RE: Alice's inheritnace tax proposals (a problem)

["Bernie Doeser" <bernie@doeser.org>]

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There are a multitude of examples of people acquiring wealth unfairly - if
you want some really humungous examples read "House of Bush, House of Saud"
by Craig Unger. Alternatively, just read the newspapers ......

So premise 1 "Great wealth is usually acquired by unfair means"

Next, what does wealth get you? Apart from a wardrobe full of shoes, a big
yacht in Nice and a table at The Ivy, it gets you POWER.

So premise 2 "Great wealth bestows great power"

What do the powerful do with their power? Well, in general they use their
power to maintain their wealth and power, and to do this they manipulate
society and business in order to achieve their ends.

So premise 3 "The powerful use their power to maintain their wealth and
power"

Next we come to the consequences of concentrating power and wealth - with
finite resources for every rich person there are thousands of poor people.

So premise 4 "the concentration of wealth results in mass poverty"

I think we need a conclusion ....

Conclusion "In most societies there will be a tendency for wealth to be
concentrated in the hands of the few, and for the majority to live in
poverty."

Discussion - societies use legislation and taxation to exert some
constraints on the rich as without such constraints society will drift
towards a state of affairs that only a very small minority are satisfied
with. The reaction to such situations (e.g. pre-Castro Cuba, and Tsarist
Russia) has often been revolution, so there is even a case for the wealthy
to seek distribution of wealth. Progressive taxation (higher taxes for the
rich) is seen as an effective means of wealth distribution, and IHT, which
only affects the wealthy is a good example of progressive taxation.

I can see very few advantages for society in allowing wealth and power to be
held in the hands of the few, particularly when, as in the case of
inheritance, this power is transferred to people by dint of an accident of
birth and not through skill, talent or qualities. Therefore my vote goes to
100% IHT to break the cycle. Of course I am sure that clever accountants
will seek to find ways around it, though Gordon Brown has shown that clever
governments can frustrate tax avoiders too.

I leave you with a quote
"Property left to a child may soon be lost; but the inheritance of virtue--a
good name an unblemished reputation--will abide forever. If those who are
toiling for wealth to leave their children, would but take half the pains to
secure for them virtuous habits, how much more serviceable would they be.
The largest property may be wrested from a child, but virtue will stand by
him to the last. " William Graham Sumner, US economist & sociologist (1840 -
1910)

Bernie Doeser
Sandiway, Cheshire, UK.

-----Original Message-----
From: owner-bups-dis@purplepancake.com
[mailto:owner-bups-dis@purplepancake.com]On Behalf Of Robert Charleston
Sent: 11 September 2005 02:55
To: bups-dis@bups.org
Subject: Re: Alice's inheritnace tax proposals (a problem)

To reply to this message or start a new topic please email:
BUPS-DIS@bups.org


Hi Alice,

If I were defending a position paper on inheritance tax (see 'netiquette'
spiel) I'd want to point out that:

1. This isn't about dooming society to failure. Few single policy
    decisions are. It's not that society is doomed to failure if
    inheritance tax prevents hereditary accumulation of wealth, it's that
    if it does prevent this it loses a resource that can be difficult to
    replace.

2. Very few rich kids have ever bought an art gallery. But the central
    cladding to the British Museum Reading Room lists the private, wealthy
    donors who paid for it, the Ashmolean and Bodleian in Oxford, the
    Carnegie Hall, the Tates Modern and Britain and so on all bear the
    names of the private benefactors who paid for them.

3. Yes people can earn a lot in one lifetime. Branson is a bad example,
    because he is only worth a fraction of the amount people usually think
    he is. Virgin only continues trading through extensive cross-subsidy
    and tax offshoring. He's not rich in the way that the remaining landed
    families are, and even they are not anywhere near as rich as they used
    to be. I can look up some comparative statistics if you'd like, but
    before the legal reforms, we were talking much bigger money. Think
    Soros or Gates.

4. Yes, I am exactly suggesting that rich kids can fund political parties.
    This is true of Labour, Conservatives, Liberals and Monster Raving
    Loonies. We don't - unless I've missed something - have state funding
    of political parties in this country. Only Labour had substantial
    non-hereditary funding from the unions. Since this has now almost all
    gone, they are dependent as anyone else on private individual donors.
    It comes from businessmen and big firms rather than landed gentry. Is
    that better, worse, or the same?

5. Finally, I'm not aware that there's ever been a democratic principle
    that money shouldn't buy too much power, has there? I just thought it
    was 'everyone gets a vote'. Since people go into government to get rich
    these days, shouldn't there be some wealth outside of that clique to
    oppose them when they (inevitably) go bad?

And yes, I'm trying to give a few shibboleths a good kicking. You have to,
or they're just prejudices...

Rab.


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