Why couldn't you write a rule specifically for that? E.g. if it's your own capital, it's the capital gains rate, if it's somebody else's capital it's income.
of course, you can. If you can pass laws, but in the US it's very hard to pass law these days. Ergo, all the fighting over Supreme Court appointees.
Fine, but how do you do that without keeping the carried interest loophole that just won't go away regardless of which party is in power.