> naive to the point of absurdity, when the rich and powerful quite often are gifted loopholes for the profits to not be taxable

This is not how I read OP. You’re reading a Panglossian “we’re in the best of all worlds.” I read we’ve found a good solution, but it’s a work in progress.

Democracy alone has evolved through the centuries, ranging from electoral fetishism to enlightened autocracy. Progressive taxation, meanwhile, is a mostly modern invention. Yes, it’s easier to take a cheap shot at how the rich are powerful, but that’s OP’s other point, the rich are always powerful. How they are incentivised to use that power, and how they accumulate it, is a much more productive (and intellectually challenging) discussion than pointing out we aren’t in a utopia. (We know that. Everyone knows that.)