Article on the Federal Estate Tax
One of the great mysteries in life begs the question: What will happen to me after I die? This specific query will likely remain a mystery as long as the Ouija board proves to be an unreliable source of information. But in modern times people are less mystified and frightened about deciding what happens to their assets after they die. While what happens after death remains a mystery, the system of inheritance and its true effect on society need not be shrouded in the same mysterious cloak. The idea of passing on wealth has been engrained in the American psyche since the start of the country. For centuries, the English battled with its own system of inheritance. They transformed from a group of people with no testamentary freedom into a society controlled by the extremely wealthy who inherited their wealth. It should be no surprise that a country founded by those same people would start its own history with reservations over their inherited system of passing wealth. Early Americans struggled to decide what to take or leave from the old world, and their struggle did not end with the signing of the Declaration of Independence. As a result, America is still struggling with its inherited system of inheritance today.
In a country that boasts about the national “dream” of starting with nothing and ending with everything through hard work and perseverance, how is it that the archaic tradition of passing on wealth (like the custom of passing on a title of nobility) stands the test of time? Although the founding fathers established America with elements of inheritance engrained in their minds, some initially resisted continuing the English aristocratic system. Unfortunately, man’s natural greed and jealousy allowed the institution of inheritance to continue down its destructive path. So, why does America still have inheritance? And, perhaps, would it be better off without it?
This comment discusses the history of America’s inheritance system, the recent debate over the federal estate tax, and the unfair nature of the inheritance system. Part II briefly looks at the history behind allowing people to decide what happens to their assets after they die. Part II also provides a historical overview of inheritance in medieval and early modern England and colonial America. Part III discusses the federal estate tax and the recent debate to either permanently repeal or reinstate previous versions of it. This discussion looks at the Tax Relief, Unemployed Insurance Reauthorization, and Job Creation Act of 2010 and analyzes the estate tax debate including the effects of the estate tax on federal revenue, farmers and small business owners, and charitable donations. Part III will also examine the social impact of inheritance. Part IV discusses the inheritance system’s inherently unfair nature by questioning its contribution to the unequal distribution of wealth and exploring the advantages that wealth provides to the few who receive it. This part also refutes the argument that inheritance helps a capitalist system function by demonstrating how inheritance directly opposes capitalism. Finally, Part V argues the potential benefits of extinguishing the current system of inheritance. Ultimately, this comment demonstrates the historical development of inheritance options, examines the harmful effects a generous inheritance may have on American ideology, and explores why America may benefit from the absence of inheritance.