America's wealthiest families are pouring millions into slashing the estate tax

JI7

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Sat May-30-09 08:27 AM
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America's wealthiest families are pouring millions into slashing the estate tax

On a bright April day in Barack Obama's America, where equality is on the rise and greed is on the run, a Democratic senator from an impoverished Southern state took a brave stand — on behalf of the country's richest families.

On April 1st, Sen. Blanche Lincoln of Arkansas, a state with the nation's third-lowest median income, sponsored a budget amendment that would sharply reduce taxes on the estates of multimillionaires after they die. Estates worth up to $7 million per couple, and $3.5 million for individuals, are already exempt from taxes — meaning that 99.75 percent of all Americans die without paying a dime to Uncle Sam. But Lincoln's proposal would raise the exemption to $10 million — and slash the tax rate on even larger estates from 45 percent to 35 percent. All told, the move would let the children of Wall Street barons, dot-com millionaires and wealthy industrialists pocket more than $90 billion in tax revenues over the next decade.

The families behind the estate-tax repeal — working in concert with right-wing anti-tax ideologues — are attempting to undo a century-old consensus about taxing huge inheritances, one borne of the progressive movement in the late 19th century. The Gilded Age produced such huge concentrations of wealth that even its biggest winners agreed that they should share their fortunes rather than simply pass them along from one generation to another. Among those making the case was Andrew Carnegie, whose steel fortune dominated the nation's economy at the time. "The parent who leaves his son great wealth generally deadens the talents and energies of the son, and tempts him to lead a less useful and less worthy life than he otherwise would," Carnegie wrote, adding on another occasion that he "should as soon leave to my son a curse as the almighty dollar." The estate tax also became a cause of Teddy Roosevelt, who argued that vast fortunes passed between generations cause "great and genuine detriment to the community at large." Convinced that massive inheritances offended America's egalitarian principles, Congress authorized the first estate tax in 1916.

Many of the families are household names. There is the Mars family, makers of M&Ms and other candy, who would avoid $10 billion in estate taxes. There is the Gallo family, whose winemaker patriarch hoped to save an estimated $500 million from abolishing the tax. There are the Nordstroms, of department-store fame; the Dorrances, makers of Campbell's soup; and the Wegmans, owners of supermarkets by the same name. And there is the Walton family, owners of Walmart, a clan whose worth may exceed $75 billion. Their personal profit from repealing the estate tax would total $30 billion — roughly the gross domestic product of Jordan.

http://www.rollingstone.com/politics/story/28418678/the_death_tax_scam