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Comment by morgante | Hacker News Reader

> In the most basic sense, how much should I be allowed to do what I want with my own money?

It's not your money once you're dead. As far as I'm concerned, dead people don't have any rights.

> A step more liberal: Inheritance (the accumulation of wealth by a family), again, AFAIK, is an important part of upwards mobility.

On the contrary, I think it hurts economic mobility a lot more than it helps. If you're competing for opportunities with people who inherited millions of dollars (without doing anything themselves), it's a lot harder to advance yourself.

Non-rich people don't generally leave enough of an estate for it to matter in the first case. We could easily exclude the first $100k for that matter.

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> Non-rich...

Right. Like I mean, it's more complicated than a straight 100%.

For example: What if I transfer my wealth to my family BEFORE my death? What if I set up a trust to manage properties so that my descendants don't own it, but benefit from it? (What if those properties produce their own cash-flow, which goes to my descendants, but they still don't own the property?).

Let's take another example. Let's take Cliff's Variety store in the Haight. Do you think it's worth more than $100k? Do you think they bought/built it for <$100? (hint: no, it's been around in one form or another since before WWII). It's been in that family for generations; it's still in that family. Should it stay in that family? If the current owners die suddenly, before they can transfer ownership, what should happen?

What if my parent owns a company, and I work for that company adding substantial value - like, say, Dr Bronner's soap company? How much of that company's value do I deserve as inheritance, or by ownership, given my contribution?

People live a long time now. I don't have to have the millions of dollars to make you compete for opportunities against my with the benefit of that. Parents (and grandparents, and reasonably, great-great-grand parents) can pay for my education. Or buy me houses. Or not buy me houses - buy themselves houses - and then let me stay there; and this problems is just going to get worse as longevity increases.

As mentioned earlier, you're going to have to completely ban (ie tax 100%) gift-giving too. Or any sale of property that government auditors haven't determined is completely equitable. A trustee would have to be appointed immediately upon diagnosis of terminal disease - someone might "give away the farm" so to speak.

I don't want to live in your world.

Yes, we would have to tax cumulative gifts aggressively as well. To deal with things like real estate gifts, we could force the recipient to pay taxes on the difference between the grand list price and the purchase price.

I don't particularly like living in a world where my hard work is confiscated at a high rate while someone who just has the good fortune of wealthy parents can receive millions tax free.

And you would also get to tax charity just as heavily. Because charity is all about giving gifts.

I have no interest in living in your dream world of justice. As it would have been a totalitarian nightmare where everybody would be worse off.

Ideally charities should benefit people besides your progeny.

I really don't understand why you're so vehemently protective of inherited wealth. Do you think it's abhorrent that Bill Gates is voluntarily donating most of his wealth to charity instead of leaving it to his children?

Why do you think an inheritance tax is "totalitarian?" At least, why is it any worse than income taxes?

You are being disingenuous when comparing "willfully donating" and 100% inheritance tax.

I don't care what people do with their property out of their own free will.

I do care when people are trying to instate authoritarian totalitarian governments.

I oppose inheritance tax - as that inheritance has already been taxed at least once.

I have plenty of good solid arguments on my side.

And I would advise you to put a bit more thinking into your ideas.

There's no need to get into ad hominem attacks.

If you have so many "good solid arguments" on your side, I'd love to hear them. Or answer my question of why they're so much worse than income taxes.

Why do you think that an inheritance tax implies an "authoritarian totalitarian government?" It's a total non sequitur. Does Denmark have an authoritarian government because they impose a high income tax?

Inheritance tax per say does not imply authoritarian totalitarian government. 100% inheritance tax does. Work out the details yourself.

Your conflation of income and inheritance tax is disingenuous.

My crown argument against inheritance tax is that the property being inherited has already been taxed before.

Another would be that taxing inheritance destroys capital base, which no society really wants.

Third would be that governments are really bad at managing capital. There are plenty of issues in the nordic models, where there are already signs that their massive welfare states are going to implode in the next couple of decades.

p.s.: How is me remarking that you have poorly thought out positions an ad-hominem?

> Inheritance tax per say does not imply authoritarian totalitarian government. 100% inheritance tax does. Work out the details yourself.

Why? What is the taxation level where the government is automatically authoritarian? 99%? 90%? 80%?

You can't just assert things and then not provide a causal chain.

What makes double taxation an unmitigated evil? Sales taxes are double taxes, as are taxes on corporate dividends. Yet I don't hear people railing about how they're symptomatic of an authoritarian regime.

> Another would be that taxing inheritance destroys capital base, which no society really wants.

How does it "destroy" capital base? Redistribution of wealth does not equal destruction of wealth.

I agree that many governments do manage their capital poorly. Instead of having government hold on to the capital, I'd say we should collect all estate taxes and channel them into an annual basic income for all citizens. Let the living decide how to use the money.

> p.s.: How is me remarking that you have poorly thought out positions an ad-hominem?

It's not attacking the merits of the argument but instead the thinking of the arguer. I have actually thought about this quite a bit.

I am not going to engage in this discussion anymore as you have convinced me that you are arguing in bad faith.

p.s.: for readers - see what Milton Friedman had to say on the very topic, to a person that seems very much on the same level as some of the contributors to this thread: https://www.youtube.com/watch?v=MRpEV2tmYz4

If Mark Zuckerberg and his wife is hit by a truck tomorrow. Is the US government taking over FB? Cause I don't see the kid getting $50 billion to pay the tax bill.

Obviously, he can sell stock to pay the tax bill. Or the government could directly take ownership and sell the stock.

We have an existing estate tax. It's not a novel concept.

The economic incentives that come with high estate tax encourage rent-seeking and quick cash-outs versus long-term building.

Russian oligarchy is an illustration of this - the inheritance tax is effectively 100%, with the understanding that the property can be taken and re-gifted away any day, so most enterprises are stripped of their cash as soon as possible with money redirected towards conspicuous consumption.

Stripping enterprises of their cash quickly is hardly an example of rent-seeking. If money is directed towards conspicuous consumption, it recirculates into the economy. I definitely consider that superior to inflating unearned fortunes.

The Russian example seems to be more a testament to the danger of unstable political regimes, not the problems of a high inheritance tax.

You're proposing that a) Selling $50 billion worth of stock in a company, b) Government takes ownership of Facebook, or some combination thereof of the two actions.

Yes, it is novel to do that.

I didn't suggest that the government should own Facebook over the long term. It should simply impose a tax on the estate, which would require that stock be liquidated to meet that obligation.

There's already a 40% inheritance tax. How do you think it works in the status quo?

The difference is in the number. 40% means that I can realistically leverage my own share of the stock to get money and pay the tax. 100% means that I walk away and the government can figure out what to deal with the ownership.

I don't know why you think it would be so hard for the government to deal with the ownership. There are plenty of people who would be interested in buying Facebook stock.

Plenty of estates have to be liquidated to settle debts and taxes today. It's hardly unprecedented.

No it isn't precedented. Ownership of a company is a lot different than real estates or other physical wealth.

It would take years to sell off $50 billion of stocks without crashing the company. Even if they are patience and manage to do that, alot of people, myself included, would have trouble with the government being in de-facto control of the company.

If you dismissed either of the two reasons above, I guess I don't see a point in continuing the discussion.

Uh, do you honestly think that estates never include equity holdings?

I agree. It's not worth continuing this discussion if you believe that it takes 10 years to sell off $50 billion of stocks.

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