<story><title>Chuck Feeney Is Now Officially Broke</title><url>https://www.forbes.com/sites/stevenbertoni/2020/09/15/exclusive-the-billionaire-who-wanted-to-die-brokeis-now-officially-broke/#2d2d3103a2aa</url></story><parent_chain><item><author>settrans</author><text>An Open Letter from Economists on the Estate Tax&lt;p&gt;To whom it may concern:&lt;p&gt;Spend your money on riotous living – no tax; leave your money to your children – the tax collector gets paid first. That is the message sent by the estate tax. It is a bad message and the estate tax is a bad tax.&lt;p&gt;The basic argument against the estate tax is moral. It taxes virtue – living frugally and accumulating wealth. It discourages saving and asset accumulation and encourages wasteful spending. It wastes the talent of able people, both those engaged in enforcing the tax and the probably even greater number engaged in devising arrangements to escape the tax.&lt;p&gt;The income used to accumulate the assets left at death was taxed when it was received; the earnings on the assets were taxed year after year; so, the estate tax is a second or third layer of taxation on the same assets.&lt;p&gt;The tax raises little direct revenue- partly because the estate planners have been so successful in devising ways to escape the tax. Costs of collection and compliance are high, perhaps of the same order as direct tax receipts. The encouragement of spending reduces national wealth and thereby the flow of aggregate taxable income. These indirect effects mean that eliminating the tax is likely to increase rather than decrease the net revenue yield to the federal government.&lt;p&gt;The estate tax is justified as a means of reducing the concentration of wealth. However, the truly wealthy and their estate planners avoid the tax. The low yield of the tax is a testament to the ineffectiveness of the tax as a force for reshaping the distribution of wealth.&lt;p&gt;The primary defense made for the estate tax is that it encourages charity. If so, there are better and less costly ways to encourage charity. Eliminating the estate tax will lead to higher economic growth, which is the most important variable in determining the level of charitable giving.&lt;p&gt;Death should not be a taxable event. The estate tax should be repealed.&lt;p&gt;Signed,&lt;p&gt;Milton Friedman</text></item><item><author>bedhead</author><text>I’ve long argued for massive estate tax rates on large estates in order to incentivize behavior like this. I have no problem at all with Bezos being worth $200 billion (or whatever it is now), but it’s this dynastic wealth that I find borderline sickening. Why in the hell should the Rockefeller’s of today be billionaires??? Also, these giant charitable foundations&amp;#x2F;family offices are similarly off-putting, as they are setup as semi-perpetual institutions that often only make the minimum 5% distribution annually. (Another fix would be to jack that up to 25% upon death) Big estate taxes seem to solve for a lot of problems with appropriate compromises.</text></item></parent_chain><comment><author>sixstringtheory</author><text>&amp;gt; The basic argument against the estate tax is moral. It taxes virtue – living frugally and accumulating wealth&lt;p&gt;Only insofar as you believe taxation to be a moral commentary. If one thinks taxation is punishment for a decision, then I can see why one might see it this way.&lt;p&gt;I don&amp;#x27;t agree, though. Taxation is reinvestment into the society that makes the usage of that tool–money–possible in the first place. I think it&amp;#x27;s morally wrong to sequester a social tool in the hands of a few people who never made the investment to get that return in the first place, i.e. children of wealthy parents. I think it&amp;#x27;s morally wrong for anyone to get to pick and choose who will start out having already won the race. This is different from me being a bad business owner and people choosing not to do business with me.&lt;p&gt;Should parents be able to spend their earned money on their childrens&amp;#x27; upbringing? Of course. If a wealthy parent dies should they be able to leave money behind for their children to have a decent shot at life? Absolutely. Does that require millions or billions of dollars to be hoarded, unused, passed from hand to hand, contributing to a skewed money supply that forces the fed to print more, play with interest rates etc to try to keep the system stable? No, I think there&amp;#x27;s a reasonable amount that the government can request returned.&lt;p&gt;Now, the _amount_ of tax is certainly debatable. But to take the extremist position of repealing the tax altogether is absurd IMO.</text></comment>
<story><title>Chuck Feeney Is Now Officially Broke</title><url>https://www.forbes.com/sites/stevenbertoni/2020/09/15/exclusive-the-billionaire-who-wanted-to-die-brokeis-now-officially-broke/#2d2d3103a2aa</url></story><parent_chain><item><author>settrans</author><text>An Open Letter from Economists on the Estate Tax&lt;p&gt;To whom it may concern:&lt;p&gt;Spend your money on riotous living – no tax; leave your money to your children – the tax collector gets paid first. That is the message sent by the estate tax. It is a bad message and the estate tax is a bad tax.&lt;p&gt;The basic argument against the estate tax is moral. It taxes virtue – living frugally and accumulating wealth. It discourages saving and asset accumulation and encourages wasteful spending. It wastes the talent of able people, both those engaged in enforcing the tax and the probably even greater number engaged in devising arrangements to escape the tax.&lt;p&gt;The income used to accumulate the assets left at death was taxed when it was received; the earnings on the assets were taxed year after year; so, the estate tax is a second or third layer of taxation on the same assets.&lt;p&gt;The tax raises little direct revenue- partly because the estate planners have been so successful in devising ways to escape the tax. Costs of collection and compliance are high, perhaps of the same order as direct tax receipts. The encouragement of spending reduces national wealth and thereby the flow of aggregate taxable income. These indirect effects mean that eliminating the tax is likely to increase rather than decrease the net revenue yield to the federal government.&lt;p&gt;The estate tax is justified as a means of reducing the concentration of wealth. However, the truly wealthy and their estate planners avoid the tax. The low yield of the tax is a testament to the ineffectiveness of the tax as a force for reshaping the distribution of wealth.&lt;p&gt;The primary defense made for the estate tax is that it encourages charity. If so, there are better and less costly ways to encourage charity. Eliminating the estate tax will lead to higher economic growth, which is the most important variable in determining the level of charitable giving.&lt;p&gt;Death should not be a taxable event. The estate tax should be repealed.&lt;p&gt;Signed,&lt;p&gt;Milton Friedman</text></item><item><author>bedhead</author><text>I’ve long argued for massive estate tax rates on large estates in order to incentivize behavior like this. I have no problem at all with Bezos being worth $200 billion (or whatever it is now), but it’s this dynastic wealth that I find borderline sickening. Why in the hell should the Rockefeller’s of today be billionaires??? Also, these giant charitable foundations&amp;#x2F;family offices are similarly off-putting, as they are setup as semi-perpetual institutions that often only make the minimum 5% distribution annually. (Another fix would be to jack that up to 25% upon death) Big estate taxes seem to solve for a lot of problems with appropriate compromises.</text></item></parent_chain><comment><author>smillbag</author><text>&amp;gt; The basic argument against the estate tax is moral. It taxes virtue – living frugally and accumulating wealth.&lt;p&gt;Is there something virtuous about hoarding wealth?</text></comment>