Why allow extension at all?
The initial term serves as a societal "thank you for that cool idea". I'm not sure I agree that financial success should mean society continues to award you exclusive rights to the idea.
Applying modern intellectual property law to "base" inventions illustrates how ridiculous it is. Should we be paying a tithe to the descendants of the person that built the first wheel? Would humanity have been better off if it had prevented anyone other than that individual from building wheels without their express permission? The answer is clearly no. That individual benefited personally from their invention and from the improvements to efficiency in the rest of their society. Restricting that would only have served to impede further innovation, prosperity, and quality of life.
This way you can set the base copyright duration shorther than you could otherwise without people complaining that some works take a while to become profitable.
That said, I agree that it isn't neccesarily the best idea is it predominantly benefits the already well off who can better afford to gamble on the copyright extension fees.
Personally I think zero copyright is probably the best since society benefits from sharing and remixes from day one. Look at how quickly memes propagate and consider if copyright was actually enforced there. Now consider if the could have the same creative mobility for the kinds of works where copyright is enforced.
But I also don't see zero copyright as attainable within my lifetime as it would upend so many business models. Shorter copyrights (with or without extensions) are much more realistically attainable as for most copyright holders it might change the equation a bit but won't require them to immediately overthink their funding.
Property is an unnatural, made up construct.
> that will one day be seen as ridiculous as absolute monarchy is today.
Maybe, by just asserting untestable claims about future opinions isn’t an argument.
> If we are going to allow it and penalize people who are doing natural human things like sharing with friends, there has to be a specific benefit to society in every instance.
That’s a valid preference. I disagree, I think that a system of property law which provides net benefit in aggregate is adequate, requiring each individual exercise of property rights to be a net benefit in specific is too much overhead.
> For example, pay taxes on copyrights and patents, increasing every year to reflect disturbance caused to society.
I’d rather have both have short, free terms with copyright extendable by a tax, unless you are going to have a more general property tax than just on patents. But note that taxing property isn’t a sign that it is particularly “made up”, real property and some items of tangible personal property also have property taxes.