The House Killed the Estate Tax. A Victory for the One Percent! | New NY 23rd

Finger Lakes Times journalist Jim Miller’s April 19 “Eye on Government” column was entitled “Death tax could stay very much alive.” He reported that the House of Representatives had voted to repeal the estate tax, “commonly called the death tax”, and   explained that the repeal would have a difficult time being approved in the Senate. If it did, the President would probably veto it.

Mr. Miller noted that our congressman voted to repeal the Estate Tax tax, and wrote:

“Death should not be a taxable event,” Reed said. “Yet for our Southern Tier and Finger Lakes farmers and families who’ve lost loved ones, it can mean the end of their livelihood. This is because the death tax can force grieving families to sell off parts of the family farm or the business entirely. This is wrong. I care about our grieving families and want them to have a fair shake after a tragic loss.” Reed also went the ideological route, calling the death tax a relic of big government. Democrats probably would debate that, but they’d likely agree that family farms and businesses are things that people should be able to pass on to their kids without red tape and taxes coming into play.

The independent Center on Budget and Policy Priorities’ recent article listed the Ten Facts You Should Know About the Federal Estate Tax. It states:

1. Roughly 2 of Every 1,000 Estates Face the Estate Tax

2. Taxable Estates Generally Pay Less Than One-Sixth of Their Value in Tax

3. Large Loopholes Enable Many Estates to Avoid Taxes

4. Only a Handful of Small, Family-Owned Farms and Businesses Owe Any Estate Tax

5. The Largest Estates Consist Mostly of “Unrealized” Capital Gains That Have Never Been Taxed

6. The Estate Tax Is a Significant Revenue Source

7. Repeal Would Likely Leave Less Capital for Investment

8. Compliance Costs Are Modest

9. The United States Taxes Estates More Lightly Than Comparable Countries

10. The Estate Tax Is the Most Progressive Part of the U.S. Tax Code

The following are three letters published in the Letters to the Editor section of the Finger Lakes Times about Miller’s column. I need to disclose  that I know Mr. Overgaard personally, and have never met Mr. Raes. If there are more letters on this topic I will add them and re-post this article.

LETTER: Getting rid of Estate tax one more step in inequality

Posted: Wednesday, May 6, 2015 

To the Editor:

Of course the Republicans voted to get rid of the Estate (Death tax ) as the Times’ Jim Miller wrote about April 19. For them it is just one more step in the process of having 1 percent of the population owning and controlling everything. It will be just as in the old countries, poor people fled to find opportunity in the United States, where success was what you could accomplish, not what you could inherit.

Those days are disappearing here with inequality now one of the highest in the world. Do they really not understand that when someone owns everything in a game of Monopoly, that is the end of the game and the only way to progress is to clear the board and start over? In the real world that is called a revolution, something that happens when the 99 percent finally has had enough of being serfs. Will the Republicans’ and big farmers’ whining and greed never stop?

Only a few years ago Estate tax was levied on estates over $1 million, now it is only on estates over $5.4 million ($10.8 million for a couple). If a young farmer can’t make it after inheriting the equivalent of 8,000 cows completely tax-free maybe he is not fit to be a farmer and should find something else to do. And how will the young farmer that does not inherit one single cow compete with the guy who was given 8,000 cows?

Big farmers already pay next to no local tax on their land, so we have to pay that for them also. Next time someone complains about the “Death tax” just say, “So you must own more than $5.4 million ($10.8 million) poor you, I feel so sorry for you! It is those same big farmers that always complain that they can’t get any Americans to work for them even for a whopping $12 an hour!

Now, in business, everything is supposed to be guided by supply and demand. So if farmers/businesses can’t get enough workers at $12, they are obviously not paying enough! Maybe they should try $30 per hour with full health benefits. Last year that would barely have made a dent in big dairy farmer’s million- dollar net incomes. While we are at it, there is an oversupply of politicians that want $50/hr “jobs” in Albany, so why not lower that to $12/hr as it is in some other states?


LETTER: Moving estate tax to $1M mark would punish many local farmers

Posted: Thursday, May 21, 2015

To the Editor:

Jorgen Overgaard had a very interesting letter in the Finger Lakes Times on May 6 (“Getting rid of estate tax one more step in inequality”).

It’s rather disheartening when a man who lives on one of the most beautiful lakes in the world attacks the local farmers. He seems to identify with the “99 percent” (a term made popular by the Libs) yet owns 138 feet of Keuka Lake.

Farmers did make money at one point last year but are losing about $2 on every 100 pounds of milk they are producing at the current price. Tell me, if any one of our readers worked all week and then gave their employer a check for 20 percent of their pay on Friday, how happy would they be?

The question on the estate tax, as I understand it, is that it may go back to the $1 million mark. This would involve pretty much every farmer in the area. I’m not sure what Mr. Overgaard’s life is like or how hard he works, but I am pretty sure he doesn’t get up at 3:30 in the morning to milk cows at 4 a.m., noon and again at 8 p.m., go to bed at 11 p.m. and be back up the next morning to do it again. My nephews do, and right now it is all for nothing!

I still can’t figure this out: If an individual works and pays taxes all his life on his earnings, why does he need to turn over the money that’s left at the time of his death to the government?

If Mr. Overgaard feels as strongly as his letter, he should be paying anyone that works for him $30 an hour with full benefits. Or maybe he should cash out of this “Monopoly Game” right now, give all his money to the government and move into an apartment in Geneva. You know: “Clear the board and start over.”


LETTER: Big businesses, casinos and big farms are the problems

Posted: Monday, June 1, 2015

To the Editor:

No, Mr. Raes (Letter to the Editor, May 21), I do not get up at 4 a.m. to milk cows, like your nephews, but I did just that from age 15 to 20. Then I decided it was not for me, as your nephews are free to do if they don’t like it.

Now even at retirement age I do taxes for Mennonite farmers 75 hours a week for part of the year. I can respect Mennonite farmers because they seldom apply for nor do they accept government subsidies.

Hypocritical big businesses, casinos and big farms are the ones I have a problem with. They want to keep all their profits, while they claim poverty and want taxpayers to subsidize them at every turn. The Farm Bureau is especially good at securing one property taxbreak after another that then has to be paid by the rest of us. There is no talk of going back to taxing estates down to $1 million. The vote was simply to repeal all estate tax and tax on carried-over gains, even on billion-dollar estates.

The notion that estate tax is paid on income already taxed is also mostly not true. Take a guy with an estate of Exxon stock, land and cows of $5 million (just under the present limits). He paid $1 million for these assets over time, so he has a gain of $4 million. If he sells the stuff the day before he dies, he pays say $800,000, mostly capital gains tax. If he still owns it the day he dies, the $800,000 tax and estate tax just disappear forever for both him and his heirs. Why does that make sense?

If you want to understand the dangers to democracy of extreme income and capital concentration, read Thomas Piketty’s bestseller “Capital in the 21st Century.” One problem is that rich people, even if they just inherited their riches, most often think they are smarter and more deserving than the less fortunate and that they therefore also should run the government, and when they do, they make things even better for themselves and forget the poor. With the Supreme Court’s decision that corporations are people and that money is free speech, they have almost achieved their goal.

I am not arguing for clearing the board (revolution) right now, just that it would be stupid to pass more laws that would make the need for it inevitable.


This entry was posted in Uncategorized. Bookmark the permalink.

This entry was posted in Blog. Bookmark the permalink.