In my econ class we were talking about how interest gained on bonds is subject to federal taxes. This is true for all private sector and federal bonds, however does not apply to state and municipal bonds. I was getting more and more pissed the more I heard about this. Obviously, I am against the capital gains tax and want it repealed in its entirety, but would it be “good” if the federal government extended these taxes to municipal and/or state bonds so as to encourage private investment? Or would that further centralize power?
This would not encourage private investment, but discourage investment in municipal / state bonds. I prefer a public bond issuance to a back-alley bailout from the federal government.
“Balancing” one theft with another would only compound the injustice.
state and municipal bonds are devices/tools to support the state. just as there should be no state their should be no bonds to invest in them.