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us department of the treasury
‘These Guys Can’t Help Themselves’: Cruz Pushes $200 Billion Capital Gains Tax Cut Without OK From Congress
Republican senators said they were seeking to end an "unfair inflation tax on everyday Americans." But nearly all the benefits of their proposal would go to the wealthiest 1%.
Mar 03, 2026
Two leading Republicans are pushing for the Trump administration to issue another $200 billion tax cut, primarily to the wealthiest Americans, without congressional approval.
The Washington Post reported Tuesday that Sens. Ted Cruz (R-Texas) and Tim Scott (R-SC) sent a letter to Treasury Secretary Scott Bessent urging him to use executive authority to lower the federal tax on capital gains—the profits from selling stocks, bonds, real estate, and other investments.
The senators have proposed that capital gains taxes should be “indexed for inflation." As the Post explained:
The plan pushed by Cruz and Scott has been sought by conservatives for many years. Under current law, an investor who bought $100 worth of stock in 1990 and sold it today for $300 would currently owe capital gains taxes on the full $200 in profit. But the $100 investment in 1990 would be worth roughly $230 in today’s dollars after accounting for inflation. Under the Cruz-Scott proposal, the investor would only owe taxes on that $70, rather than the full $200.
The senators called on Bessent to "eliminate" this "unfair inflation tax on everyday Americans."
According to Federal Reserve data from 2025, the richest 1% of Americans owned about half of all stocks, while the poorest 50% owned only 1%.
Republicans' so-called One Big Beautiful Bill Act (OBBBA), which enacted massive cuts to social programs like Medicaid and the Supplemental Nutrition Assistance Program (SNAP) last summer, is already estimated to funnel more than $1 trillion to the top 1% of earners over the next 10 years, according to the Institute on Taxation and Economic Policy.
It is unclear whether Bessent would even have the power to change how gains are taxed without an act of Congress, or if Bessent has any interest in doing so. But the vast majority of the benefits from Cruz and Scott's proposal, if enacted, would likely go to the rich as well.
When the Trump administration first considered indexing capital gains taxes to inflation back in 2018, the Penn Wharton Budget Model projected that 63% of the benefits would flow to the richest 0.1%—those making tens of millions per year—while 86% would go to the top 1%.
Those in the bottom 90% of earners would see just over 2% of the overall benefits, with those in the bottom half receiving basically nothing.
According to the Post, the senators view lowering capital gains taxes as part of a GOP bid to "improve its economic approval rating with voters ahead of the 2026 midterm elections," in which the party is expected to take a walloping, according to current polls.
Voters have not responded kindly to previous bills that handed lavish tax breaks to the rich. At the time of its passage, the OBBBA was one of the least popular pieces of legislation in modern history, with several polls showing nearly a 2-to-1 disapproval rating.
But Cruz and Scott are pushing for this policy change despite the public revulsion and the fact that the Department of Justice has previously ruled that the Treasury Department can't make policy without Congress' approval.
"Ted Cruz is asking the Treasury Department to break the law to give another round of tax breaks to the ultrarich," remarked Sen. Ron Wyden (D-Ore.), the ranking member of the Senate Finance Committee. "These guys can't help themselves."
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Ex-Officials, Watchdogs Rip Trump Effort to 'Bully' IRS Into Giving Him $10 Billion in Taxpayer Dollars
"Our government should be accountable to the people, not the whims of a power-hungry executive," said one Common Cause campaigner.
Feb 05, 2026
Less than a week after a court filing revealed that President Donald Trump is suing his own Treasury Department and Internal Revenue Service for $10 billion over the leak of his tax returns during his first term, former federal officials and watchdog groups on Thursday called out his attempt to abuse "powerful tools for holding government accountable."
The legal group Democracy Forward filed a friend-of-the-court brief on behalf of Common Cause, the Project On Government Oversight, ex-IRS Commissioner John Koskinen, former National Taxpayer Advocate Nina Olson, and Kathryn Keneally and Gilbert Rothenberg, who both held leadership roles in the US Department of Justice's Tax Division.
"This case is extraordinary because the president controls both sides of the litigation, which raises the prospect of collusive litigation tactics," states the amicus brief. "Collusive litigation threatens the integrity of the judicial process by risking the court's entanglement in an illegitimate proceeding. And although the complaint has significant defects—it was filed too late, against the wrong party, and for an unsupported and excessive sum of damages—the conflicts of interest make it uncertain whether the Department of Justice will zealously defend the public fisc in the same way that it has against other plaintiffs claiming damages for related events."
"To maintain the integrity of the judicial process in the face of these highly irregular circumstances, the court should consider exercising its inherent judicial authority to proactively manage this case from the outset," argued the former officials and groups, known as amici. Specifically, they said:
- First, the court should consider issuing an order for the parties: to show cause why this court has jurisdiction over this case, to explain how they will address the fundamental conflict-of-interest problems with this case, to show why this case should not be stayed until after President Trump leaves office, and to show why the unjustified $10 billion damage figure should not be stricken from the pleadings;
- Second, the court should consider appointing amici who have expertise on issues of tax law and separation-of-powers issues to present fulsome legal arguments on all future issues that arise in this case; and
- Third, the court should consider allowing participation of those amici in hearings.
"To treat this case like business as usual," the coalition declared, "would threaten the integrity of the justice system and the important taxpayer and privacy protections at the heart of this case."
In a statement about the new filing in the Southern District of Florida, Abigail Bellows, Common Cause's senior policy director for anti-corruption and accountability, stressed that "we are watching a president attempt to bully the IRS into giving him billions of our taxpayer dollars."
"Our government should be accountable to the people, not the whims of a power-hungry executive," Bellows said. "We urge the court to take steps to promote judicial integrity and protect the public interest."
President Trump has made $4 billion since his second inauguration. And now, he's suing the Treasury Department and IRS for $10 billion more in "damages."So we're filing a brief urging the court to reject President Trump’s scheme and protect taxpayers.
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— Democracy Forward (@democracyforward.org) February 5, 2026 at 5:37 PM
In addition to representing the amici in this case, Democracy Forward has launched various other lawsuits against Trump and his administration, which have faced sweeping allegations of corruption since the president returned to power a year ago.
According to an analysis published by the New York Times editorial board last month, on the one-year anniversary of his second inauguration, Trump and his family enriched themselves to the tune of at least $1.4 billion during the first year of his second term—largely through investment in cryptocurrencies, though he's also secured settlements from tech and media companies.
Various other members of the second Trump administration have also been accused of corruption and conflicts of interest, and as the Times separately revealed in December, many rich and powerful contributors to Trump's post-election fundraising haul have received corporate-friendly regulatory changes, dropped enforcement cases, government contracts, and even pardons.
"The president's corruption continues, this time in an attempt to take $10 billion dollars of the taxpayers' money, which threatens to make a mockery out of our justice system," said Democracy Forward president and CEO Skye Perryman. "Not only does the president's baseless case have significant legal defects, but there are colossal conflicts of interest at play."
"We thank these experts for raising these serious concerns about how President Trump is seeking to further illegally line his own pockets at the public’s expense and our brief urges the court to exercise its power to ensure the matter is not one-sided."
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Scott Bessent’s Tragic Transformation
Instead of a principled voice for sound economic policies and principles, Bessent has become a cheerleader for Trump’s dubious financial moves.
Jan 22, 2026
Treasury Secretary Scott Bessent’s job is to calm the economic fears that President Donald Trump creates. He has followed a curious journey to get there, and now he’s sacrificing his integrity and legacy to remain.
Stage 1: Democratic Fundraiser
Born in a small South Carolina town, Bessent, 63, graduated from Yale College in 1984 with a bachelor’s degree in political science. Eventually he went to work for Soros Fund Management—founded by the Republicans’ favorite Democratic demon, George Soros.
Bessent is openly gay, married since 2011 to a former New York City prosecutor, and has been a strong advocate for gay rights and marriage equality. In 2000, he supported Democratic presidential candidate Al Gore, co-hosting a fundraiser for him in East Hampton, New York. He donated $2,300 to Barack Obama’s campaign in 2007. Although he donated $25,000 to support Hillary Clinton’s presidential aspirations, by then he was a major donor to Republican candidates.
Stage 2: Republican Oligarch
Bessent returned to work for Soros in 2011 as chief investment officer but left in 2016 to form his own fund for which Soros provided a $2 billion anchor. From 2018 through 2021, as the global stock market broke records, the performance of Bessent’s fund was mediocre. Still, he amassed an estimated wealth of $600 million, although some reports refer to him as one of “Trump’s billionaires.”
Bessent and his husband have two children studying in Europe. As they process the European reaction to Trump, they may ask him what he is doing to make the world a better place.
Bessent donated $1 million to Trump’s inauguration in 2016, but was not part of the first term’s inner circle. When Trump left office in disgrace after January 6 and under the cloud of other legal woes, most business leaders were reluctant to support him publicly. But as Bessent said on Roger Stone’s radio show in 2024: “I was all in for President Trump. I was one of the few Wall Street people backing him.”
The 68 senators who voted to confirm Bessent as Treasury secretary probably hoped that, like Marco Rubio at the State Department, Bessent would be an “adult in the room.” Unlike other members of the clown car comprising Trump’s cabinet, Bessent would save the nation from Trump’s worst financial impulses.
After all, the country has never had a president who declared bankruptcy six times (although Trump told the Washington Post that he had only four because he counted the first three bankruptcies as one).
Stage 3 :Trump Sycophant
Instead of a principled voice for sound economic policies and principles, Bessent has become a cheerleader for Trump’s dubious financial moves. At times, he has resorted to rhetorical gymnastics to explain away Trump’s plain language. For example:
- On April 2, 2025, on what Trump called “Liberation Day,” the president announced his first round of universal tariffs. The thoughtless imposition of across-the-board tariffs was often nonsensical, such as tariffs on uninhabited islands near Antarctica and on countries with which the US has a trade surplus. Trump sent global markets into a tailspin and US interest rates upward. Five days later, Bessent admitted that he was surprised by the “impatience” of commentators and the financial markets. He tried to stop the carnage by saying that Trump’s bizarre action was simply a clever negotiating strategy—which made little sense to the penguins of Antarctica.
- In September, as major US companies announced the loss of billions of dollars resulting from Trump’s tariffs, Bessent dismissed their concerns.
- Bessent—who is not an economist—has parroted the Trump line that tariffs are not a tax on American businesses and consumers because foreign exporters bear the cost. A broad consensus of economists has concluded otherwise, and a major study released on January 19 found that consumers and businesses—not foreign exporters—bear 96% of tariff costs.
- As Trump touted tariffs as a boon to manufacturing, Bessent acknowledged that the US has been losing manufacturing jobs. But he insists that better days are coming.
- When Trump tried to fire Federal Reserve Board Governor Lisa Cook, Bessent said that the Fed’s independence was important, but that Trump had the right to fire her. After reportedly trying to persuade Trump not to fire Fed Chair Jerome Powell, Bessent has now become one of Powell’s most vocal attackers—along with Trump’s Justice Department.
- When the US Supreme Court heard oral argument in the case challenging Trump’s tariffs, Bessent sat in the front row. Now he’s criticizing Powell’s decision to attend the oral argument in Cook’s case.
- Most recently, Trump blamed his threat of a global trade war on Denmark’s refusal to let the US take over its longstanding territory, Greenland. In a social media post on Saturday morning, January 17, Trump announced new 10% tariffs on Denmark and the countries who stood with it in resisting Trump’s demand: Norway, Sweden, France, Germany, Britain, the Netherlands, and Finland, effective February 1. He threatened to increase the levies to 25% on June 1, unless Europe capitulated.
- Sunday evening, January 18, NPR’s Nick Schifrin posted a letter that Trump had previously sent to Norway’s prime minister, Jonas Gahr Støre. Trump revealed that after not winning last year’s Nobel Peace Prize “for having stopped 8 Wars PLUS,” he “no longer feel[s] an obligation to think purely of Peace, although it will always be predominant, but can now think about what is good and proper for the United States of America… The World is not secure unless we have Complete and Total Control of Greenland.”
- Hours after the public disclosure of Trump’s message, Bessent held an impromptu press conference on the sidelines of the World Economic Forum in Davos, Switzerland. He tried to explain away Trump’s childish fit: “I think it’s a complete canard that the president will be doing this because of the Nobel Prize,” Bessent asserted. Accusing Trump’s critics of “hysteria,” Bessent said, “What I am urging everyone here to do is sit back, take a deep breath, and let things play out.” His words fell flat, and he looked as uncomfortable as he must have felt.
- In Brussels on January 21, the European Parliament protested Trump’s demand by suspending its work on the previously negotiated US-EU trade deal. Meanwhile at Davos, Trump delivered a 90-minute screed that insulted many European leaders by name and reiterated his demand for Greenland. But later that day, Trump posted that he and NATO Secretary General Mark Rutte had worked out a “framework of a future deal with respect to Greenland and, in fact, the entire Arctic Region.” And he walked back the new European tariffs he’d threatened to impose on February 1.
Stage 4: The Coming Quest for Rehabilitation
Bessent seems destined to follow the paths of other Trump enablers who eventually left the fold, like former Attorney General William Barr. He neutered the Mueller Report on Russian election interference during the 2016 election, only to resign 18 months later as January 6 approached. Eventually, Bessent will find himself on the outs with Trump, write a book, pursue a public speaking “redemption tour,” and explain that his government service saved the country from Trump’s worst impulses.
Such a rationalization rings hollow.
Bessent and his husband have two children studying in Europe. As they process the European reaction to Trump, they may ask him what he is doing to make the world a better place. The answer is also his legacy: In the process of sacrificing his personal integrity, Bessent has disserved the nation.
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