The word for this week is “death tax,” which is the loaded term used by opponents of what is properly called the estate tax.
The estate tax is the only institutionalized check we have to stave off concentrated power, which is exactly what the founders of this nation hoped to guard against. Yet, we’ve got folks who supposedly cherish “Constitutional originalism” and sneer at the centralized illusions of “socialism,” who still call it the “death tax.”
In making a preserve-the-estate-tax case over the years, some readers have asked: “Sean, are you a Marxist?”
If it’s Marxist to observe that the estate tax is what keeps this 400-year-old experiment in democracy from turning into a land of peasants and serfs being lorded over by a class of aristocrats with “impervious piles of wealth” (Bill Gates’ words, not mine), then call me Karl, comrade.
So-called “death tax” opponents have penchant for red herring polemics — the estate tax punishes success, hurts “small” family businesses and has even led to the farm being taken away from “small family farmers.” Gasp!
I’ve yet to find an ounce of evidence for this alleged large group of working people harmed by an estate tax. Meanwhile, I got in touch with actual multi-millionaire members of Responsible Wealth to find out how “Marxist” they are.
Darius Ross, for example. Ross, a 41-year-old entrepreneur with 19 years of experience in real estate sales, construction, acquisition and development, is the founder and managing partner of D. Alexander Ross Real Estate Capital Interest, LLC — a boutique of high net worth investors involved in real estate private equity and commercial acquisitions.
Of the approximately 5,000 top commercial real estate asset holders in America, who control about $400 trillion in assets, only 100 are black. It’s just one stark example of the extreme concentration of wealth and economic disparity that exists in this country, Ross said.
“Our people are talking about buying their first home and (the wealthy) are talking about buying mega-developments,” he said.
Because most Americans don’t own estates and are in the looking-for-their-first-home class, Ross pointed out, many people mistakenly think they’re not directly affected by the outcome of the estate tax debate.
“But tax money is what funds needed programs, including first-time home buyer programs. If we lose the estate tax, there won’t be that mother buying her first house. She’ll be renting for the rest of her life. This would create a permanent underclass,” Ross said.
I asked him if he felt his success was being punished by the estate tax. “How do you punish successful people? That’s not the way the game works. I can always come back (financially) because I understand the hustle. That’s true of anyone who has been economically successful in this country.”
“It’s like having a privilege pass. Somewhere along the line some investor is going to put up money to get you started again. That’s how it works. It’s knowledge capital, which is more powerful than money. I call it The Hustle,” he said.
The estate tax doesn’t punish the rich. It spreads economic opportunity. The rich will always be able to make millions.
As you read this the Senate is preparing to vote on the proposal to permanently repeal the estate tax, as if we aren’t facing record budget deficits.
Currently, only those who leave estates greater than $2 million, or $4 million for couples, must pay the tax. In 2006, it is estimated that 0.27% of all estates in the U.S. will pay estate tax, meaning 99.73 percent of Americans can pass 100 percent of their estates to heirs tax free. Repealing the estate tax is estimated to cost $1 trillion over the first ten years of full repeal.
“We are currently facing a large list of multi-billion-dollar obligations, including up to $1.3 trillion for the cost of the war in Iraq, $3.3 trillion in interest on the national debt, and $797 billion to pay for the Medicare drug benefit,” says Steven C. Rockefeller, chairman of the Rockefeller Brothers Fund.
“To reduce the nation’s revenue stream by $1 trillionâ€¦in order to enrich a small group of multi-millionaires and billionaires, is fiscally irresponsible and bad social policy. The estate tax could be reformed, but it should certainly be preserved and the revenue used to pay our national bills.”
Rockefeller is a signer of the Call to Preserve the Estate Tax, a project of Responsible Wealth (http://www.responsiblewealth.org), spearheaded by William Gates, Sr., head of the Bill and Melinda Gates Foundation and father of the richest man on the planet.
Sign up. Get involved. Or get hustled.
ZNet commentator Sean Gonsalves is a Cape Cod Times reporter and syndicated columnist. He can be reached at [email protected]