The way the U.S. government taxes capital gains makes little sense. That in itself is not surprising. But it is counter-productive when it comes to long-term capital formation.

An entrepreneur who devotes his entire life to building a company gets taxed at the same rate as a hedge fund manager who makes a long-term investment for 366 days. I realize that 366 days is a really long-term investment for George Soros, John Paulson or Paul Tudor Jones.

The tax rate for the same investment horizon applies to an ordinary investor who buys GE or Intel for 366 days. It also applies to an employee who goes to work for a public company, spends decades there helping the company grow and decides to purchase its shares because she believes in its future, not simply as a declaration of confidence.

But I've often thought there is a world of difference between someone who holds a stock for a year and someone who creates a business or helps it grow over an extended time period. Hell, I think someone who holds Walgreen's shares for a decade deserves more than someone who holds CVS for a year, but that's a more tenuous argument.

So when I read Jim McTague's column in the current September 6 issue of Barron's, it was pleasing to find that I was not alone.

McTague interviews Mark Bloomfield, president of a DC-based organization dubbed the American Council For Capital Formation. Bloomfield is promoting something called a sliding capital tax rate schedule, that was instituted by FDR of all people, that gradually reduced taxes on investments the longer the holding period.

Does it have a chance? Probably not. It makes too much sense.