Why? I didn't say he should be taxed on unrealized capital gains. I don't realize most of my own capital gains in any given year and certainly don't want to be taxed on them, either. If it was up to me, there wouldn't be a capital gains tax or a corporate income tax at all (maybe keep the punitive short-term rate to discourage day-trading and encourage true corporate governance and owners that care about long-term performance). I cite Haig-Simons simply because it's the best indication of one's ability to pay.
But I still think there's something to his general sentiment that the percentage one pays of actual realized income should not decrease as you earn more. It doesn't for wage and salary earners, but our tax system as it stands is severely tilted in favor of owners (you could make a good argument that no one would buy preferred stock at all if not for the corporate-to-corporate dividend loophole, for instance, which is just individual taxpayers subsidizing the borrowing costs of corporations).
I get that we want to encourage people to invest and take risk, but our tax code also allows people to shelter a whole lot of what they earn without using that money the way the tax code intends if you want to take a charitable interpretation of the intent. Why exempt municipal debt interest from personal income tax, for instance? It's meant to subsidize infrastructure development at the city and state level, but the full area under the demand curve to the left of the equilibrium rate is wasted money in excess of just straightforwardly transferring tax revenue from the federal government to municipalities, rather than giving rich people another way to earn income without being taxed and encouraging cities to borrow more money than they would otherwise be able to. I don't necessarily support a straight punitive wealth tax like some uber-AMT to make sure millionaires aren't paying less than secretaries, but get rid of some of these deductions. Hell, get rid of mortgage interest deduction. It's my own personal largest source of avoiding taxes, but it's still economically stupid. We want to figure out who to blame for the housing collapse and want to talk about Fannie and Freddie guaranteeing loans and bond-raters misjudging MBS risk. What about the government paying half your mortgage in the first few years? What do you think that does to demand and the rate of price appreciation? How do you think that encouraged the creation of initial interest-only ARMs?