Estate Tax... Again! Woo!!

[2dimes]

It's not like we tax people at 100% for making more than X amount of money.

Isn't that why Gerard Depardeu left France?

[thegreekdog]

This is really an ideological issue more than anything else.

Does it really make sense to tax someone, again, on money that has already been taxed? Sort of. Your sales tax payments, for example, are from money on which you generally pay income taxes. (there are exceptions, but unless the amounts are high, rarely employed). Money tends to be taxed when it is exchanged.

On the other hand, it impacts relatively few people and therefore is a sort of "easy" way for politicians to extract more taxes.

Per the "I earned it, I deserve to pass it on..". Maybe, but at the same time, giving your kids or grandkids a lot of money at once is generally a bad idea. It tends to result in bad consequences more often than good ones.

What I really like about greekdog's proposal is that he distinguishes between immaterial and material assets. I would keep estate taxes, or reinstate them to prior levels, but give exceptions for businesses and some homes. (note, I say "home", not "house" to clarify that I mean a place where the deceased actually lived, at least prior to being in a nursing home or such).

That said, if my folks could avoid paying estate taxes... I don't think its that difficult to do. Mostly, it involves creating a trust with all the parties signatories.

My point in that example was that the same money gets taxed multiple times regardless of whether there is an estate tax or not. Pretty much every time money changes hands it gets taxed at least once (e.g. a dividend) and sometimes twice (e.g. corporation's income tax and dividend or personal income tax and sales tax).

Which is my point. Why treat an estate windfall as different from anything else?

Why should the government tax income which is inherited at a far higher rate than income that was worked for? Does the US government tax people who won the lottery at a different rate?

I don't see why it shouldn't be treated as any other income and taxed as such.

I think it should be taxed at a higher rate (100% in fact). But yeah, there is nothing special about an inheritance that makes it more worthy of not being taxed.

What is the rational for taxing it at a higher rate?

I don't think it should be exempt, but I also don't see why it should be taxed at 100%. It's not like we tax people at 100% for making more than X amount of money.

It's not earned income (by any stretch of the imgination and we don't live in an aristrocracy. And we need the money.

[Baron Von PWN]

It's not like we tax people at 100% for making more than X amount of money.

Isn't that why Gerard Depardeu left France?

I think he left due to 75% taxes.

[Baron Von PWN]

This is really an ideological issue more than anything else.

Does it really make sense to tax someone, again, on money that has already been taxed? Sort of. Your sales tax payments, for example, are from money on which you generally pay income taxes. (there are exceptions, but unless the amounts are high, rarely employed). Money tends to be taxed when it is exchanged.

On the other hand, it impacts relatively few people and therefore is a sort of "easy" way for politicians to extract more taxes.

Per the "I earned it, I deserve to pass it on..". Maybe, but at the same time, giving your kids or grandkids a lot of money at once is generally a bad idea. It tends to result in bad consequences more often than good ones.

What I really like about greekdog's proposal is that he distinguishes between immaterial and material assets. I would keep estate taxes, or reinstate them to prior levels, but give exceptions for businesses and some homes. (note, I say "home", not "house" to clarify that I mean a place where the deceased actually lived, at least prior to being in a nursing home or such).

That said, if my folks could avoid paying estate taxes... I don't think its that difficult to do. Mostly, it involves creating a trust with all the parties signatories.

My point in that example was that the same money gets taxed multiple times regardless of whether there is an estate tax or not. Pretty much every time money changes hands it gets taxed at least once (e.g. a dividend) and sometimes twice (e.g. corporation's income tax and dividend or personal income tax and sales tax).

Which is my point. Why treat an estate windfall as different from anything else?

Why should the government tax income which is inherited at a far higher rate than income that was worked for? Does the US government tax people who won the lottery at a different rate?

I don't see why it shouldn't be treated as any other income and taxed as such.

I think it should be taxed at a higher rate (100% in fact). But yeah, there is nothing special about an inheritance that makes it more worthy of not being taxed.

What is the rational for taxing it at a higher rate?

I don't think it should be exempt, but I also don't see why it should be taxed at 100%. It's not like we tax people at 100% for making more than X amount of money.

It's not earned income (by any stretch of the imgination and we don't live in an aristrocracy. And we need the money.

So if Mr.Moneybags signs over all his money/wealth to Mr.Moneybags jr, before he dies mind you, should this be taxed at 100%? What if he signs it over to a third party before he dies?

If not why not? and why would it matter that this decision is made before he dies, rather than pre-determined to take effect on his death?

Since when does the government decide what is "earned" and not earned income? (under current rules such a transaction of over $1 million, in the USA, would be taxed at 35% )

[Night Strike]

Or we could get rid of all personal taxes and replace them with a sales tax and then it won't matter how much people inherit from others as every dollar will be taxed when spent.

[2dimes]

Seems invasive. Do you want to pay tax on birthday gifts. What happens if you can't afford the tax? Sorry you should have been saving up. You knew your birthday was coming.

[thegreekdog]

Okay, so here's the full plan (which is still in process):

- The estate and gift tax is imposed at a rate of 100% of your "qualified estate."
- There is an exemption of $5 million, which goes untaxed, of your "qualified estate."
- The term "qualified estate" is defined as the liquid assets of a deceased person that go to an individual or for-profit entity. Therefore, liquid assets that go to a non-profit entity are not part of the qualified estate and are thus not subject to tax.
- You may give gives of up to $5 million over the course of your life to an individual or for-profit entity, which uses up your exemption upon death. So if Individual A gifts $1 million to Individiual B, Individual A's exemption upon death is now $4 million.
- The term "liquid assets" is defined as the cash or cash equivalents, including, but not limited to cash, public stocks, bonds, notes, and debentures. Real and tangible personal property are not considered liquid assets. Such non-liquid assets are not subject to tax and are freely transferable.

[thegreekdog]

Or we could get rid of all personal taxes and replace them with a sales tax and then it won't matter how much people inherit from others as every dollar will be taxed when spent.

This would be pretty brutal I think. We would need to think about the benefits of a VAT as compared to a sales tax.

[AndyDufresne]

Words to live by:




--Andy

[Metsfanmax]

What is the rational for taxing it at a higher rate?

I don't think it should be exempt, but I also don't see why it should be taxed at 100%. It's not like we tax people at 100% for making more than X amount of money.

It's not earned income (by any stretch of the imgination and we don't live in an aristrocracy. And we need the money.

I disagree with both of you. The rationale for the estate tax should never have been about making the government more money. It should have been about spending that money before you die, either by directly putting it back into the market, or by donating it to charity. The estate tax is there as a deterrent against just hoarding your wealth instead of giving back to the society that made you rich, at the end of your life.

[thegreekdog]

What is the rational for taxing it at a higher rate?

I don't think it should be exempt, but I also don't see why it should be taxed at 100%. It's not like we tax people at 100% for making more than X amount of money.

It's not earned income (by any stretch of the imgination and we don't live in an aristrocracy. And we need the money.

I disagree with both of you. The rationale for the estate tax should never have been about making the government more money. It should have been about spending that money before you die, either by directly putting it back into the market, or by donating it to charity. The estate tax is there as a deterrent against just hoarding your wealth instead of giving back to the society that made you rich, at the end of your life.

Yeah, that too! Thanks Mets!

[BigBallinStalin]

Hey BBS - I provided for a $5 million exemption. That should be enough to cover those who are not members of the modern aristocracy and those without intelligent tax advisors.

If we want to rob the modern aristocracy of their power, then we must address the fundamental provider of that power: the state--especially the US federal government. Ceteris paribus, giving the state more money through estate taxes only enlarges the politicized pool, which will still be susceptible to rent-seeking (e.g. from those with their hands in the state's coffers and from those with their hands in the politician's pockets). So, these costs of increased taxation may not offset the supposed benefits of a 100% estate tax + $5m or $50m exemption.

(I'll address "laws against tax avoidance" later).

I don't disagree, obviously. The largest impediment to my estate tax plan is the rent-seeking element. Clearly, this proposed rule, complete with "closing" the "loopholes" would be promulgated despite the rent-seekers. A difficult proposition, if not impossible.

But still, bro, "if the legislators write out of the law the exemptions for trusts and gifts, so we've eliminated the ability to avoid the tax," would the benefits still offset the costs?

Who and which groups else benefits from gifts and trusts?
(NS mentions universities and charities, so is your proposal really worth it--rent-seeking ignored ATM).


UHP!:

A 100% estate tax would cause severe damage to charities that receive large donations from estates, especially colleges and universities. Many of these estates that are donated to schools have enough money to fund scholarships and teaching positions for years to come. Some are large enough to fund those things based on its continued interest earnings.*




*Which is actually a major criticism of colleges: continually raising prices when they're rarely dipping into the capital of their endowments.

Exemption for charitable contributions. Problem solved. And it wasn't hard.

I'm sure you and BBS can think of more reasons why rich people should be able to ensure their children are also rich through aristocratic means.

But still... Suppose I'm a rich, old guy. I should set up a charity, which will give x-amount to those on my informal Will, and the remainder to some other charity (which I may own) or to a SuperPAC (which I may own). Hell, I could launder the money through the "charity ---> SuperPAC" avenue and pay myself/teh kiddies as some executive/employee of the SuperPAC. *cha-ching! cha-ching! cha-ching!*

[BigBallinStalin]

What is the rational for taxing it at a higher rate?

I don't think it should be exempt, but I also don't see why it should be taxed at 100%. It's not like we tax people at 100% for making more than X amount of money.

It's not earned income (by any stretch of the imgination and we don't live in an aristrocracy. And we need the money.

I disagree with both of you. The rationale for the estate tax should never have been about making the government more money. It should have been about spending that money before you die, either by directly putting it back into the market, or by donating it to charity. The estate tax is there as a deterrent against just hoarding your wealth instead of giving back to the society that made you rich, at the end of your life.

What a bunch of socialist crap.

If the money is given over to the beneficiaries, then it still goes--at some point--'into the market' via consumption. If some proportion is not, then it is saved. And if it's saved, then someone else is benefiting from the savings (e.g. an investment which earns interest = savings). So, even if the estate is consumed or saved by either the Old Guy or his beneficiaries, it ultimately "goes back" to the economy. Therefore, the "rationale" of your stance is simply irrational.

Besides, why do people say "give back to the society"? What was stolen/borrowed from "society" in the first place? Nothing. That saying makes no sense when it is critically examined.

[BigBallinStalin]

Okay, so here's the full plan (which is still in process):

- The estate and gift tax is imposed at a rate of 100% of your "qualified estate."
- There is an exemption of $5 million, which goes untaxed, of your "qualified estate."
- The term "qualified estate" is defined as the liquid assets of a deceased person that go to an individual or for-profit entity. Therefore, liquid assets that go to a non-profit entity are not part of the qualified estate and are thus not subject to tax.
- You may give gives of up to $5 million over the course of your life to an individual or for-profit entity, which uses up your exemption upon death. So if Individual A gifts $1 million to Individiual B, Individual A's exemption upon death is now $4 million.
- The term "liquid assets" is defined as the cash or cash equivalents, including, but not limited to cash, public stocks, bonds, notes, and debentures. Real and tangible personal property are not considered liquid assets. Such non-liquid assets are not subject to tax and are freely transferable.

Wait, so your physical property is not taxed because it's not a liquid asset?

1. Suppose Mr. MoneyBags has used up his $5 million exemption.
2. Then, he gifts Mr. MoneyBags Jr. $1,000,000.
3. What happens next?
4a. The government taxes Mr. MoneyBags Jr. 100% on the $1 million, or
4b. the $1 million is taxed at 38% (i.e. taxed as income)?

Because if it's 4b, then obviously, I've avoided the 100% estate tax. If we choose 4a, then what? The government demands 100% of the money--even before Mr. MoneyBags dies?

[patches70]

What is the rational for taxing it at a higher rate?

I don't think it should be exempt, but I also don't see why it should be taxed at 100%. It's not like we tax people at 100% for making more than X amount of money.

It's not earned income (by any stretch of the imgination and we don't live in an aristrocracy. And we need the money.

I disagree with both of you. The rationale for the estate tax should never have been about making the government more money. It should have been about spending that money before you die, either by directly putting it back into the market, or by donating it to charity. The estate tax is there as a deterrent against just hoarding your wealth instead of giving back to the society that made you rich, at the end of your life.

What a bunch of socialist crap.

If the money is given over to the beneficiaries, then it still goes--at some point--'into the market' via consumption. If some proportion is not, then it is saved. And if it's saved, then someone else is benefiting from the savings (e.g. an investment which earns interest = savings). So, even if the estate is consumed or saved by either the Old Guy or his beneficiaries, it ultimately "goes back" to the economy.

Besides, why do people say "give back to the society"? What was stolen/borrowed from "society" in the first place? Nothing. That saying makes no sense when it is critically examined.

Haha! Just goes to show how some people think saving is a sin. No wonder our nation is in the mess it's in. Spend! Spend! Spend! And when you run out of money borrow borrow borrow to keep spend spend spending!

God forbid people set money aside for whatever purpose they so wish it. The Statist decides how much money one can have, keep and make. Piss off Statists! You slack jawed yokels. Go make and spend your own money on whatever it is you want and leave everyone else alone.

[patches70]

Okay, so here's the full plan (which is still in process):

- The estate and gift tax is imposed at a rate of 100% of your "qualified estate."
- There is an exemption of $5 million, which goes untaxed, of your "qualified estate."
- The term "qualified estate" is defined as the liquid assets of a deceased person that go to an individual or for-profit entity. Therefore, liquid assets that go to a non-profit entity are not part of the qualified estate and are thus not subject to tax.
- You may give gives of up to $5 million over the course of your life to an individual or for-profit entity, which uses up your exemption upon death. So if Individual A gifts $1 million to Individiual B, Individual A's exemption upon death is now $4 million.
- The term "liquid assets" is defined as the cash or cash equivalents, including, but not limited to cash, public stocks, bonds, notes, and debentures. Real and tangible personal property are not considered liquid assets. Such non-liquid assets are not subject to tax and are freely transferable.

Wait, so your physical property is not taxed because it's not a liquid asset?

1. Suppose Mr. MoneyBags has used up his $5 million exemption.
2. Then, he gifts Mr. MoneyBags Jr. $1,000,000.
3. What happens next?
4a. The government taxes Mr. MoneyBags Jr. 100% on the $1 million, or
4b. the $1 million is taxed at 38% (i.e. taxed as income)?

Because if it's 4b, then obviously, I've avoided the 100% estate tax. If we choose 4a, then what? The government demands 100% of the money--even before Mr. MoneyBags dies?

What if Joe RichDaddy has multiple children, lets say.....six children. Is each child entitled to $5 million each?
Who is the government or TGD to decided how much heirs should get? Does TGD know what's best for people better than the people themselves?

I think not.....

[TA1LGUNN3R]

So, Greekdog, in keeping with the "you didn't earn the inheritance and therefore it's public property stance," what about your body after your death? You didn't earn your body, it was given to you by your parents and upward from there. Should your body be donated (repossessed by the public for public services) to medical science since you are no longer alive?

Just curious about where you set the line at "earned" possessions and how they are dispensed after cessation of life.

-TG

[Metsfanmax]

What is the rational for taxing it at a higher rate?

I don't think it should be exempt, but I also don't see why it should be taxed at 100%. It's not like we tax people at 100% for making more than X amount of money.

It's not earned income (by any stretch of the imgination and we don't live in an aristrocracy. And we need the money.

I disagree with both of you. The rationale for the estate tax should never have been about making the government more money. It should have been about spending that money before you die, either by directly putting it back into the market, or by donating it to charity. The estate tax is there as a deterrent against just hoarding your wealth instead of giving back to the society that made you rich, at the end of your life.

What a bunch of socialist crap.

If the money is given over to the beneficiaries, then it still goes--at some point--'into the market' via consumption. If some proportion is not, then it is saved. And if it's saved, then someone else is benefiting from the savings (e.g. an investment which earns interest = savings). So, even if the estate is consumed or saved, it ultimately "goes back" to the economy.

1) Donations to charity are my ultimate motive here. I just used the idea of putting it back into the market as a secondary reason. Yes, I believe in socialism.

2) I'm not interested in banks making more money off the investment opportunities afforded to them because of savings from rich people. That money needs to be distributed more in the form of actual spending, which is more beneficial to people other than the wealthy.

Besides, why do people say "give back to the society"? What was stolen/borrowed from "society" in the first place? Nothing. That saying makes no sense when it is critically examined.

It is impossible to be as absurdly wealthy as these people are without a stable society and marketplace in which to transfer virtual goods. That wealth is literally owed to the society that made it possible.

[BigBallinStalin]

What is the rational for taxing it at a higher rate?

I don't think it should be exempt, but I also don't see why it should be taxed at 100%. It's not like we tax people at 100% for making more than X amount of money.

It's not earned income (by any stretch of the imgination and we don't live in an aristrocracy. And we need the money.

I disagree with both of you. The rationale for the estate tax should never have been about making the government more money. It should have been about spending that money before you die, either by directly putting it back into the market, or by donating it to charity. The estate tax is there as a deterrent against just hoarding your wealth instead of giving back to the society that made you rich, at the end of your life.

What a bunch of socialist crap.

If the money is given over to the beneficiaries, then it still goes--at some point--'into the market' via consumption. If some proportion is not, then it is saved. And if it's saved, then someone else is benefiting from the savings (e.g. an investment which earns interest = savings). So, even if the estate is consumed or saved, it ultimately "goes back" to the economy.

1) Donations to charity are my ultimate motive here. I just used the idea of putting it back into the market as a secondary reason. Yes, I believe in socialism.

2) I'm not interested in banks making more money off the investment opportunities afforded to them because of savings from rich people. That money needs to be distributed more in the form of actual spending, which is more beneficial to people other than the wealthy.

Besides, why do people say "give back to the society"? What was stolen/borrowed from "society" in the first place? Nothing. That saying makes no sense when it is critically examined.

(3) It is impossible to be as absurdly wealthy as these people are without a stable society and marketplace in which to transfer virtual goods. That wealth is literally owed to the society that made it possible.

(1) You believe in state socialism. I'm actually fine with voluntary socialism, but based on your position, you should be honest/clear with yourself.

(2) Oh, so it's only banks making money because rich people? Anyone can save their money in a bank, and anyone can earn interest on their savings or investment. If the investment, (e.g. stocks or bonds), goes to a company, and if the investor (some rich guy, or some poor guy) earns income on it, then what's wrong here? Nothing. And savings doesn't occur only through banks. See crowdfunding, lending money to your friends, or whatever. There's nothing wrong with saving, and there's nothing wrong with an organization earning money by providing someone the means to save their money, thus earn interest.

You can't only spend (i.e. consume) in order to become a wealthier person. You have to save, and this applies to the economy. Your position is nonsensical because your socialist sentiments are clouding your judgment. Even Marx understood the importance of banks, interest, and saving. He wanted to nationalize them in order to make them more efficient. But you have no understanding, yet for some reason you assert these unreasonable claims.

(3) It's called "exchange." If no theft was committed, then there's no obligation to "give back" since one has already given back--through exchange.

[Metsfanmax]

(1) You believe in state socialism. I'm actually fine with voluntary socialism, but based on your position, you should be honest/clear with yourself.

Thank you for the clarification.

(2) Oh, so it's only banks making money because rich people? Anyone can save their money in a bank, and anyone can earn interest on their savings or investment. If the investment, (e.g. stocks or bonds), goes to a company, and if the investor (some rich guy, or some poor guy) earns income on it, then what's wrong here? Nothing. And savings doesn't occur only through banks. See crowdfunding, lending money to your friends, or whatever. There's nothing wrong with saving, and there's nothing wrong with an organization earning money by providing someone the means to save their money, thus earn interest.

You can't only spend (i.e. consume) in order to become a wealthier person. You have to save, and this applies to the economy. Your position is nonsensical because your socialist sentiments are clouding your judgment. Even Marx understood the importance of banks, interest, and saving. He wanted to nationalize them in order to make them more efficient. But you have no understanding, yet for some reason you assert these unreasonable claims.

This tirade has nothing to do with the estate tax. The question isn't whether you should save or spend; it's what to do with your money right before you die. At that point, saving your money is no longer useful to you because you won't be around to see the returns on your investment. I'm not saying people should live their lives differently*; I'm saying they should give whatever they have left, at the end, back to everyone else.

*Well, I actually am saying that in general, but that's a different story. And see this.

(3) It's called "exchange." If no theft was committed, then there's no obligation to "give back" since one has already given back--through exchange.

Well, I disagree. I believe a debt can be owed without a theft being committed. What now?

[BigBallinStalin]

(1) You believe in state socialism. I'm actually fine with voluntary socialism, but based on your position, you should be honest/clear with yourself.

Thank you for the clarification.

(2) Oh, so it's only banks making money because rich people? Anyone can save their money in a bank, and anyone can earn interest on their savings or investment. If the investment, (e.g. stocks or bonds), goes to a company, and if the investor (some rich guy, or some poor guy) earns income on it, then what's wrong here? Nothing. And savings doesn't occur only through banks. See crowdfunding, lending money to your friends, or whatever. There's nothing wrong with saving, and there's nothing wrong with an organization earning money by providing someone the means to save their money, thus earn interest.

You can't only spend (i.e. consume) in order to become a wealthier person. You have to save, and this applies to the economy. Your position is nonsensical because your socialist sentiments are clouding your judgment. Even Marx understood the importance of banks, interest, and saving. He wanted to nationalize them in order to make them more efficient. But you have no understanding, yet for some reason you assert these unreasonable claims.

This tirade has nothing to do with the estate tax. The question isn't whether you should save or spend; it's what to do with your money right before you die. At that point, saving your money is no longer useful to you because you won't be around to see the returns on your investment. I'm not saying people should live their lives differently*; I'm saying they should give whatever they have left, at the end, back to everyone else.

*Well, I actually am saying that in general, but that's a different story. And see this.

Here's what you said:
" I'm not interested in banks making more money off the investment opportunities afforded to them because of savings from rich people. That money needs to be distributed more in the form of actual spending, which is more beneficial to people other than the wealthy."

You just took a position on spending. You're dictating more than just tax policy (estate tax), so if your position is more than just tax policy (estate tax), then obviously I'll need to expand beyond the estate tax. If you mention spending, then obviously I need to mention more than just spending--because it cannot be just about spending. You can't only spend wealth in order to create wealth. You won't get prosperity if you neglect the saving. Nevertheless, you apparently refuse to consider the role of saving and the implications of your stance. You outright reject any talk about savings.

This conversation requires an understanding of the fundamentals of spending/consumption and investing/saving. If you talk just about spending while declaring that you don't wish to talk about saving, then that's totally ignorant.

(3) It's called "exchange." If no theft was committed, then there's no obligation to "give back" since one has already given back--through exchange.

Well, I disagree. I believe a debt can be owed without a theft being committed. What now?

Then you imagined the debt into existence on the basis of no contract. In order to have an obligation to others in regard to borrowing and lending, then one must have some contract which delineates the duties of each party. Since there's no contract (or an imaginary, nonexistent one), then your reasoning is faulty.
(Note: I expect that you're implicitly basing your reasoning on a normative stance. However, before you launch into a normative (moral) position, you should develop a better understanding through a positive scientific approach on these matters. Otherwise, you'll have no basis for determining the soundness of your normative, moral arguments).

"At that point, saving your money is no longer useful to you because you won't be around to see the returns on your investment."

Let's assume your statement is true. If it wasn't useful, then why would anyone save any money to give away after they die? (Because it's useful to them during the time which they save so that they can give to others in the future). It doesn't matter if they die because that wouldn't negate the usefulness of that wealth to them--and to others to whom they've voluntarily transferred their wealth. You have to consider the actions and plans of individuals throughout the entire time of their lives--not just one fine point.

People can curtail current consumption in order to increase future consumption. This method of savings can be shared among oneself---and to select individuals after one's death. Therefore, the usefulness of saving now for future consumption need not be limited to one's self or future dead body. Obviously, it can be shared, yet it can remain useful to the one who saves. Your statement makes no sense at all.

[Metsfanmax]

Here's what you said:
" I'm not interested in banks making more money off the investment opportunities afforded to them because of savings from rich people. That money needs to be distributed more in the form of actual spending, which is more beneficial to people other than the wealthy."

You just took a position on spending. You're dictating more than just tax policy (estate tax), so if your position is more than just tax policy (estate tax), then obviously I'll need to expand beyond the estate tax. If you mention spending, then obviously I need to mention more than just spending--because it cannot be just about spending. You can't only spend wealth in order to create wealth. You won't get prosperity if you neglect the saving. Nevertheless, you apparently refuse to consider the role of saving and the implications of your stance. You outright reject any talk about savings.

This conversation requires an understanding of the fundamentals of spending/consumption and investing/saving. If you talk just about spending while declaring that you don't wish to talk about saving, then that's totally ignorant.

Fair enough. I have no intention to get into a larger discussion about the proper role of spending versus saving in this thread. I am merely interested in here about how wealth should be distributed once it is no longer needed by the individual who accumulated it.

(3) It's called "exchange." If no theft was committed, then there's no obligation to "give back" since one has already given back--through exchange.

Well, I disagree. I believe a debt can be owed without a theft being committed. What now?

Then you imagined the debt into existence on the basis of no contract. In order to have an obligation to others in regard to borrowing and lending, then one must have some contract which delineates the duties of each party. Since there's no contract (or an imaginary, nonexistent one), then your reasoning is faulty.
(Then you'll bring this to the normative).

I believe there does exist a contract. Social contract theory is alive and well among philosophers thanks to John Rawls. Perhaps ironically, I don't share Rawls' conception of moral justice. I agree that by its nature a society is a contract among its various members, to avoid certain acts in return for collective protection. I disagree that this says anything about ethics at the fundamental level; that is, one is not making a moral statement that said certain acts are inherently wrong, but rather they are just things the society has agreed not to do. Those things may be equivalent to the things we agree are ethically wrong, or they may not be.

This contract is not signed by a pen with anyone, and yet is implicitly agreed to by your continued existence as a member of the nation and participation in its structures.

"At that point, saving your money is no longer useful to you because you won't be around to see the returns on your investment."

Let's assume your statement is true. If it wasn't useful, then why would anyone save any money to give away after they die? (Because it's useful to them during the time which they save so that they can give to others in the future). It doesn't matter if they die because that wouldn't negate the usefulness of that wealth to them--and to others to whom they've voluntarily transferred their wealth. You have to consider the actions and plans of individuals throughout the entire time of their lives--not just one fine point.

If they feel this way, that is precisely what I would like. It is a good thing if the extremely wealthy earn a lot of money with the intent of saving it until shortly before they die, and then sharing it with others. I strongly encourage such behavior; it is the highest of morally honorable behavior. See the article I linked.

[Night Strike]

If they feel this way, that is precisely what I would like. It is a good thing if the extremely wealthy earn a lot of money with the intent of saving it until shortly before they die, and then sharing it with others. I strongly encourage such behavior; it is the highest of morally honorable behavior. See the article I linked.

So it's morally honorable to share that money with "others" or hand it over to the government, but it's not morally honorable to share that money with one's progeny? Why are those individuals excluded from what's honorable? Shouldn't one's children and grandchildren be one's greatest honor and pride?

[BigBallinStalin]

Here's what you said:
" I'm not interested in banks making more money off the investment opportunities afforded to them because of savings from rich people. That money needs to be distributed more in the form of actual spending, which is more beneficial to people other than the wealthy."

You just took a position on spending. You're dictating more than just tax policy (estate tax), so if your position is more than just tax policy (estate tax), then obviously I'll need to expand beyond the estate tax. If you mention spending, then obviously I need to mention more than just spending--because it cannot be just about spending. You can't only spend wealth in order to create wealth. You won't get prosperity if you neglect the saving. Nevertheless, you apparently refuse to consider the role of saving and the implications of your stance. You outright reject any talk about savings.

This conversation requires an understanding of the fundamentals of spending/consumption and investing/saving. If you talk just about spending while declaring that you don't wish to talk about saving, then that's totally ignorant.

Fair enough. I have no intention to get into a larger discussion about the proper role of spending versus saving in this thread. I am merely interested in here about how wealth should be distributed once it is no longer needed by the individual who accumulated it.

But this is the crux of the issue. If one is economically uninformed and relies on some kind of Rawlsian position, then they cannot determine the soundness of that Rawlsian position--only its validity. I make this critique--not from malice--but to highlight that when you talk about economics yet are not informed about economics, then we should recognize this and be concerned about this problem. It would be like me getting absolutely hammered and then dictating the 'proper' science which all Astrophysicists should follow (that would be crazy talk).

One lesson from Economics for me is about being humble in the task of central planning. Some socialist, social scientists recognize this as well (James C. Scott, Gabriel Kolko), but many do not (Marx and usually philosophers and political 'scientists').

So, we got the proper setting for your "dead people don't need their money" position. I'll gladly get into it, and we can keep it short. I'm going to make a few quick responses to the other parts, and then we can sit back, hit the Reset button, and have you clearly state your position.

(3) It's called "exchange." If no theft was committed, then there's no obligation to "give back" since one has already given back--through exchange.

Well, I disagree. I believe a debt can be owed without a theft being committed. What now?

Then you imagined the debt into existence on the basis of no contract. In order to have an obligation to others in regard to borrowing and lending, then one must have some contract which delineates the duties of each party. Since there's no contract (or an imaginary, nonexistent one), then your reasoning is faulty.
(Then you'll bring this to the normative).

I believe there does exist a contract. Social contract theory is alive and well among philosophers thanks to John Rawls. Perhaps ironically, I don't share Rawls' conception of moral justice. I agree that by its nature a society is a contract among its various members, to avoid certain acts in return for collective protection. I disagree that this says anything about ethics at the fundamental level; that is, one is not making a moral statement that said certain acts are inherently wrong, but rather they are just things the society has agreed not to do. Those things may be equivalent to the things we agree are ethically wrong, or they may not be.

This contract is not signed by a pen with anyone, and yet is implicitly agreed to by your continued existence as a member of the nation and participation in its structures.

Okay, I'ma get Socratic about your social contract theory, but first I want you to tie in your social contract theory specifically with your main position, which I presume is this:

"I am merely interested in here about how wealth should be distributed once it is no longer needed by the individual who accumulated it."

"At that point, saving your money is no longer useful to you because you won't be around to see the returns on your investment."

Let's assume your statement is true. If it wasn't useful, then why would anyone save any money to give away after they die? (Because it's useful to them during the time which they save so that they can give to others in the future). It doesn't matter if they die because that wouldn't negate the usefulness of that wealth to them--and to others to whom they've voluntarily transferred their wealth. You have to consider the actions and plans of individuals throughout the entire time of their lives--not just one fine point.

If they feel this way, that is precisely what I would like. It is a good thing if the extremely wealthy earn a lot of money with the intent of saving it until shortly before they die, and then sharing it with others. I strongly encourage such behavior; it is the highest of morally honorable behavior. See the article I linked.

Right, but the wealth in the form of savings can be transferred to others as savings, and there's nothing wrong with that. Savings in some forms can be an investment. An investment can be a house, a car, or any productive capital from which you earn more profit--currently or in the future. E.g. your education is an investment. It is a form of savings from which you can later garner greater profits.

Spending, i.e. consumption, would be equivalent to not investing in your education and instead blowing all the money on consumption goods (e.g. food, video games, clothes, even a car--arguably if it is not garnering more profit than a cheaper car).

RE: the article, I agree. The division of labor allows for individuals to pursue opportunities from which they attain a comparative advantage, which allows for greater productivity. With greater productivity, we can create more goods with less inputs (or have a surplus), so that through voluntary exchange of these goods , people mutually benefit ex-ante, thus this positive-sum game is the basis of creating wealth. In other words, I'll do my thing with econ., Y does her thing with finance, and Z does his thing with charity. However, I disagree if anyone is coerced by the government into donating.

(Now, if we take that article seriously, then we should be upset that the government imposes a marginal tax rate of about >48% on those earning about >$130,000 per year. All of that money could've have been better spent through the market of charitable organizations. You may disagree, but if we apply the reasoning consistently, then we also level some criticism at the state. Anyway, that's a bit off-topic).

[Frigidus]

If they feel this way, that is precisely what I would like. It is a good thing if the extremely wealthy earn a lot of money with the intent of saving it until shortly before they die, and then sharing it with others. I strongly encourage such behavior; it is the highest of morally honorable behavior. See the article I linked.

So it's morally honorable to share that money with "others" or hand it over to the government, but it's not morally honorable to share that money with one's progeny? Why are those individuals excluded from what's honorable? Shouldn't one's children and grandchildren be one's greatest honor and pride?

There's nothing wrong with leaving a certain amount of money to your children, but at a certain point it becomes excessive. Let's say someone has one billion dollars. It is such a great amount of money that you would have to be going out of your way to get rid of it in order to lose it. It ceases to become potential things you could have and instead becomes a hoard, existing only for the sake of existing. There is simply no reason to give the entirety of this to your family. The sheer amount of good you are choosing not to do with that money is borderline immoral.