Re:Warren Buffett: Pretty Good for Government Work
by gnosis on Wednesday November 17, 2010 @01:38PM
(#1915190)
"If you've been working hard to ensure your wife and children don't want for anything in life, why in hell should the government take half of what you've earned and already paid taxes on?"
To avoid the creation of an aristocratic class.
The founding fathers had this specific aim in mind. Details here:
http://budiansky.blogspot.com/2010/10/adam-smith-thomas-jeff...
A relevant quote from the article:
[Thomas] Jefferson cited Adam Smith, the hero of free market
capitalists everywhere, as the source of his conviction that (as
Smith wrote, and Jefferson closely echoed in his own words), "A
power to dispose of estates for ever is manifestly absurd. The
earth and the fulness of it belongs to every generation, and the
preceding one can have no right to bind it up from posterity. Such
extension of property is quite unnatural." Smith said: "There is
no point more difficult to account for than the right we conceive
men to have to dispose of their goods after death."
The states left no doubt that in taking this step they were giving
expression to a basic and widely shared philosophical belief that
equality of citizenship was impossible in a nation where
inequality of wealth remained the rule. North Carolina's 1784
statute explained that by keeping large estates together for
succeeding generations, the old system had served "only to raise
the wealth and importance of particular families and individuals,
giving them an unequal and undue influence in a republic" and
promoting "contention and injustice." Abolishing aristocratic
forms of inheritance would by contrast "tend to promote that
equality of property which is of the spirit and principle of a
genuine republic."
Re:Warren Buffett: Pretty Good for Government Work
by jacques_chester on Wednesday November 17, 2010 @07:25PM
(#1916304)
In capitalist societies this is less of a problem. Wealthy families generally dissipate their wealth in a few generations, not through taxes or charity, but through consumption, error and incompetence.
Trust babies destroy family fortunes more efficiently than estate taxes.
Re:Warren Buffett: Pretty Good for Government Work
by igrekel on Wednesday November 17, 2010 @10:59AM
(#1914625)
You know some die hard capitalists would argue that all of your wealth should be taken away at death. That way, the wealth of an individual can only come from what you build and create during your life. Not that I think it is the correct or fair way of thinking, its seems just so wrong when death was unforeseeable.
Re:Warren Buffett: Pretty Good for Government Work
by jbooth on Wednesday November 17, 2010 @09:30AM
(#1914304)
Ok, so basically I'm right about the few million part. Attempts to say it could be otherwise, but isn't, notwithstanding.
And if your wife and children inherit 3.5 million tax free and half of everything else, they will be fine. I'm more sympathetic to the wife argument, if she was spending time with the kids instead of developing a career - the children have presumably had a good education, they should be able to make their own money if 3.5 million isn't enough.
RE: compound interest, if you don't understand that, then you really do not understand inherited wealth.
Much of the money you have on hand when you die has already been taxed in one form or another. (If it hasn't, your death should trigger the much lower capital gains tax - that's how it works in Canada, for example.) If you've been working hard to ensure your wife and children don't want for anything in life, why in hell should the government take half of what you've earned and already paid taxes on?
I don't understand your bit about compound interest. The people in this community who are affected by the estate tax don't get there through compound interest, they get there through entrepreneurship and job creation. If you want to propose that the estate tax only affects passive income, I'd certainly be in favor.