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GOP Makes Powerful Case for Huge Inheritance Tax Increases

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I never thought I would hear Republicans arguing the case so powerfully that inheritances should be very highly taxed. Indeed, with a Congress that pays itself $174,000 per person per year for barely working, and achieving nothing but sticking it to the American people, it is surprising to hear them wax so eloquently about the value of hard work to society and how much laziness costs the economy.

Now the Republicans are raising their hands in horror about the alleged negative impact on society if people do not have strong incentives to work because they lose their Affordable Care Act subsidies above a certain income level. The right-wing claims that we lose the sweat from their brows and the positive contributions they might have made. It is perhaps worth observing that if middle class families require at least two jobs to keep their heads above water, they will have neither the time nor the energy to fight for themselves politically.

But, here is the simpler truth: except in a full employment economy, the only consequence of the Affordable Care Act subsidies is transferring the 2.5 million jobs (actually, full-time equivalents or FTEs, but let us not get overly technical) from one group to another. Only in a full employment economy, by definition, are there no unemployed to take those jobs. But, that is what is called a very "high quality" problem, an issue we can address, and probably is not so important, when we get there.

But, what about others in our system who have no financial incentive to work in the first place?

Consider, for example, the children of the incredibly wealthy. It has never been clear why, in a meritocracy, they deserve to own such enormous wealth when their parents pass anyhow. True, some provide fodder for the tabloids, and thus make waiting in the check-out lines at supermarkets entertaining. Without Paris Hilton, where would we be?

Let us be clear. There are many wealthy heirs that work and work hard. But, it is not because their financial need is the incentive.

If Republicans are so worried about some jobs (2.5 million out of a U.S. labor market of 135 million) getting transferred -- with each side being completely voluntary, both the person who relinquishes his job or hours and the unemployed or underemployed worker taking it -- because of reduced incentives (mostly to keep health care in the pre-Affordable Care Act world), they must be positively apoplectic about the heirs to great fortunes who have no financial need to work at all.

The right-wing will argue that the difference is that workers are receiving government subsidies whereas the heirs get subsidies from dear old dad. But, the workers have worked to get to the income level where the subsidies enable them to reduce their hours -- the wealthy heirs have not.

As Republicans are so agitated about maintaining incentives (for others) to work their fingers to the bone, should we not increase the inheritance tax to preserve the financial incentives for wealthy heirs to work?