This is the Cato Daily Podcast for Tuesday, August 7th, 2018.

I'm Keelip Brown.

A proposed change to the tax treatment of capital gains would mean no longer providing the federal

government with windfall revenues driven by inflation.

Maddie Dupler is a senior fellow at the National Taxpayers Union and a board member at the new Center for a Free Economy.

We spoke yesterday.

How long has this proposed change with respect to capital gains been kicked around.

This policy change has certainly been in discussion for Republicans for decades.

Now, the last time we saw it seriously considered by an administration was in

1992 under the the first Bush administration when a legal memo was produced by

the Department of Justice arguing that this would be outside the scope of Treasury to undertake this

definitional change. Now since then and even at that time there was a

discussion as to whether or not that opinion was firmly rooted in both legal reasoning and with a full

understanding of the scope of Treasury's capabilities and certainly as we've seen

over the past 30 years,

the scope and nature of the way the executive branch works

has changed.

So there have been a lot of legal scholars

that at the time questioned whether or not

this was the right approach. And I should say that this wasn't a binding legal decision from the Supreme Court saying that the administration can't undertake this this kind of action. It was simply an internal legal memo from some lawyers who decided that this would possibly be a contentious move and so Treasury should decline to do so.

There has been a lot of discussion ever since then as to whether or not the Bush administration

was being too hesitant in not trying to pursue this policy goal.

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