wrote in message
...
On Fri, 30 Jul 2010 15:37:47 -0400, "Ed Huntress"
wrote:


"Lloyd E. Sponenburgh" lloydspinsidemindspring.com wrote in message
8.3.70...
Ignoramus18915 fired this volley
in
:

Estate tax is an attempt to balance the pluses with minuses. Some
amout being taxed, still keeps people interested in becoming wealthy,
but curtails to some extent this resource misallocation.

Ig, the estate tax might have some small effect like that, but that's
hardly its purpose. I would love it if that were actually the case, but
that's a utopian's view.

The real reason for the tax is simply that the government saw a nice,
fat
pot to skim from, and decided to take a piece. They new darned well if
they took it from the average working stiff who's widow needs the whole
estate just to buy groceries, they'd have a rebellion.

There were no reasons of societal altruism in establishing the estate
tax. It's just another pork pot. Would that it were as you say.

LLoyd

In terms of why such taxes were enacted, you're quite right. As for why
they
have stuck (on and off since 1797 in the US, and much longer in some
European countries), it's been a common sentiment that heirs have no
natural
right to a person's wealth after their death, and that society as a whole
has a stronger claim. In other words, like sin taxes, it's been widely
accepted because most people have agreed that it's fair.

That's been the source of the arguments about it, and other types of
transfer taxes, for hundreds of years. As always with taxes that are not
issued strictly per-capita, a nation's tax structure tends to reflect what
the majority thinks is right and wrong. In a democratic society, going
against that popular opinion can result in one losing the next election.

Now it's a highly contested issue, so it's become one more divisive
political point.


Ed,

Did you see the Op-Ed piece that our old Spartan college mate David
Stockman wrote for the NYT? Lists the four things that Republicans
have done to ruin the economy. I can't quite figure out if he's
defending his stance or complaining that no one listened to him

Probably has a book coming out.

Karl Pearson

Yes, he has a book coming out on the financial crisis. The interesting part
of that op-ed:

http://www.nytimes.com/2010/08/01/op...ate s_economy

....is that he doesn't mention his own involvement in fostering the whole
mess when he was Reagan's budget director. g

It is, however, a very good and very succinct explanation of how we got
where we are. The only objection I have to it is that he doesn't mention the
*other* way you get out of a tailspin like this, and the preferred way,
which is economic growth. Perhaps he says more about it in his book, and
perhaps what he says is that there's no way to get enough growth to get out
of debt, without a lot of belt-tightening and pain.

I'll look forward to reading the book.

--
Ed Huntress