Carried interest is the share of profits that private equity, hedge fund, and venture capital managers receive — typically 20% of the fund’s gains. Under current law, this compensation is taxed at the capital gains rate (20%) rather than as ordinary income (up to 37%). A hedge fund manager earning millions in carried interest pays roughly the same tax rate as a teacher earning $60,000.

This is not a gray area. It is compensation for managing other people’s money, not a return on the manager’s own invested capital. The tax treatment reflects decades of lobbying by the private equity industry, not economic logic. Closing the loophole would raise an estimated $6.5–$12 billion annually. Every administration for twenty years has proposed closing it. The 2025 Republican tax bill left it intact.

Trump promised to close it in 2016. He didn’t. It remains one of the most clear-cut examples of who the tax code was written for — and it is not you.

The estate tax — a tax on wealth transferred at death above a threshold — was designed to prevent the permanent entrenchment of dynastic wealth and to ensure that extraordinary fortunes, built partly through public infrastructure and public policy, returned something to the public when they changed hands. At its peak, it applied to estates above $1 million (in today’s dollars) at rates up to 77%.

Today, the exemption threshold stands at $13.6 million per person ($27.2 million per couple), meaning the vast majority of ultra-wealthy estates pay nothing. The effective estate tax rate on the very largest fortunes is a fraction of what it once was. The 2017 Tax Cuts and Jobs Act nearly doubled the exemption threshold. The 2025 tax bill extended those provisions.

Research by economists Emmanuel Saez and Gabriel Zucman found that the richest 400 families in the U.S. pay an effective tax rate of roughly 23% — more than a percentage point lower than the 24.2% paid by the bottom half of American households. The estate tax is one of the few tools designed to interrupt the intergenerational compounding of extreme wealth.

The federal minimum wage has been $7.25 per hour since July 24, 2009 — the longest stretch without an increase since the minimum wage was first established in 1938. In that same period, worker productivity has continued to rise, corporate profits have hit record highs, and CEO compensation has soared. The workers doing the work have not shared in what their work produced.

If the minimum wage had kept pace with productivity growth since 1968 — when the relationship between wages and productivity was still intact — it would be approximately $26 per hour today. That is not a proposal. It is what workers were already effectively paid at the peak of the post-war economy. The disconnect since then represents a deliberate policy choice to let employers capture productivity gains rather than share them with workers.

Indexing the minimum wage to productivity or to median wage growth would prevent this from happening again. It would mean that as the economy grows, the floor grows with it — not by legislative act every decade or two, but automatically, as a matter of design.

A wealth tax — an annual tax on net worth above a very high threshold, not on income — addresses what income taxes and capital gains taxes cannot: the compound growth of already-enormous fortunes. When wealth generates returns that are reinvested rather than realized as income, it can grow indefinitely without ever being subject to meaningful taxation. That is the mechanism by which a small group of people has come to hold more wealth than the bottom half of the country combined.

Proposals for an Ultra-Millionaire Tax — applying a 2% annual tax on net worth above $50 million and 3% on net worth above $1 billion — have been estimated to raise approximately $2.2 trillion over ten years, according to Tax Policy Center analysis. Administrative challenges are real and worth taking seriously — valuing illiquid assets like private businesses is genuinely difficult — but these are engineering problems, not principled objections. The estate tax faces similar valuation challenges and has functioned for decades.

Wealth taxes exist and function in Norway, Spain, Switzerland, and other countries. The argument that they are impossible to implement is a lobbying position, not an economic fact.

The statutory federal corporate tax rate is 21%. Most large corporations pay significantly less. In 2025, Amazon, Alphabet, Meta, and Tesla — whose CEOs flanked President Trump at his inauguration ceremony — collectively reported $315 billion in U.S. profits and paid just 4.9% of that in federal income taxes. Their collective tax avoidance amounted to $51 billion in a single year, much of it enabled by the 2017 Trump tax cuts and the 2025 One Big Beautiful Bill Act.

Tesla is the sharpest example. The company reported $5.7 billion in U.S. income in 2025 and paid exactly zero federal income tax. Over three years, Tesla reported $12.5 billion in U.S. income and paid $48 million in taxes — an effective rate of 0.4%. This was accomplished legally, through accelerated depreciation, executive stock option deductions, and tax credits. Nothing about it was illegal. That is precisely the problem.

The mechanisms are specific: accelerated depreciation lets corporations write off equipment costs immediately rather than over time, reducing taxable income in profitable years. Stock option deductions allow companies to deduct the difference between what executives pay for stock options and what those options are worth. Offshore profit shifting parks income in low-tax jurisdictions. Each loophole was written into law through a lobbying process that most people never see.

Source: Institute on Taxation and Economic Policy (ITEP), a nonpartisan tax policy organization. Their Corporate Tax Watch tracker documents current-year tax avoidance by major corporations. itep.org/corporate-tax-avoidance ↗