This coming week, Senate Republicans are putting up for a vote repeal of the estate tax (which Republicans have renamed the “death” tax in order to fool Americans into thinking most have to pay it when they die). Right now, the tax only hits families with more than $4 million to give to their heirs. That’s the richest one-half of one percent of American families — only about 1,200 families altogether. Families can leave their children up to $4 million without any tax at all. But because this small group of families has so large a fortune, repeal would cost the U.S. Treasury $1 trillion in its first ten years. That’s about equivalent to what’s needed to save Social Security over the next 75 years. Put another way, the yearly loss to the Treasury is almost exactly equal to the amount the U.S. spends each year on homeland security. If the super-wealthy won’t pay, the middle class will have to pay more taxes to make up the difference. Or the national debt will expand, and we’ll all be paying more interest on the resulting borrowing (mostly from wealthy Americans, along with China and Japan).
So why aren’t Americans making a bigger fuss? Because they’ve been sold a huge load of lard about this. The PR campaign for repeal has been financed by 18 super-rich families, with a combined total wealth of $185 billion. If they get the tax repealed, they’ll save over $70 billion.
Every Republican president who has waged war during his presidency, from Abe Lincoln on down, has supported the estate tax as a way to finance the war equitably by having the rich pay their fair share. George W. Bush is the first to want to repeal it. To make matters even more absurd, the richest American families, with personal fortunes of $2 million or more, already own a third of all the wealth in the nation. That’s a record high, since records have been kept.
Senator Max Baucus (D-Montana) is about to offer an amendment to repeal up to $7 million. That’s still a travesty.
