Whalen Global Advisors' Christopher Whalen reacts to the Harris plan to tax unrealized capital gains

online at 560 fans.com now from the Signature Bank Studios this is Chicago's morning answer with Dan proft and Amy Jacobson an am560 the [Music] [Music] answer top of the morning Dan and infamy this morning is is Charles Thomas for ABC7 political reporter yep that's you that's you and uh Charles um uh the uh kinomics plan it's real uh not just the um price controls to combat price uh G gag gaging yeah I want to say it right U but also um this uh remarkable proposal that has been ridiculed uh every other time it's been brought up but um not this time because obviously we have a serious thinker who's promulgating it now talking about the unrealized capital gains tax that uh kamla suggests she wants to impose and by the way the idea that it would oh that's never going to happen oh that's not unconstitutional there are a lot of things that are never going to happen that happen there are a lot of things that are unconstitutional that are backed by the force of law at present so I wouldn't be so quick to dismiss ideas just because they're ridiculous we live in increasingly ridiculous times and remember the left's position as so nicely articulated by the head of the human rights uh campaign a kamla Ally we need to be more revolutionary than um what the founders wrote in that little piece of white paper so uh enter Kamala econ adviser Barat Rama who was on CNBC with Joe kernin and Becky quick to defend said proposal unrealized gains taxing unrealized Gams just doesn't seem fair in any sense of the word in the very best in the very best sense if you were taxing unrealized gains all you're doing is pulling forward the taxes that would be paid later when someone actually sells the stock I I I I think that this reaction to unrealized gains is a little funny given that I bet that the majority of people watching right now are already paying a tax on unrealized gains it's called a property tax when the value of your home goes up TA when the value of your home goes up you pay higher taxes even if you don't sell your home value of your home never moves the way stock moves the way something go to answer it's also property tax is a use tax you're paying for school for the schools you're paying for emergency services those are things that make absolute sense and and sure and all the all the revenue that comes in from these unrealized gains taxes and the other taxes in the tax in the Harris plan are going to go to what creating what she calls more opportunity it's to make sure that every newor born in this country get $6,000 the services well look I I you're you're arguing that this is some sort of foreign concept that's completely uh unknown probably unconstitutional it's probably and it was never in in anyone's intent to it's not an income tax and it's never going to happen probably not in not well my I'm not going to say my lifetime I wouldn't say that not in Becky's lifetime uh I wouldn't giggle about it I do share kernan's exhaustion with this uh Trope uh we already pay uh unrealized capital gains taxes called your property taxes um I think Becky quick did a pretty good job of responding there for more on this and other matters Financial pleased to be joined by Christopher whan investment banker and chairman of whan Global advisers also the author of Fordman from inspiration to Enterprise and editor for the institutional risk analyst Chris whan thanks for joining us appreciate it good morning Dan good morning Charles good morning uh so um you want to take a whack at uh the unrealized capital gains tax proposal well it's aspirational politics I I think Becky did a great job pushing back um the left in this country has you know left the bounds of Earth they will propose anything that they think will get them traction with voters and since half of all voters are basically living paycheck to paycheck and don't have a lot of money in the bank uh it is more appealing now than it has been in the past I'm in the middle of editing my uh re-release of my first book and you know this last 15 years has been really strange nobody would have imagined some of the proposals that come out of all all different points of the compass politically that we've seen in the last 15 years so the Democrats shouldn't surprise you that they're coming up with such crazy ideas um because this is just where they're headed you know you saw it with Kennedy when he uh endorsed Trump he said my father my grandfather and my dad was biographer of Joe Kennedy uh would not recognize his party because of the ideas they keep espousing so you know I think Cala is going to Force everybody in the country everybody in the business Community to oppose her that's essentially what she's doing because she's so far out there that even a a left of center business person uh is going to have trouble supporting her um so I mean just just to give us a little bit of a scenario from your perspective I mean if a unrealized capital gains tax was passed say I think she's proposed 21% 21% 15% 10% 10% 30% whatever what would the uh the consequences be I think you would probably see people selling um I also think it would increase the tendency for wealthy Americans to move offshore uh simply because they can see the writing on the wall if you're a very wealthy person um you're probably already shopping for offshore domiciles to shelter you from the craziness in American politics you know real historians know that we've had periods of very intense socialism in this country and I think we're heading back there if you think about the early part of the 19 20th century you know the 20s particularly we had some really nasty socialists uh these were the people who ended up teaching the likes of Barack Obama and others so it's not like this is new it's not it's just that it's come back in the age of affluence in the age when we can borrow money endlessly or we think we can borrow money endlessly right Dan uh but no they this is going to come to an end we're we're one bad treasury auction away from the wakeup call you know it's like we're all asleep right now having this really strange dream something out of the house of dragons or something and now the bell's going to ring and the FED will have to buy an entire treasury auction I'm starting I'm starting to think that Elon Musk might be on something and that we're all in one big simulation yes that's I totally agree I can't I'm like poking my hand to see if I I really feel it um the but there's such a difference between the perception of people inide Washington and the rest of the country when it comes to economics it's striking J Jared Bernstein is still trying to figure out why the government borrows money in the first place uh you know Biden's top economic adviser well it's like a eight track tape it goes round and round you know you know and and I'm not here to Flack for the uber wealthy because they got plenty of flaks um but but the you know the idea that you can run from this you know where where exactly are you going to run too and by the way they they will chase you when you run California kamla's home state there I mean that they're they were kicking around an exit attacks to chase you down for um essentially um clawing back money you made while you were in California when our laugher moves New York too New York is headed in that direction of course they are and and and then and then they'll impose a federal wealth tax I mean the and and is everybody going to live in um uh you know Bermuda or the Antilles I mean at some point you have to stand and fight I think uh I totally agree with you I'm not going anywhere but Hamilton is very attractive to many people yeah us law you know it's not one of the crazy Islands down south it's actually a respectable venue so you'll see more in more of that but I I think ultimately these things come in Cycles this is the end of the baby boom party it's like a you know a 40e long keg party on the beach and now we're kind of done and we're going to have to figure out a way to run the country in a reasonable way uh without world wars and other kinds of disturbances I remember Freeman Dyson who I got to meet a couple of times at Princeton used to say we're really good at replication but we're still working on metabolism and I think that was one of the more interesting insights I've ever heard about economics yeah we're uh at the end of this keg party and Anette fella looks like hell uh Chris you know what I I have hope because you know I'm I'm a trump supporter and I think that Camala Harris who does not exist politically she has zero political image or you know recognition in this country and I think she's going to basically campaign herself into into a defeat uh they really you know the media is so skewed as you know Dan but unfortunately the the left cadres who follow Kamala they listen to the media too so they don't know about immigration they don't know about inflation they don't know about the cost of housing these are the three issues that will decide to select it won't be Reproductive Rights and it won't be any of the rest of this nonsense you know $25,000 for a starter home that's not going to move the needle that's not what people want to hear right now 150 if you're an illegal immigrant in California no but she's gonna she is going to force the entire business Community to run against her if she really goes out with you know taxes on unrealized gains forget about it forget you know the corporates in this country believe it or not still have a lot of power and people like Warren Buffett still have a lot of power that's why they started ordering Cala around remember that one guy who had written her a big check and then ordered her to fire the head of the FTC yeah right well well yeah that's that's crony capitalism I wrote a piece about this for American conservative years ago so well no I mean Chris Cuomo's Moment of clarity on the floor of the DNC last week where he's look pointing up at all the corporate sweets they paid half a million a million bucks including the corporate media to have these sweets to have access so you have these uh new Bolshevik like comrade Bernie and everybody else railing against the billionaires and the the corporate Titans and so on and so forth meanwhile they're literally looking down at them like Caesar uh watching it all play out and the the the I mean the joke is on anybody who doesn't see the rent seeking the uh Cron ISM that you're talking about well no precisely these are you know if you think about it and and I don't mean this as a as a criticism but most big companies today are run by managers these are people that don't generally have large Equity stakes in the business they didn't start the business and likewise on the left you see these functionaries these little paper pushers who go to meetings and you know give press conferences but they have no substance and I say this as someone who is worked in finance during the Biden Administration I have interacted with all the major agencies in Washington that do money and they are largely incompetent I I really say that honestly they don't understand what the hell they're talking about so sooner or later they're going to crash and burn Dan that's it you know God help us if Camala wins oh my God this is going to be scary that's that was uh that was a pretty that was a pretty close approximation of gecko's tar paper rant uh not not not bad um you know what about folding in Tim Walls to the conversation too don't foret about Coach walls um it's fascinating the worst governed states in America uh the states that are performing the worst economically are the uh breeding ground for National politicians for this new bulvik party Minnesota ranks 46th of the nation for per capita GDP 47th for job creation you know pritzer was a finalist Illinois is the worst of the nation and everything California is maybe a tick ahead New York Kathy hokel was uh seen and heard from I mean this is this is their bench this is this this is their star All-Star lineup all the all the people who Lord over states that are dumpster fires well nothing's changed youall uh Al Smith how many times did poor Al run uh and and similarly today they didn't have a candidate other than Biden and now Camala Harris has been thrown in there but think about the fact that even though the Democratic party is run by Bosses just like the Republican party used to be a century ago rank these people still can't organize themselves to pick a decent candidate who's in his 40s or 50s they just can't do it it's it's really quite striking if you think about it it's not just the state stand as a group this they don't have any acceptable attractive candidates yeah it's it's like the Illinois Republican party Charles kind of maybe they should put Cala in a wheelchair that would help you know be it be just like Franklin but you know Franklin was so conservative compared to these people I keep thinking about uh Robert Kennedy's comments uh it's night and day these aren't just European socialists they're to the left of most people in Europe and that's why I don't think they're going to do well at the pulse I really don't you know RFK Jr is an inter interesting figure um I mean he says a lot of things that um that I agree with and I think that are pretty good insights and of course he's been on the inside of this for a long time I I I don't you know go fully down the path with him on certain issues but I I wonder what your take on him is from a you know business uh perspective not a big fan of corporate America as you will know and um and you know to the extent that he is more than just a figurehead on a trump trans I team but it has any influence in a trump uh second term what's your perspective on that well he's clearly turned off by big Corporate America which is not hard to do especially if you focus on Healthcare and related issues that is not a pretty picture uh but at the same time you know we don't yet have a consensus among conservatives to use antitrust we keep thinking oh well we can't you know uh uh contradict the great corporate Titans no yes we can there are a lot of combinations out there that are driven by private Equity that make no sense and then later we see the the destruction and the detrius from the collapse you know how many companies have we seen gone bankrupt after the bankers have taken all the capital out I have a problem with that so you know I think Robert Kennedy has some interesting things to say but it's uh it's not 100% a conservative message by no no understood yeah just was curious um Christopher whan investment banker and chairman of whan global advisers author of Fordman from inspiration Enterprise and editor for the institutional risk analyst Chris whan thanks as always for joining us appreciate it have a great holiday guys you too and he joined us on the turkey. pro answer line it's what Chicago is talking about it's 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