Quote from Maverick74:
OK, a couple of things here. That 3k deduction is for retail traders, not professional traders. Second, professional traders can actually write off all their losses if they are setup properly. THAT I don't have an issue with and I will tell you why. For traders who risk THEIR capital and pay taxes on their capital, if they lose all their money, they get ZERO benefits from the government. ZERO. They CANNOT collect unemployment, and in many cases, they can actually owe money to the government with a zero net worth. I have always believed that ANYONE who risks THEIR own money, not other's people's money as in a hedge fund, but their own money, they should not pay ANY taxes. If they ARE going to pay taxes, then they should be able to recover their losses from future earnings.
I have mixed feelings on letting corporations getting away with this mostly because they are not risking THEIR money. They have stock holders, bond holders, and loans from the bank. I don't think corporations should be able to use debt and losses to manipulate the system for personal benefit which many corporations do., But you asked about traders. And for professional traders, giving them a "clawback" does not constitute a subsidy. The reason for this is that the taxes they pay in are coming from risks they are taking. In other words, they own the downside along with the upside. They should be able to offset losses with gains and vice versa. The bigger macro problem are the too big to fail banks who get to own all the upside and lay of the downside on taxpayers.
With regards to Tesla or Solyndra, they are getting taxpayer money in which THEY reap all the upside and the taxpayer gets nothing. That is unless they go bankrupt, in which the tax payer pays the entire bill. Now, let's try this. Say if Tesla was going to be owned by the gov't entirely. And the profits from Tesla go straight back to the taxpayer instead of to Elon Musk, then you have a different argument. You have now balanced both sides of the ledger. The taxpayer gets the upside and the downside. Then the argument shifts to fairness and cronyism. For example, are we nationalizing Tesla because Elon Musk was a large donor to the Obama Campaign? Are we going to siphon tax dollars from middle class Americans and line the pockets of people inside the company and then claim the company is not profitable therefore no income is going back to the tax payer? See how complicated this can get.
This is why the easiest solution is to make the game fair and let the best man win. Simplicity adds value. We keep the gov't honest, we keep the system honest and we provide an incentive for others to try and take risks knowing they have a fair shot instead of not taking a risk because they know the crony who donates to the white house is going to get the contract.
