Death Tax Woes – A Moral Argument

by on April 14th, 2005

Listening to the debate over the future of the estate/death tax highlights a striking deficiency in the conservative game plan. The left blames their recent election-losing streak on their inability to communicate with the public on a moral level. In the case of the estate tax, the proponents of the tax are the only side presenting the argument in a context of morality, and they will win this debate unless those arguments are countered on the same level.

Conservative members of congress argue, in some cases eloquently, the utilitarian arguments for eliminating the estate tax. An estate tax is a tax on capital savings and encourages consumption at the expense of savings, and it is well known that Americans consume too much and save too little. Opponents of the tax properly argue that eliminating the estate tax can help alleviate this problem. Perhaps a conservative will briefly touch upon the occasional family farm that is destroyed in the wake of the burdensome estate tax liabilities. Another might describe a family that is forced to purchase an ungodly amount of life insurance just to protect the family assets upon the passing of their loved one.

No matter how many stories of carnage estate tax opponents share, without a moral backing, the argument is bankrupt. Conservatives are either unable to, or are still sadly unaware, that they must argue this issue at its most essential level. They may argue economics until they are blue in the face, but it will not change proponents’ minds. The leftists who have championed the estate tax for decades have all but given up arguing for the tax in terms of economics – of course, their concern is the health of the State coffers, regardless of what it does to the economy.

A common line in favor of maintaining the tax is that it only affects a minute percentage of the population and eliminating it would in effect hurt nearly everyone else. In light of reasoned economic theory, much of which estate tax opponents are touting, this is hardly a sound argument, though it unfortunately trumps even the greatest economics because it is expressed as a moral argument steeped in altruistic language.

Without a moral argument to counter such dislogic, the left will win every time. Even if the estate tax is ultimately eliminated, the left will ensure that it is replaced with new capital gains taxes that usurp as much, if not more, of a dead person’s wealth than under current tax laws. It will be quietly swept under the rug as a victory for Republicans, but the State will win in the end – the statists are holding quite the poker hand.

When I was a child, I schemed up the ultimate tax – a 95% estate tax placed upon only the wealthiest 1% of the population. I calculated that getting a hold of the money held by the wealthiest few would allow us to eliminate most other taxes for the other 99% of the population. How great, I argued, would that be if most of us paid no taxes and still were provided with all those great government services? Though I couched my argument in utilitarian terms, my argument was ultimately a moral one, believing it proper to sacrifice the few for the benefit of the rest. Never mind that my young socialist head had no concept of opportunity cost or what the proper conditions for capital formation are in the first place. No one ever asked me, “BY WHAT RIGHT” do you have to take their money and redistribute it to yourself and others? The only answer I would have been able to muster is that “the morality” of altruism trumps anything else.

Until opponents of the estate tax unequivocally argue the inalienable right of the individual to utilize or dispose of one’s own property as they, and not the State, see fit, they will lose this most important fight. This is ultimately a battle between the moralities of rational self-interest and altruism. Until opponents of the tax are able to argue on the same plane as the left, they cannot win. If most conservatives share the notion with the left – that altruism is the highest moral achievement for mankind, it not only explains the impotency of their current arguments, but also ensures the left the winner of this fight, and many more.

Michael Hussey