美国国家公共电台 NPR--Democrats aim to partially tighten the carried interest loophole

Democrats² aim to partially³ tighten⁴ the carried interest loophole

Transcript⁵

NPR's Asma Khalid talks to David Wessel of the Brookings Institution about the partial closing of the carried interest loophole, central to a Senate compromise over climate spending and health care.

ASMA KHALID, HOST:

You know that big, sprawling⁶ Senate compromise about health care and climate change that Democrats Joe Manchin and Chuck Schumer reached last week? Well, there is a lot in it, including this one particularly controversial nugget. It is what is known as the carried interest loophole. It's been a target of every president going back to George W. Bush. It lets wealthy hedge fund managers pay less in taxes. And the Democrats' Senate bill attempts to partially close that loophole. To take a deeper look at what exactly it is and why it's drawn⁷ so much political attention over the years, we've called up David Wessel. He's director of the Hutchins Center at the Brookings Institution. Welcome back to the program, David.

DAVID WESSEL: Good morning, Asma.

KHALID: So, David, let's begin with a definition. Help us understand what exactly carried interest is and who really benefits from this loophole.

WESSEL: Sure. Partners in private equity⁸ firms and hedge funds who generally manage other people's money get a share of the profits from any deal they do, often about a 20% share, even if they have invested any of their own money in it. Today, they pay taxes on that income at the capital gains rate, 23.8%. Under the tax code, this isn't considered part of their compensation. If it were, they'd be taxed at the ordinary income tax rate of up to 37%. And these folks make a lot of money. The Wall Street Journal says the 28 top executives of five big private equity firms shared $760 million in carried interest. That's more than $25 million each.

KHALID: Oh, wow.

WESSEL: So this loophole saves a few people a lot of money on their taxes.

KHALID: So, you know, over the weekend, Senator Manchin appeared on a number of Sunday shows. He was on Fox News Sunday defending this deal. And I was struck by the language he used. You know, he talked about loopholes.

(SOUNDBITE OF FOX NEWS BROADCAST)

JOE MANCHIN: We did not raise taxes. We've closed loopholes.

KHALID: So, David, this raises the question to me, I mean, does this massive bill, the Inflation Reduction Act, really do what Senator Manchin says that it will do?

WESSEL: Well, for those people who are affected⁹, it's a tax increase. It raises about $14 billion over 10 years. That's a lot of money, although a small slice of all the money in this bill. It wouldn't completely close the loophole, but it would substantially restrict it. Partners would have to hold their investment for five years up from the current three to get the lower tax rate. And it would make all sorts of technical changes, all of which would get more money out of them for the Treasury¹⁰.

KHALID: So, you know, in years past, we've seen both Republican and Democratic presidents try to close this loophole. Congress, Democrats included, I should point out, have resisted this effort. So help us understand why there has not been a consensus¹¹ in Congress to do something about this.

WESSEL: Well, there are a lot of private equity and hedge fund partners who are big campaign contributors, including to Democrats, and they care about this a lot. And all the other constituents¹² of Congress don't even know what it is. So despite the Democrats' tax the rich rhetoric¹³, this provision always seems to fall out of any proposal before it's passed by Congress. And in fact, we still don't know if this one is going to survive. Senator Kyrsten Sinema, the Arizona Democrat¹ who has not been happy about closing the carried interest loophole, hasn't said yet whether she'll support it. And since the bill requires all 50 Democrats to go along, it's - it could yet survive. It's worth noting that in 2017, it was the Republicans who succumbed¹⁴ to industry pressure and made very minor¹⁵ changes to carried interest despite President Trump's attacks on it.

KHALID: And, David, very briefly¹⁶, what is the argument for leaving the loophole alone?

WESSEL: Basically, the industry says this tax increase will limit their ability to punish - to invest in small businesses and hurt the economy.

KHALID: David Wessel of the Brookings Institution, thank you as always.

WESSEL: You're welcome.

1 democrat   

n.民主主义者，民主人士；民主党党员

参考例句：

• The Democrat and the Public criticized each other.民主党人和共和党人互相攻击。
• About two years later,he was defeated by Democrat Jimmy Carter.大约两年后，他被民主党人杰米卡特击败。

2 democrats   

n.民主主义者，民主人士( democrat的名词复数 )

参考例句：

• The Democrats held a pep rally on Capitol Hill yesterday. 民主党昨天在国会山召开了竞选誓师大会。
• The democrats organize a filibuster in the senate. 民主党党员组织了阻挠议事。 来自《简明英汉词典》

3 partially   

adv.部分地，从某些方面讲

参考例句：

• The door was partially concealed by the drapes.门有一部分被门帘遮住了。
• The police managed to restore calm and the curfew was partially lifted.警方设法恢复了平静，宵禁部分解除。

4 tighten   

v.(使)变紧；(使)绷紧

参考例句：

• Turn the screw to the right to tighten it.向右转动螺钉把它拧紧。
• Some countries tighten monetary policy to avoid inflation.一些国家实行紧缩银根的货币政策，以避免通货膨胀。

5 transcript   

n.抄本，誊本，副本，肄业证书

参考例句：

• A transcript of the tapes was presented as evidence in court.一份录音带的文字本作为证据被呈交法庭。
• They wouldn't let me have a transcript of the interview.他们拒绝给我一份采访的文字整理稿。

6 sprawling   

adj.蔓生的，不规则地伸展的v.伸开四肢坐[躺]( sprawl的现在分词 )；蔓延；杂乱无序地拓展；四肢伸展坐着（或躺着）

参考例句：

• He was sprawling in an armchair in front of the TV. 他伸开手脚坐在电视机前的一张扶手椅上。
• a modern sprawling town 一座杂乱无序拓展的现代城镇

7 drawn   

v.拖，拉，拔出；adj.憔悴的，紧张的

参考例句：

• All the characters in the story are drawn from life.故事中的所有人物都取材于生活。
• Her gaze was drawn irresistibly to the scene outside.她的目光禁不住被外面的风景所吸引。

8 equity   

n.公正，公平，（无固定利息的）股票

参考例句：

• They shared the work of the house with equity.他们公平地分担家务。
• To capture his equity,Murphy must either sell or refinance.要获得资产净值，墨菲必须出售或者重新融资。

9 affected   

adj.不自然的，假装的

参考例句：

• She showed an affected interest in our subject.她假装对我们的课题感到兴趣。
• His manners are affected.他的态度不自然。

10 treasury   

n.宝库；国库，金库；文库

参考例句：

• The Treasury was opposed in principle to the proposals.财政部原则上反对这些提案。
• This book is a treasury of useful information.这本书是有价值的信息宝库。

11 consensus   

n.(意见等的)一致，一致同意，共识

参考例句：

• Can we reach a consensus on this issue?我们能在这个问题上取得一致意见吗？
• What is the consensus of opinion at the afternoon meeting?下午会议上一致的意见是什么？

12 constituents   

n.选民( constituent的名词复数 )；成分；构成部分；要素

参考例句：

• She has the full support of her constituents. 她得到本区选民的全力支持。
• Hydrogen and oxygen are the constituents of water. 氢和氧是水的主要成分。 来自《简明英汉词典》

13 rhetoric   

n.修辞学，浮夸之言语

参考例句：

• Do you know something about rhetoric?你懂点修辞学吗？
• Behind all the rhetoric,his relations with the army are dangerously poised.在冠冕堂皇的言辞背后，他和军队的关系岌岌可危。

14 succumbed   

不再抵抗（诱惑、疾病、攻击等）( succumb的过去式和过去分词 )； 屈从； 被压垮； 死

参考例句：

• The town succumbed after a short siege. 该城被围困不久即告失守。
• After an artillery bombardment lasting several days the town finally succumbed. 在持续炮轰数日后，该城终于屈服了。

15 minor   

adj.较小(少)的，较次要的；n.辅修学科；vi.辅修

参考例句：

• The young actor was given a minor part in the new play.年轻的男演员在这出新戏里被分派担任一个小角色。
• I gave him a minor share of my wealth.我把小部分财产给了他。

16 briefly   

adv.简单地，简短地

参考例句：

• I want to touch briefly on another aspect of the problem.我想简单地谈一下这个问题的另一方面。
• He was kidnapped and briefly detained by a terrorist group.他被一个恐怖组织绑架并短暂拘禁。