Calvin H. Johnson (Texas) has published Casualty and Business Losses When Basis Hasn’t Been Lost, 120 Tax Notes 357 (7/28/08):

The proposal is made as a part of the Shelf Project, a collaboration by tax professionals to develop and perfect proposals to help Congress when it needs to raise revenue. Shelf Project proposals are intended to raise revenue, defend the tax base, follow the money, and improve the rationality and efficiency of the tax system. The tax community can propose, follow, or edit proposals at http://www.taxshelf.org.  … 

This proposal would deny a business or casualty loss deduction for basis to the extent of the fair market value of the property held by the taxpayer after the casualty or loss event. To the extent property still has value, basis has not been lost. The proposal would have no effect on sales, total losses, or properties like cars and machinery that do not appreciate. The proposal is part of a series of proposals under a grand norm that adjusted basis needs to describe the investment value of an asset.