As some of you are aware, the bulk of hedge fund managers’ income is taxed at the capital gains rate of 15%, rather than the 35% on amounts in the 6+ figure range that mere mortals pay.

Basically, they get a slice of the increase in price of their assets, even though they never put a dime of their own money in. It’s called “Carried Interest.”

Well, it appears that both Max Baucus (DINO-MT), who slowed down healthcare refiorm waiting for non-existent republicans to come on board, and Barack Obama’s Director of the Office of Management and Budget, Peter Orzag, have decided that it would be a good think to put a stake through the heart of this loophole in the interest of deficit reduction.

The money quote is this:

Hedge fund managers make hundreds of millions of dollars (and often billions) annually. Does anyone really think they will suddenly slam on the brakes if they have to pay the same tax rate as the janitors who clean their offices?

This makes this both good policy and good politics………For the win.