Your Inheritance - Just Like Hitting the Lottery!

During an appearance on the O'Reilly Factor, Congressman Anthony Weiner (D-NY) said that since those who inherit their parents' money did nothing to earn it, it was like hitting the lottery and they should pay estate taxes on it. This is his justification for a 35% estate tax on inheritance over $10 million. (The Democrats originally were hoping to get 55% on estates of $5 million or more.) Before I continue, let me just say that at 47, it looks like the chances of me leaving an estate of over $10 million to my kids someday aren't very good, so I really don't have a dog in this fight. However, the difference between right and wrong doesn't depend on whether or not I have a personal stake in the matter.

Although I believe it is a compelling argument, I will ignore the fact that an estate has already been taxed as income every year that it was accumulated. I'd rather focus on the contention of Representative Weiner that the children did nothing to earn the money and his unspoken implication that $10 million is more than enough money.

First, I would argue that, at least in my experience, many children help with the family business. Small businesses and farms are traditionally a family affair and kids that work after school in their parents shops, wake at 4 AM to milk the cows, or spend their college summer breaks helping run the family farm or business would certainly disagree with Mr. Weiner's opinion that they have done nothing to earn the money.

Next, I would point out that, even if the children never worked a day to help their parents build the estate, they surely paid a price in missed dance recitals, school plays, sporting events, fishing trips, family vacations, etc., that one or both of the parents had to forego in order to be successful. There is a cost associated with spending time away from one's family; one borne by both parent and child.

Lastly, I contend that, contrary to what liberals fomenting class warfare would have you believe, $10 million isn't really that much money when it comes to a family business. For example, a certain 6 acre lot that I know of in my town on a busy main road is being sold for $6 million dollars. That is a suitable size and location one would need to run a small car dealership. And the building on this particular property doesn't have the required service bays or garage space which would need to be add and would add to the cost of the facility. Then there is the matter of the inventory. 150 cars is not a huge dealership and according to the Detroit Free Press, the average new car price in 2010 was $29,217 so the inventory value alone would be more than $4 million. Without even including home value, personal property, or life insurance benefit, it is easy to see that the value of one's estate can quickly exceeded $10 million as it did in this example. With the 35% estate tax, the children would have to come up with $3.5 million dollars to pay their tax bill which will most likely mean having to sell the family business. A reasonable valuation of an estate comprised of a small family farm would produce a similar result.

I think it is clear that, once again, the liberal justification for taking your money doesn't add up. Contrary to Congressman Weiner's veiled assertion, $10 million isn't a lot of money when one considers an estate that is comprised of a family business or farm. Further, even if inheriting children never worked a day in the family business or on their family's farm - a scenario I consider highly unlikely - the time spent by parents working instead of with the family exacts a toll on their children far in excess of the price of a $2 lottery ticket. I would hope Representative Weiner's children think so too.

An Alternate Definition for Politics

The website http://www.merriam-webster.com/ gives its first definition for "POLITICS" as:
1.
       a : the art or science of government
       b : the art or science concerned with guiding or influencing governmental policy
       c : the art or science concerned with winning and holding control over a government                                                  

I'd like to offer an alternative definition: Politics is the art or science of government interference causing events or actions to take place that ordinarily would not (and often should not) occur. This typically means programs that violate the laws of economics or science and it is parts b and c of Webster's definition that causes us so much trouble. Granted, in some very specific cases it is necessary for government to step in despite all its inherent inefficiencies because those particular services are essential but would not be provided by the free market. The national defense is perhaps the best example of a necessary government function that would not be met by the free market. On the other hand, bridges to nowhere, the pursuit of "social justice" and programs like cash for clunkers, subsidized corn-based ethanol, government support for the production of electric cars or controversial art such as the depiction of Jesus with ants crawling over him (produced with a grant from the National Endowment for the Arts) would never take place without government intervention because they have no economic, social or scientific merit. Too often, the impetus for the government involvement is to reward political contributors and special interests or to advance a certain ideology.

The liberal icon, Robert F. Kennedy, often said, "Some men see things as they are and ask why? I dream of things that never were and ask why not?" While this paraphrase of George Bernard Shaw makes for colorful oratory and great political rhetoric, its most valuable contribution is in providing a window into the mind of the political Left. It seems to indicate that it is more noble to ask the second question and implies that the dreams that never were - should be - and that government can make them happen. The problem is both questions need to be asked but most importantly, they need to asked without assuming the answer to either indicates some injustice that government should correct. It is the line of thinking that ignores the laws of economics, science and nature and assumes the answers are evidence of injustice, combined with the political reward system that has evolved among our political class that has delivered us the social, economic and governmental crisis we find ourselves in today.

Like many, I occasionally dream at night that I can fly or float and when I wake in the morning to remember I can't, I understand why. However, I don't petition Congress to pass a law against gravity.

More Isn't Necessarily Better

Someone once said, "When the only tool you have in your tool bag is a hammer, every job looks like a nail." And so it is with our legislators - their only tool is new law. It doesn't matter that typically there are already laws in place that have been violated, haven't been enforced, or have been ignored. From illegal immigration, to gun control, to environmental protection, to Wall St reform, when current law proves to be ineffective, obviously the solution is thousands of pages of additional legislation.

This proclivity to answer bad law with even more bad law isn't restricted to Congress. I recently heard a local Virginia State legislator discussing a law he sponsored requiring all State and local agencies to verify the immigration status of anyone before they can be hired. The gentleman (I wish I could recall his name) told WMAL talk show hosts Fred Grandy and Bryan Nehman that he had a feeling that the law was being ignored. He went on to say that when he looked into it, sure enough, not a single agency was following the law. Fortunately, he said, he was introducing a new bill that would order the agencies to follow the original law. I was astounded! Why didn't he also put them all on "double secret probation."

When Congress began ramming through legislation such as Healthcare reform and the Stimulus package which were becoming increasingly unpopular with the public, conservative Americans coined a clever turn of a phrase, "Don't just do something! Stand there!" It was meant to be witty which I believe it was but it also contained a not so subtle message - sometimes doing nothing is the right thing to do! Unfortunately for them (and fortunately for the country), the House wasn't in the "receive-mode" but they sure got the follow-on message November 2nd!

Ideas To Help a Congress Out of Control

1. One legislative item per bill; Don't even think about a "comprehensive" anything!
2. Limit the length of a bill to "x" number of pages.
3. Bills must be written by a Representative or Senator - not staff. The Devil makes use of idle hands. What are they doing if they aren't writing or even reading bills?
4. Bills must me written by hand - reduce the temptation to write on and on with the help of technology.
5. Senators and Representatives must sign an affidavit attesting that they have read a bill (in Toto) before they can vote on it.

6. If they can't reform themselves, amend the Constitution so that Representatives are selected like a jury for a period of 2 years. If an average citizen is good enough to sit in judgement of another citizen and possible sentence them to death, certainly they are capable of writing a few laws. My guess is most Americans would be willing to take a couple years out of their normal life and make $183,000 a year.
William F. Buckley Jr once said, "I'd rather be governed by the first one hundred names in the Cambridge phonebook than the faculty of Harvard." I think he may have been on to something!

They Just Can't Help Themselves from Helping Themselves

On December 6th, President Obama announced that he was going to compromise with the Republicans and extend the Bush era tax rates for all Americans in exchange for extending the unemployment benefits another thirteen months. Within minutes, our "principled" Congressmen and women, Left and Right, began caterwauling about "tax breaks for the rich" and the cost of extending the unemployment benefits. They took to the microphones and Sunday morning talk shows and decried their political opponents' lack of compassion or lack of fiscal discipline; each trying to claim the moral high ground. They spoke as if the very idea of this compromise put a nasty taste in their mouths.

Senator Reed said that there was a lot of work that needed to be done in order to make this deal viable. Silly me! I assumed he meant that our legislators would have to spend long hours working on the language to get it just right. No, what Senator Reed meant was the real work of Congress - not crafting law but political wheeling and dealing. Now less than a week later the fruits of their labor are becoming apparent. The bill received a test vote in the Senate and was approved thanks to billions of dollars worth of pork-laden earmarks. These people just can't help themselves! Funny how bacon makes everything taste better, isn't it?

MORE TAXES VERSUS CHARITABLE CONTRIBUTIONS - BILLIONAIRES REVEAL THEIR TRUE PREFERENCE!

When I used to hear the super wealthy like investor Warren Buffet say that income taxes should be increased and that he wouldn't mind paying higher income taxes, I always thought, "Be my guest! No one is stopping you from writing an extra check to the federal government every April 15th." Of course that never happens.

The truth of the matter is that increasing the marginal income tax rates for the wealthy (what is really meant when tax increases are discussed) would do little to change the amount of taxes paid by the ultra rich like Mr. Buffet. The reason is simple. Income taxes are paid on "earned" income i.e. salaries and bonuses while the vast majority of the income of the very wealthy like Warren Buffet comes from passive income - dividends, capital gains and interest - which would not be affected. How generous to offer to pay higher rates on taxes you don't pay! Those really paying the higher taxes would be...that's right, the middle class who derive most of their income from wages.

Now I see in the news that Buffet, Bill Gates, Ted Turner and several others who frequently voice their willingness to pay more taxes have joined The Giving Pledge which is a campaign for the wealthiest individuals and families to pledge to give half their wealth to charity. I applaud the generosity of The Giving Pledge donors as I have always believed that charitable giving is a far better way to do good than paying taxes to a bloated, wasteful and overly bureaucratic government.

But I have to ask, "Why are Buffet et al giving their fortunes to charity instead of paying more in taxes like they advocate?" Could it be that they believe as Leona Helmsley once said, "Taxes are for the 'little people.'?

Bring Back The R-Word!

Recently, the R-word has been declared verboten by the politically correct Left. Pity! Sometimes there just isn't a better word to describe someone. When I hear a politician state that unemployment checks and food stamps have the biggest "bang for the buck" of any government spending or that they return $1.60 for every $1 spent, I'm hard pressed to come up with a better word to describe them than "retard". Clearly, their assertion makes no sense or we could simply grow our way out of this recession by putting everyone on unemployment and food stamps!

Ronald Reagan once said, "The trouble with our liberal friends is not that they are ignorant, but that they know so much that isn't so." I only advocate the use of the R-word to describe those who believe something when they really ought to know better. Therefore, we must bring back the R-word or what other word would we have to sufficiently describe someone like the liberal Speaker of the House, Ms. Pelosi? Wait! I think I just answered my own question. Never mind!