President Obama is taking on Wall Street again.
After sending his 2015 fiscal year budget to Congress, President Obama said he planned to close tax loopholes benefiting the rich.
"Closing tax loopholes that, right now, only benefit the well-off and well-connected," Obama said.
Obama has often called on Congress to close tax loopholes including the carried interest loophole, which he promised to close during his first campaign.
The idea of closing this loophole has appeared in President Obama's budgets over and over, but it never makes it to the final draft.
Erin Burnett thinks the carried interest loophole is "one of the most ridiculous tax loopholes in America."
It has netted billions of dollars for a very select few Americans.
It's the loophole that gives loopholes a bad name, and makes arguments of special treatment hold up.
Burnett explains how it works:
OutFront: Democratic Congressman Brad Sherman - he sits on the House Financial Services Committee. He is also a Certified Public Accountant.
World financial markets fell sharply as the crisis in Ukraine escalated.
The Dow Jones Industrial Average dropped 153 points, oil prices spiked by nearly $2 a barrel and the ruble plunged.
The already weak Russian currency fell as much as 3% versus the U.S. dollar before posting a small recovery. Joining us tonight to talk about why the markets are tumbling is Peter Costa, President of Empire Executions.
The GOP is taking on wall street.
Republicans want to close one of the most ridiculous tax loopholes in America known as "carried interest."
As part of a major tax code overhaul, Republican House Ways and Means Chairman Dave Camp said Wednesday he will close a loophole that has netted the top Americans billions of dollars.
According to the Joint Committee on Taxation, they would pay billions of dollars over the next decade if the loophole was closed.
At a time when every dollar counts, some would there'd be celebration on Capitol Hill.
But Republicans and Democrats have been afraid of challenging these business titans and their lobbyists.
House Speaker John Boehner was asked about carried interest on the Hill today. His response? "Blah, blah, blah," before going on to say the plan is "the beginning of [a] conversation" lawmakers need to have about tax reform.
President Obama is also guilty of caving to lobbyist pressure. He promised to close the loophole in 2007, and it's still wide open.
The loophole allows these people to pay half the taxes they would otherwise. They currently pay a tax rate of 20%, but their regular income tax rate would top out around 35% under Camp's plan.
Some loopholes make sense. Camp's plan has a few supporters, but not many.
Erin Burnett explains why:
When you're a partner in a private equity firm, you get a cut of the profits you make from investing other people's money. Usually, it's a 20 percent cut.
If you invest money with one of these men and your investment goes up in value, they get to keep a cut of the profits. Now, it's your money that was put at risk. While you get to pay the lower capital gains rate of 20% so do the guys, who simply manage your money. And their cut of the profits is a huge part of the money they earn.
Both parties get to pay the lower rate provided to Americans to encourage people to take risk - except it's not their money and it's not their risk.
They get to pay 20% on what is essentially their wages. Everyone else's wages are taxed at an ordinary income tax rate.
Burnett asks Michael Farr, Author of "Restoring Our American Dream: The Best Investment," whether he thinks the tax reform will actually happen.
"What I'm hearing from my friend Greg Valliere at Potomac research is that the Republicans don't want to touch much of this a minute before they have to and certainly not before the mid-term election," says Farr. "I think something could happen but I think it's going to take a while."
Almost half of the world's wealth is now owned by just one percent of the population, according to a recent Credit Suisse report.
How does that happen?
Well, Billionaire real estate investor Sam Zell thinks one percent just works harder.
"The 1 percent are getting pummeled because it's politically convenient to do so," Zell said. "The problem is that the world and this country should not talk about envy of the 1 percent, they should talk about emulating the 1 percent. The 1 percent work harder, the 1 percent are much bigger factors in all forms of our society."
Zell was responding to the now-infamous comments by venture capitalist Tom Perkins. In a letter to the Wall Street Journal, Perkins wrote:
"I would call attention to the parallels of fascist Nazi Germany to its war on its 'one percent' namely its Jews, to the progressive war on the American one percent, namely the 'rich.'"
Perkins later apologized for comparing today's treatment of the wealthy to the persecution of Jews in Nazi Germany.
But he's still standing by his message of class warfare.
OutFront: Democratic Strategist Paul Begala and Conservative Columnist Reihan Salam.
The Dow tumbled more than 300 points Monday afternoon, or almost 2%, after a much worse-than-expected reading on manufacturing activity. The S&P 500 and Nasdaq were down more than 2%.
Companies like Microsoft and G.E. were also down 3 percent. And AT&T fell more than 4 percent. So far this year, the Dow is down 1,200 points.
OutFront: Brent Wilsey, President of Wilsey Asset Management.