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You've asserted several times in this thread that there are devastating consequences to the estate tax but never explain what those might be. Care to enlighten?

conanbatt 9y ago
The idea of inheritance taxes are that once you are dead, you don't care about paying taxes. However, leaving wealth for your children is a huge economic incentive. As Friedman puts it: "People go to an irrational length to provide their kids a better life than they will ever get". If you could effectively put 100% tax on inheritance(which you can't in practice), it means your utility of leaving wealth around becomes 0. Now you want to spend that wealth as much as possible, and it turns into consumption. You would sell and spend everything you have for lavish expenses, which means a reduction in capital investment, which means slower economic growth. https://www.youtube.com/watch?v=MRpEV2tmYz4 https://www.youtube.com/watch?v=MRpEV2tmYz4
- frgtpsswrdlame 9y ago
  Yeah I'm totally okay with that, a certain point society has to serve its people and not just the abstract view of growth at all costs. Consumption is good for the economy and inheritance taxes are necessary to provide equality of opportunity.
  - conanbatt 9y ago
    > Consumption is good for the economy I doubt hedonist consumption is what Keynes had in mind. > inheritance taxes are necessary to provide equality of opportunity. Lets take this to the extreme: lets say that your father could not provide you with anything but minimum substance until your coming of age (18?). Anything given to you by your parents would be taxed away. This means that you now cannot go to any college that is not provided to you by credit. But you have no assets and no income, so nobody will loan you any money. Plus, you don't have money for rent, so you need to work immediately to pay for your own place. Maybe you feel sympathy for the millions of people that actually live that, but how is forcing everyone to go through that be better for society at large? Or think what it would mean for the state to actually do that: what if you had to build any infrastructure built by a previous generation from scratch, because "its not fair the SF bridge is nicer than the Brookly bridge, its inherited". The emotional answer I have against advocating inheritance tax is that the goal is not to be fair, its to be better. And certainly fair by destruction, by removing everything, is not better.

conanbatt 9y ago

The idea of inheritance taxes are that once you are dead, you don't care about paying taxes. However, leaving wealth for your children is a huge economic incentive. As Friedman puts it: "People go to an irrational length to provide their kids a better life than they will ever get". If you could effectively put 100% tax on inheritance(which you can't in practice), it means your utility of leaving wealth around becomes 0. Now you want to spend that wealth as much as possible, and it turns into consumption. You would sell and spend everything you have for lavish expenses, which means a reduction in capital investment, which means slower economic growth. https://www.youtube.com/watch?v=MRpEV2tmYz4 https://www.youtube.com/watch?v=MRpEV2tmYz4

frgtpsswrdlame 9y ago
Yeah I'm totally okay with that, a certain point society has to serve its people and not just the abstract view of growth at all costs. Consumption is good for the economy and inheritance taxes are necessary to provide equality of opportunity.
- conanbatt 9y ago
  > Consumption is good for the economy I doubt hedonist consumption is what Keynes had in mind. > inheritance taxes are necessary to provide equality of opportunity. Lets take this to the extreme: lets say that your father could not provide you with anything but minimum substance until your coming of age (18?). Anything given to you by your parents would be taxed away. This means that you now cannot go to any college that is not provided to you by credit. But you have no assets and no income, so nobody will loan you any money. Plus, you don't have money for rent, so you need to work immediately to pay for your own place. Maybe you feel sympathy for the millions of people that actually live that, but how is forcing everyone to go through that be better for society at large? Or think what it would mean for the state to actually do that: what if you had to build any infrastructure built by a previous generation from scratch, because "its not fair the SF bridge is nicer than the Brookly bridge, its inherited". The emotional answer I have against advocating inheritance tax is that the goal is not to be fair, its to be better. And certainly fair by destruction, by removing everything, is not better.