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>>You said people with lots of money should have done something to earn it.
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>>You misunderstood me - why not have the government hold $XXX million in trust, then when she has "done something to earn it", then she gets it back?
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>>Maybe you mean she should earn $XXX million on her own, then the government will give back $XXX million? Or maybe she only earns $XX or $X millions, the government could match her earnings up to a limit of $XXX million? Not a bad starting point for discussion...
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>>It's very much worth pointing out that, according to your criterion, the government needs to show that it's worthy of confiscating and making use of $XXX million. That's after making the very debatable assumption it has any right to confiscate any part of an estate built legally from earnings already taxed.
>
>Good points, Al.
>Especially about the government needing to show that it will make intelligent use of tax dollars. It certainly hasn't done a good job of that during the past 50-odd years. Some kind of trust fund would be a good idea except that whenever they'd had them - e.g. social security- they've raided them to fund the senseless invasions of other countries.
>That's another topic.
>
>Here are some points to ponder while we set about making our own billions this week:
>
>Point 1:
>As far as Annie is concerned, I've suggested that the first $2 million or so be exempt from any tax and that the balance be taxed at 90%.
>Let's say that Daddy W had an estate of $1 billion.
>That would give Annie and Sandy a head start of over $100 million and put them in the top 5% at least.
>I'm concerned about excess wealth, not reasonable inheritance.

How did you arrive at that 90% tax rate?

Unless Annie has $900M lying around, after Daddy W dies she's going to have to liquidate his holdings to pay the tax bill. In a forced tax sale she may not get the 90 cents on the dollar required to pay the tax, so she would end up with nothing.

Any amount less than 100 cents on the dollar is value destroyed by the forced sale. That will have follow-on effects in plant closures, loss of jobs etc. etc.

Some say private property is the foundation of freedom. So, under your system, the wealthier you are, the less freedom you have.

I'm a big believer in having a balance between authority and responsibility. Some would argue that having lots of money yields power and authority. I'd argue that would call for it to be used responsibly. "With great power, comes great responsibility".

I suspect your beef is really with wealthy people or institutions who, in your opinion, use their wealth irresponsibly. So, you would pre-emptively confiscate large estates, rather than incentivize them to "do the right thing(s)".

>Point 2:
>Sometimes it's useful to turn ideas upside down and look at them another way.
>Let's suppose that instead of Daddy W, Annie had been adopted by Bernie Madoff who has been sentenced to several lifetimes in prison and owes billions and billions.
>Would anyone suggest that Annie and her children and grandchildren be made to work the rest of their lives to pay off his debts, just because she had been adopted?
>Worse yet, would anyone suggest that Annie be made to serve the remaining time of his term when he dies?
>Of course those are absurd ideas, because she didn't EARN that kind of treatment.

Assuming Annie has done no wrong, she has no liabilities for Bernie's actions. She shares that status with you. Suggesting that Annie be liable for, and try to pay off Madoff's debts, is the same as saying you should do it. Relatedness has nothing to do with it.