6 ms·

You know I can't agree with you more. That's why we need a 100% inheritance tax. So someone's effort doesn't go to someone who doesn't deserve it.

morgante 10y ago
I'm not sure if you're being farcical, but I actually strongly support a 100% inheritance tax. It might be challenging to enforce, but it seems like the most equitable solution by far. There's nothing wrong with people earning lots of money from their own work, but they shouldn't be able to pass that on to heirs who have done literally nothing to earn it.
- RangerScience 10y ago
  This is definitely more complicated than that. In the most basic sense, how much should I be allowed to do what I want with my own money? A step more complex; giving to your kids is, AFAIK, one of the biggest drivers in why people try to make money during their lifetimes. A step more liberal: Inheritance (the accumulation of wealth by a family), again, AFAIK, is an important part of upwards mobility. The current setup is definitely sub-optimal. 100% would also be sub optimal, and, I'd argue, worse than what we've got here, because it's another thing that rich people could dodge that not-rich people couldn't.
  - morgante 10y ago
    > In the most basic sense, how much should I be allowed to do what I want with my own money? It's not your money once you're dead. As far as I'm concerned, dead people don't have any rights. > A step more liberal: Inheritance (the accumulation of wealth by a family), again, AFAIK, is an important part of upwards mobility. On the contrary, I think it hurts economic mobility a lot more than it helps. If you're competing for opportunities with people who inherited millions of dollars (without doing anything themselves), it's a lot harder to advance yourself. Non-rich people don't generally leave enough of an estate for it to matter in the first case. We could easily exclude the first $100k for that matter.
    - NhanH 10y ago
      If Mark Zuckerberg and his wife is hit by a truck tomorrow. Is the US government taking over FB? Cause I don't see the kid getting $50 billion to pay the tax bill.
      - morgante 10y ago
        Obviously, he can sell stock to pay the tax bill. Or the government could directly take ownership and sell the stock. We have an existing estate tax. It's not a novel concept.
        NhanH 10y ago
        You're proposing that a) Selling $50 billion worth of stock in a company, b) Government takes ownership of Facebook, or some combination thereof of the two actions. Yes, it is novel to do that.
        morgante 10y ago
        I didn't suggest that the government should own Facebook over the long term. It should simply impose a tax on the estate, which would require that stock be liquidated to meet that obligation. There's already a 40% inheritance tax. How do you think it works in the status quo?
        NhanH 10y ago
        The difference is in the number. 40% means that I can realistically leverage my own share of the stock to get money and pay the tax. 100% means that I walk away and the government can figure out what to deal with the ownership.
        morgante 10y ago
        I don't know why you think it would be so hard for the government to deal with the ownership. There are plenty of people who would be interested in buying Facebook stock. Plenty of estates have to be liquidated to settle debts and taxes today. It's hardly unprecedented.
  - collyw 10y ago
    Basically we need to make a choice between inheritance and meritocracy, as the two are at odds with each other. Personally I would choose meritocracy (even though I will likely end up above average through inheritance eventually).
- prostoalex 10y ago
  If this was the genuine cause of economic distortions, and wealthy people are mutually exclusive with economic mobility, wouldn't the states with high amount of wealthy people (NY, CA) slowly but surely lose any economic advantages to the states with low amount of wealthy people, but extremely high potentials of economic mobility (MS, WV)?
  - morgante 10y ago
    First of all, I never said "wealthy people are mutually exclusive with economic mobility." For one thing, I think earned wealth is actually very helpful for economic mobility and is actually a huge part of why places like NY/CA succeed—successful entrepreneurs continue to invest in the ecosystem and funnel money towards new entrepreneurs. Moreover, something could be a depressant on economic mobility without eliminating economic mobility entirely. The stability of capital is in fact a huge part of how NY/CA remain successful—if you're ambitious, you have to move towards the capital to access it. Also, keep in mind we're in the context of a thread where people are already discussing how to soak the rich. I'd much rather tax estates than dramatically increase taxes for people who have earned their money.
    - prostoalex 10y ago
      Good point, I misread on mutual exclusivity. For what it's worth high estate taxes don't seem to correlate with economic growth (neither are zero estate taxes, to be fair) - I am reading this graph http://taxfoundation.org/article/estate-and-inheritance-taxes-around-world http://taxfoundation.org/article/estate-and-inheritance-taxe... and Japan, for example, being high on the GDP ranking is kinda dead in the water as far as economic growth ranking. I think eventually the estates succumb to "three generations" rule, so the problem might be self-correcting.
      - morgante 10y ago
        My argument isn't necessarily an economic one. I don't particularly think that a high estate tax will stimulate the economy, but I also don't think it will hurt. The advantage of a high estate tax is more a social one of removing unearned wealth and freeing up some money to spend on social programs. But you're right that it might be more efficient to make the tax 95% so the beneficiary has an incentive to handle the liquidation so they can get their 5%.
martinshen 10y ago
The US already has a fairly aggressive inheritance tax. It's pretty much 40% after the first $5.4M. The US has the 4th highest inheritance tax in the world. https://en.m.wikipedia.org/wiki/Estate_tax_in_the_United_States https://en.m.wikipedia.org/wiki/Estate_tax_in_the_United_Sta...
- nugget 10y ago
  Note that Clinton's published tax plan calls for increasing the rate to 45% and lowering the threshold to $3.5m. No matter who wins the election I'd expect this tax to at best remain static and more likely to increase over time.

morgante 10y ago

I'm not sure if you're being farcical, but I actually strongly support a 100% inheritance tax. It might be challenging to enforce, but it seems like the most equitable solution by far. There's nothing wrong with people earning lots of money from their own work, but they shouldn't be able to pass that on to heirs who have done literally nothing to earn it.

RangerScience 10y ago
This is definitely more complicated than that. In the most basic sense, how much should I be allowed to do what I want with my own money? A step more complex; giving to your kids is, AFAIK, one of the biggest drivers in why people try to make money during their lifetimes. A step more liberal: Inheritance (the accumulation of wealth by a family), again, AFAIK, is an important part of upwards mobility. The current setup is definitely sub-optimal. 100% would also be sub optimal, and, I'd argue, worse than what we've got here, because it's another thing that rich people could dodge that not-rich people couldn't.
- morgante 10y ago
  > In the most basic sense, how much should I be allowed to do what I want with my own money? It's not your money once you're dead. As far as I'm concerned, dead people don't have any rights. > A step more liberal: Inheritance (the accumulation of wealth by a family), again, AFAIK, is an important part of upwards mobility. On the contrary, I think it hurts economic mobility a lot more than it helps. If you're competing for opportunities with people who inherited millions of dollars (without doing anything themselves), it's a lot harder to advance yourself. Non-rich people don't generally leave enough of an estate for it to matter in the first case. We could easily exclude the first $100k for that matter.
  - NhanH 10y ago
    If Mark Zuckerberg and his wife is hit by a truck tomorrow. Is the US government taking over FB? Cause I don't see the kid getting $50 billion to pay the tax bill.
    - morgante 10y ago
      Obviously, he can sell stock to pay the tax bill. Or the government could directly take ownership and sell the stock. We have an existing estate tax. It's not a novel concept.
      - NhanH 10y ago
        You're proposing that a) Selling $50 billion worth of stock in a company, b) Government takes ownership of Facebook, or some combination thereof of the two actions. Yes, it is novel to do that.
        morgante 10y ago
        I didn't suggest that the government should own Facebook over the long term. It should simply impose a tax on the estate, which would require that stock be liquidated to meet that obligation. There's already a 40% inheritance tax. How do you think it works in the status quo?
        NhanH 10y ago
        The difference is in the number. 40% means that I can realistically leverage my own share of the stock to get money and pay the tax. 100% means that I walk away and the government can figure out what to deal with the ownership.
        morgante 10y ago
        I don't know why you think it would be so hard for the government to deal with the ownership. There are plenty of people who would be interested in buying Facebook stock. Plenty of estates have to be liquidated to settle debts and taxes today. It's hardly unprecedented.
- collyw 10y ago
  Basically we need to make a choice between inheritance and meritocracy, as the two are at odds with each other. Personally I would choose meritocracy (even though I will likely end up above average through inheritance eventually).
prostoalex 10y ago
If this was the genuine cause of economic distortions, and wealthy people are mutually exclusive with economic mobility, wouldn't the states with high amount of wealthy people (NY, CA) slowly but surely lose any economic advantages to the states with low amount of wealthy people, but extremely high potentials of economic mobility (MS, WV)?
- morgante 10y ago
  First of all, I never said "wealthy people are mutually exclusive with economic mobility." For one thing, I think earned wealth is actually very helpful for economic mobility and is actually a huge part of why places like NY/CA succeed—successful entrepreneurs continue to invest in the ecosystem and funnel money towards new entrepreneurs. Moreover, something could be a depressant on economic mobility without eliminating economic mobility entirely. The stability of capital is in fact a huge part of how NY/CA remain successful—if you're ambitious, you have to move towards the capital to access it. Also, keep in mind we're in the context of a thread where people are already discussing how to soak the rich. I'd much rather tax estates than dramatically increase taxes for people who have earned their money.
  - prostoalex 10y ago
    Good point, I misread on mutual exclusivity. For what it's worth high estate taxes don't seem to correlate with economic growth (neither are zero estate taxes, to be fair) - I am reading this graph http://taxfoundation.org/article/estate-and-inheritance-taxes-around-world http://taxfoundation.org/article/estate-and-inheritance-taxe... and Japan, for example, being high on the GDP ranking is kinda dead in the water as far as economic growth ranking. I think eventually the estates succumb to "three generations" rule, so the problem might be self-correcting.
    - morgante 10y ago
      My argument isn't necessarily an economic one. I don't particularly think that a high estate tax will stimulate the economy, but I also don't think it will hurt. The advantage of a high estate tax is more a social one of removing unearned wealth and freeing up some money to spend on social programs. But you're right that it might be more efficient to make the tax 95% so the beneficiary has an incentive to handle the liquidation so they can get their 5%.

martinshen 10y ago

The US already has a fairly aggressive inheritance tax. It's pretty much 40% after the first $5.4M. The US has the 4th highest inheritance tax in the world. https://en.m.wikipedia.org/wiki/Estate_tax_in_the_United_States https://en.m.wikipedia.org/wiki/Estate_tax_in_the_United_Sta...

nugget 10y ago
Note that Clinton's published tax plan calls for increasing the rate to 45% and lowering the threshold to $3.5m. No matter who wins the election I'd expect this tax to at best remain static and more likely to increase over time.