Thursday, July 28, 2005

Inheritance Taxes: Not the greatest but preferable to Maoism

Though the American yahoo typically views taxation as part of some communist plot, arguments in favor of estate taxes and inheritance taxes are not far from the premises of the American revolution. Stripping away the grammar school myths and yankee nationalist gloss, the intelligent observer may perceive that the Founding Fathers were quite similiar, at least in motivations, to the "red republican" Jacobins agitating in the Paris streets: both collectively rejected hereditary aristocracy and the absurd inequalities of wealth that characterized pre-Revolutionary France and Britain. Alexis de Tocqueville, visiting America in the early 19th century, asserted "The American experiment presupposes a rejection of inherited privilege." The exorbitant wealth of a Bill Gates or Paris Hilton or other billionaires is in a very real sense a return to the aristocratic privilege and dynasties which the Founders overthrew.

That is not to say that the moderately successful small-town businessman should not be able to hand down a large portion of his estate to his child or to whomever he deems fit. But the children of Bill Gates or Conrad Hilton are not simply obtaining some college funds and a nice car—they are obtaining, through no efforts of their own, a financial or corporate empire. (ironically, Bill Gates himself has argued in favor of the estate tax). Those economists and citizens who argue in favor of progressive estate taxes (and against aristocratic or corporate dynasties) are therefore following the Jeffersonian tradition, more or less, which is opposed to the finance and property schemes which led to the gross disparities of wealth and property of pre-Revolutionary Europe. The American yahoo might unthinkingly refer to Jeffersonian egalitarianism as “socialism,” but more correctly would be to refer to the Paris Hiltons of the world as decadent, idle aristocrats, if not seditionists.

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