Why the Death Tax is not the Answer
Posted by Brian Garst on September 16, 2010
Writing for Human Events, Kate Obenshain offers an excellent refutation of the latest statist talking points on the death tax:
After quadrupling the deficit in less than a year, and spending more on “stimulus” programs than on seven years of the Iraq War, liberals think the solution to our economic woes—they call it a revenue problem, not a spending problem—is to bring back the costliest tax the government has yet to devise: the death tax.
The Congressional Budget Office estimates that the estate tax, combined with the gift tax, brings in about $8 billion a year. In the context of our national budget of $3.5 trillion, that’s hardly a drop in the bucket.
Typically shortsighted, this latest liberal solution doesn’t take into account that the death tax actually hurts the economy by depriving it of about $850 billion in capital over ten years.
…Liberals ignore what they know to be the negative economic impact because they are seeking their idea of social justice, the economy be damned. Rubin argued that this tax will help us by “avoiding the accumulation of inherited wealth.”
These would-be social engineers and national equalizers insist that money not be passed down from one generation to the next. What they willingly ignore is that the massive fortunes of John Kerry or Warren Buffet will never be dispersed among the common folk; they have no trouble paying an army of attorneys to avoid the tax bill when their time comes. They know full well that it is the average Joe who has worked, sacrificed and scraped by to build a family business whose family will pay the piper. And because these small businesses often don’t have large, or any, cash reserves, they will usually do it by having to sell the farm or the business. So much for the American dream.
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