Date: 2024-08-16 Page is: DBtxt003.php txt00026058
WEALTH
ITS USE AND ABUSE
Can Billionaires and Democracy Coexist? ... Wealth accumulation through inheritance,
externalities, and Wall Street speculation tends to be used to thwart democracy
ITS USE AND ABUSE
Can Billionaires and Democracy Coexist? ... Wealth accumulation through inheritance,
externalities, and Wall Street speculation tends to be used to thwart democracy
Original article: https://www.laprogressive.com/economic-equality/billionaires-democracy-cannot-coexist
Peter Burgess COMMENTARY
Peter Burgess
Wealth accumulation through inheritance, externalities, and Wall Street speculation tends to be used to thwart democracy
Written by GEORGE POLISNER
DEC 11, 2023
Iam not anti-wealth. I am, however, a strong proponent of democracy in the United States and around the world in its various, flawed forms.
A recent article caught my eye in The Guardian, from Wealth Correspondent, Rupert Neate. The article was titled “Next generation of billionaires collect more wealth from inheritance than work, says UBS”.
First of all, I wasn’t aware that The Guardian had a “Wealth Correspondent”. Second, it was noted that British Chancellor Jeremy Hunt was under pressure from some in his party to reduce the UK’s inheritance tax, currently a 40% tax on estates worth more than £325,000 (with certain exemptions and exclusions). Mr. Hunt is a member of the Conservative Party, also known as the Tories.
By comparison, in the US, estate taxes are also currently 40%. Good news, your heirs can exempt almost the first $13 million dollars you pass along to them from taxation. Estate taxes were assessed at 55% in 1997 with a $600,000 exemption. In 2010 the tax was temporarily suspended. So if you died in 2010, that’s the bad news, and you are probably not reading this. The good news is that your heirs, little Tiffany and/or little baby Reginald paid zero.
Wealth transfers through inheritance must be taxed if there is to be any thought of a democratic, just, and equitable future.
Conservatives in the UK, and the GOP in the US continually seek to eliminate or minimize estate taxes. They argue that the accumulated wealth has already been taxed when it was earned through employment, or as capital gains and investment income (if not from employment earnings). In the US the GOP has attempted to rebrand estate taxes (which conjures images of a large, posh mansion on seventy acres, a heliport, a Bentley or two, equestrian riding lessons for Tiff, polo lessons for little Reg, and a phone in which a few Supreme Court Justices, Senators, and other elected officials are available 24x7 on speed dial). For more on conjuring images (or frames), Dr. George Lakoff’s “Don’t Think of an Elephant” is mandatory reading. So the GOP now calls estate taxes -a death tax, in order to get their underinformed Fox ‘News’ viewing base whipped up into a frenzy thinking that their 1997 Buick and Pepsi bottle cap collection is going to create a massive tax liability for Biff.
The reality is well over 99% of the global population will not have any estate taxes assessed in the US or the UK. This is not information the GOP in the US, or the Tories in the UK like to share, because it might create the impression that they only care about the obscenely wealthy, which is true, but they don’t want to admit they only have the best interests of less than 1% of voters in mind.
Wealth Represents Political Power
There is something far more sinister about attempts to reduce or eliminate estate taxes. And this goes to the heart of my concern. Wealth represents political power. I recognize that this statement might be deemed highly controversial. Let me repeat it, “Wealth represents political power.” In these post-“Citizens United” days in the US, where the corrupt Supreme Court elevated money to be the equivalent of speech, the concept of one person, one vote -an important idea behind any meaningful form of democracy is gravely weakened. When an issue is before the US Supreme Court that might benefit the ultrawealthy like Harlan Crow or Paul Singer, after they bestowed numerous luxurious gifts and travel to ‘Justice’ Alito, or ‘Justice’ Thomas, democracy erodes and ‘justice’ is only for those who can afford it.
Are your elected officials likely to take a meeting with you, or someone who just wrote a check for a million dollars to their campaign, or to a PAC supporting their campaign? By transferring wealth to the next generation, without a significant tax on the inheritance, society loses an opportunity to invest in healthcare, climate action, education, infrastructure -all benefitting current and future generations. Without taxing the transfer, society is handing significant political power to a generation that is unlikely to understand the anxiety and challenges of living paycheck to paycheck while working one, two, or more jobs to make ends meet.
They will never understand going to work instead of going to a medical appointment, because if take time off of work you will be short on rent. They will have no understanding of what it means to figure out which of the life saving drugs you can afford this month and which prescription you hope to get filled when you get your next paycheck.
Wealth transfers through inheritance must be taxed if there is to be any thought of a democratic, just, and equitable future.
Iam not anti-wealth -when it is earned through effort or by putting capital at risk by building a company -or even an industry. My concern is with wealth transfers and wealth accumulation through inheritance, externalities, and Wall Street speculation -all of which should be boldly taxed and used to strengthen democracy and opportunity for an entire society, not just for Tiffany and Reginald.
The opinions expressed here are solely the author's and do not reflect the opinions or beliefs of the LA Progressive.
BY GEORGE POLISNER ... George A. Polisner has spent the last several years of his career addressing highly-complex conceptual technological and economic challenges for government, large enterprise and society. He remains active and engaged in participatory democracy, participatory budgeting, communication and strategy. He also writes about corporate social behavior and externalities. His work and innovation has been noted at Oracle, Dell, HP and the Legislative Counsel for the State of California.
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