing to circumvent Congress entirely by persuading President Trump to enact the break by presidential fiat.
The argument proponents make sounds logical until you think about it.— Steve Wamhoff, Institute on Taxation and Economic Policy (2019)The reaction by legal and economic experts outside the GOP echo chamber has been overwhelmingly negative.Whether Trump could enact the tax break via executive order is dubious , they say, and in any event the break is unwarranted and economically unwise.“The argument proponents make,” wrote Steve Wamhoff of the Institute on Taxation and Economic Policy in 2019, “sounds logical until you think about it.” The legal and economic considerations haven’t changed since then.Commentary on economics and more from a Pulitzer Prize winner.
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As Wamhoff observed, there’s a certain amount of superficial logic underlying the argument that inflation in eff...