Private property rights have been under assault from the left for years ... eminent domain, wealth redistribution through forced taxation, estate tax, capital gains tax.
Excellent article pointing out what's real about humans, that we like to enjoy what we've worked for, accumulated, paid taxes on while doing so .... and should have the right to dispose of it as we see fit WITHOUT further social engineering taxation.
Emphasis added mine.
"While no political thinker worth his salt underestimates the importance of private property, Machiavelli cut to the heart of the matter most succinctly. A prince, he wrote, "must not touch the property of others, because men sooner forget the killing of a father than the loss of their patrimony."
James Madison's analysis, while a bit more high-minded, amounts to nearly the same thing. He asserted in Federalist 10 that "The diversity in the faculties of men, from which the rights of property originate" will always lead to divergent interests within society. Men will, he held, invariably exhibit different abilities and inclinations. Some will be smarter, more industrious, even luckier than others, and in a condition of general equality these differences will lead inexorably to economic inequality. Government must be up to the task of protecting the gains of the few against the many if need be. Indeed, he said, "The protection of these faculties is the first object of government."
And few have been more protected than Warren Buffett. He is without question the most successful investor of the second half of the 20th century, and he is poised to become one of the greatest philanthropists of all time with his pledge of more than $37 billion to various charities, most notably the Bill and Melinda Gates Foundation.
While the gift makes Buffett look like the capitalist with a heart of gold, the timing of his announcement might have more to do with recent legislative machinations over the estate tax, not to mention his apparent faith in social engineering. The House, after all, sent an estate tax reduction bill to the Senate on Friday. By Monday Buffett was monopolizing the air waves with his divestiture. The terms of the legislative debate, if there was even to be a debate in the Senate, have been indelibly redefined by the so-called "Oracle of Omaha."
Coincidence? Not likely.
The estate tax, or death tax as it is more commonly known, was targeted for extinction in the first round of President Bush's tax cuts in 2001 and has long been an object of Republican scorn. Continued resistance in the Senate has made repeal impossible, but an impending election cycle has put the issue back into play. Senate Majority Leader Bill Frist asked for and received a watered-down bill, a bill which passed the House in a 269-156 vote and has a fighting chance at getting the 60 votes needed to conduct business in the Senate. If the bill becomes law, estates worth up to $5 million for individuals and $10 million for couples would escape taxation entirely beginning in 2010. After the exemptions, estates worth up to $25 million would be subject to rates equal to those on capital gains, rates which are now 15% but are scheduled to increase to 20% in 2011. The remainder of estates which exceed the $25 million limit would be taxed at 30% until the capital gains rate hike in 2011, at which point they would be taxed at 40%. Some estimates hold that the number of estates subject to the tax will decrease from 30,000, which was the number for 2004, the last year for which data is available, to only 5,100 when the law takes full effect in 2011.
In the press conference announcing his gift to the Gates Foundation, Buffett addressed the tax explicitly. "It's a very equitable tax," he said, urging Congress to maintain the status quo. "It's in keeping with the idea of equality of opportunity in this country, not giving incredible head starts to certain people who were very selective about the womb from which they emerged."
Like all good nanny-state proponents, Buffett would use tax policy as a blunt-force tool to achieve his social preferences while simultaneously closing the door on dissenting views. The real problem, after all, isn't that Buffett is disposing of his assets according to his own wishes, it is that he would deny others the same level of self-determination given half a chance.
When asked how his children took the news of his impending liquidation, Buffett said, "My kids were elated when I told them. They knew my views on inherited wealth and shared them. I believe in equality of opportunity...They should not inherit my position in society..." Warren Buffett's position in society is not up for grabs though, and he knows as much. The only thing that his children could have inherited was the accumulated result of a lifetime of impressive work. And why shouldn't this be an option? How is wealth given to a foundation qualitatively different from wealth given to sons and daughters? In a 2001 New York Times interview Buffett offered his answer, saying, "We have come closer to a true meritocracy than anywhere else around the world. You have mobility so people with talents can be put to the best use. Without the estate tax, you in effect will have an aristocracy of wealth, which means you pass down the ability to command the resources of the nation based on heredity rather than merit."
But the "resources of the nation" are not at issue; and this was no slip of the tongue. Private resources are at issue, and they have been taxed already -- multiple times in many cases. Also on display is his raw paternalism. Someone might inform Mr. Buffett that "people with talents" are not "put to the best use" in a free society. They choose their own paths, just as he has always done. And in a free society the purpose of taxes is to raise revenue, not remake society in the image of an enlightened investor.
Buffett often claims that he believes in equality of opportunity. Without the ability to enjoy the spoils of success, though, equality of opportunity is a meaningless term. The means by which one can enjoy the fruits of his own labors is a decidedly personal matter, and the "pursuit of happiness," to borrow a phrase, is invariably a self-defined endeavor. Neither Warren Buffett nor the United States Congress can change this by fiat, no matter how well-intentioned.
Warren Buffett can dispose of his own property any way that he wants, but nothing gives him the right to interfere with others as they do the same. He should be lauded for his gift, and if others choose to follow his lead, that is their prerogative. If they choose to follow their own path, he should respectfully withhold comment.
Madison would have said as much. He also would have advised the Senate to ignore Buffett's grandstanding and follow the House's lead. In a perfect world the death tax would be eliminated entirely and immediately, but in a perfect world 41 Senators, aided, abetted, and goaded by Warren Buffett would not have the ability to stifle the popular will. Passing the compromise tax cut now will make eliminating the tax easier later, and it will strike a blow against would-be social engineers, both public and private. It's hard to say which of these two eventualities would have a more salutary effect over the long term.
James R. Harrigan is an Assistant Professor of Political Science at Saint Vincent College in Latrobe, Pennsylvania.
http://www.tcsdaily.com/article.aspx?id=062806E
March 2024 February 2024 January 2024 December 2023 November 2023 October 2023 September 2023 August 2023 July 2023 June 2023 May 2023 April 2023 March 2023 February 2023 January 2023 December 2022 November 2022 October 2022 September 2022 August 2022 July 2022 June 2022 May 2022 April 2022 March 2022 February 2022 January 2022 December 2021 November 2021 October 2021 September 2021 August 2021 July 2021 June 2021 May 2021 April 2021 March 2021 February 2021 January 2021 December 2020 November 2020 October 2020 September 2020 August 2020 July 2020 June 2020 May 2020 April 2020 March 2020 February 2020 January 2020 December 2019 November 2019 October 2019 September 2019 August 2019 July 2019 June 2019 May 2019 April 2019 March 2019 February 2019 January 2019 December 2018 November 2018 October 2018 September 2018 August 2018 July 2018 June 2018 May 2018 April 2018 March 2018 February 2018 January 2018 December 2017 November 2017 October 2017 September 2017 August 2017 July 2017 June 2017 May 2017 April 2017 March 2017 February 2017 January 2017 December 2016 November 2016 January 2013 October 2011 September 2011 August 2011 July 2011 June 2011 May 2011 March 2011 January 2011 December 2010 October 2010 September 2010 August 2010 July 2010 June 2010 May 2010 April 2010 March 2010 February 2010 January 2010 December 2009 November 2009 October 2009 September 2009 August 2009 July 2009 June 2009 May 2009 April 2009 March 2009 February 2009 January 2009 December 2008 November 2008 October 2008 September 2008 August 2008 July 2008 June 2008 May 2008 April 2008 March 2008 February 2008 January 2008 December 2007 November 2007 October 2007 April 2007 March 2007 February 2007 January 2007 December 2006 November 2006 October 2006 September 2006 August 2006 July 2006 June 2006 May 2006 April 2006 March 2006 February 2006 January 2006 December 2005 November 2005 October 2005 September 2005 August 2005 July 2005 June 2005 March 2005 November 2004 October 2004