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Senator Ron Wyden Endangers Tax Reform With Hire of Radical Partisan Victor Fleischer

While most Americans over the past two weeks were consumed with the drama and intrigue of the two party conventions, a major hire was made in Washington, D.C. which could have devastating negative implications for fundamental tax reform prospects in 2017.

Senate Finance Committee Ranking Member Ron Wyden (D-Ore.) has hired University of San Diego law professor Victor Fleischer as co-chief tax counsel. Should the Democrats gain a majority in the Senate this fall, Fleischer would have a key role in shaping the direction of tax reform discussions next year with the new president and with a presumably Republican House of Representatives. Wyden called Fleischer a “true outside thought leader in this space.”

That is very bad news if you were hoping to see fundamental tax reform finally become a reality next year.

Fleischer is a radical partisan of the highest order. The best analogy for him is that he is to tax reform what Elizabeth Warren is to financial services reform–an academic who has aligned himself with the outer fringes of the leftist coalition in order to push extreme policy measures in his area.

Fleischer’s main claim to fame is his proposal to tax capital gains earned by managing partners in investment partnerships (“carried interest” capital gains) as ordinary income. This ignited a round of tax increase fights here back in the latter years of the George W. Bush administration.