There are things in our economic system, in useful capitalism, that we need, and things that we don't - things that can hurt more than help. Investment in business often is constructive. But the rawer forms of financial speculation, which have become such a large part of what we've built our economic house of cards on over the last decade, tends not to be.
So this may be one of the more beneficial pieces of legislation Congress considers this year, as reported via Dow Jones: "This week, Sen. Ron Wyden, D-Ore., plans to introduce a bill that would do away with tax incentives for all types of speculators, including hedge funds and pension funds. The legislation would tax the trading gains and losses of any taxpaying speculative energy trader the same way that commercial traders are currently taxed by treating them as ordinary gains and losses. Gains made on oil and natural gas investments would lose their eligibility for lower capital gains rates. The bill would also end the tax-exempt status for certain energy commodity investors like pension funds. Under this proposal, their gains would be classified as 'unrelated business taxable income.'"
Inexcusable that these kinds of financial devices weren't always treated this way (and a testament to the skill of certain highly-paid lobbyists). Just maybe, some correction is en route.
In case you're wondering what the practical effects of this may include, note that phrase "speculative energy trader." Do you wonder why the price of gas bounces around the way it does, so often untethered to the price of oil or any other apparently price point? Look to the speculators . . . and then think about what might happen if they were a much less critical part of the picture.