The evil Biden is taking buybacks from investors. But he's not getting anywhere.

The US president has proposed quadrupling the tax on corporate share buybacks. However, the US market doesn't seem to be scared off by the idea at all. No one seems to believe that the president can get it through Congress.

Has he succeeded before? Yes, in August 2022 Biden was able to pass a 1% share buy-back tax bill. But even then it succeeded with difficulty. And last year both the House of Representatives and the Senate were Democratic. Now the House is occupied by Republicans who were all against this tax in August.

What's more, when Kirsten Sinema switched to independents, the Democrats lost their majority in the Senate too. Going back to August again, it took Democrats a long time to get Sinema to approve the buy-back tax. Not only that: they had to make concessions by lowering the rate from 2% to 1%.

So it turns out that Biden is incapable of repeating his "summer trick".

Why would he do that in the first place? He seems to want to force companies to invest in their growth rather than their shareholders. Besides, buybacks can be a tool to artificially inflate share prices, and distract from real business problems. And underinvestment is dangerous for entire industries, as the US oil industry famously demonstrated last year.

Of course, bybacks are also useful because they boost investor confidence and attract more investment. But it can also be an instrument of speculation: It is much easier to "dump" one's shares while "swallowing" government subsidies than to do real business.