Perhaps no issue more squarely puts the neoconservatives into the camp of unAmerican than their opposition to the estate tax. Quite simply, it is not enough for them that inheritences up to $6 million are exempt from taxes. They think it is unfair for folks inheriting more than $6 million to pay taxes at all.
There can only be a few explanations for such support. One is that you think that the working stiff who is stupid enough to have been born poor or middle class should be the one paying taxes on the income he has earned so that the fellow born rich doesn't have to be taxed a dime on the money he has done nothing to earn. The other is that you think that neither the working class stiff or the rich should pay the taxes but that, instead, the next generation should pay the taxes, deferring the cost of government to the next generation in the form of debt.
There is, of course, one other explanation. The rich actually think that you are an idiot and would eagerly support tax relief for Paris Hilton and her trust fund buddies, agreeing to pay their share out of your hard-earned income.
3 comments:
One of the first vocal proponents for the estate (not "death") tax was Teddy Roosevelt. He warned that, without such a tax, an American royalty would be created - a large group of families where wealth would passed down for generations and where work would be optional. Roosevelt felt this would be a disastrous outcome, even though he came from a family which had the potential to become "royal".
One of the greatest accomplishments of the republican media channels was to convince its faithful middle class viewers/listeners to embrace this brazen payback to the high rollers who fund the party. Was the media that good or were the listeners that stupid?
I don't really have a position on this but there is obviously an incentive to build wealth if you know others can inherit it so there is at least one other reason to want to kill the estate tax if you believe wealth building helps more than the wealth builder.
Daryl,
I'm not sure what the research says about whether tax on wealth transfer lowers formation of wealth (because the rich are frustrated by the taxes) or raises formation of wealth (because they are trying to offset the effects of taxes). I do know that research of adult children of multi-millionaires (whose estate would be safe from estate tax if it was worth less than $6 million) make less money than their peers, suggesting that taxing inheritences might actually stimulate economic activity.
Life hiker - Teddy is a hero - probably the most fascinating president of the last century.
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