The President’s plan to repeal the estate tax isn’t just bad tax policy, it’s un-American. The estate tax plays an integral role not just in reducing inequality, but also in preventing the rise of a permanent moneyed aristocracy like those which exist in so many other countries in the world. When we broke from England in 1776, our Founding Fathers envisioned a country where a person’s talent and hard work would be what determined their success in life, not their parentage. This is a widely held principle of American life, but perhaps President Trump, whose most significant financial accomplishment to date has been inheriting his father’s money, feels differently.
If you want to see a world without the estate tax, you only have to look at England in the 19th century and before. You will see a permanent, entitled upper class who held a monopoly on wealth and a lower class trapped in poverty and servitude. Moving up economically was virtually impossible and those at the top considered themselves to be superior to everyone else which gave them the “right” to treat those less fortunate as though they were not human.
The argument could be made that the vast majority of the people who came to these shores in the past 400 years, did so to escape this situation. They came for opportunity. The opportunity to succeed economically that was denied to them in their homelands. It was denied because of inherited wealth which prevented a level playing field.
For over two centuries, the United States has been a beacon of liberty and opportunity to the rest of the world not just because of our democratic government, but also because it was one of the few places in the world where economic opportunity was widely available. People across the world have moved here not only to escape persecution or to gain political rights, but to guarantee a better, more prosperous future because that future simply wasn’t attainable in their old home.
But that economic opportunity is fading for all but the wealthiest Americans. While it’s certainly possible to work your way up to wealth from poverty, it’s more difficult than ever. Economic mobility in this country is now worse than in most European states, and it will only become worse if we repeal the estate tax. By repealing the estate tax, Congress would only be contributing to the already unsustainable levels of inequality in our society, which hurt everyone, not just the poor.
The estate tax plays an important role in leveling the playing field, improving life for all Americans. Some of the most successful people in our history would not have had the opportunity they needed if this country allowed the unfettered flow of wealth from one generation to the next. And the estate tax does not tax anything under $11 million, allowing family farms and small businesses to pass down without problem. In a way, the estate tax even creates jobs, as most wealthy people buy life insurance to help pay the estate tax. Insurance companies invest this money in stock, supplying capital to companies to expand and add jobs. Why, at a time when so many Americans are struggling to get by, is Congress focused on helping the richest of the rich avoid paying their fair share? Our representatives should be working to level the playing field and reduce inequality, not the other way around.
We are, and always have been, the land of opportunity. Nothing threatens that more that the repeal of the estate tax.