Libertarianism and Inheritance

[Cain]

One of the arguments against libertarianism that I've been experimenting with lately questions its commitment to meritocracy. The following first appeared (in embryonic form) in an e-mail to a friend explaining one problem. Instead of duplicating past efforts, repeating myself over and over again, I've finally decided to take an extra minute to write a pithy argument, save it, and perhaps eventually publish it on Mike Huben's site. I'll vet part of it here.

Though libertarians tend to disagree among themselves over the most just form of taxation (or the least unjust, if any), they generally stand together, in my experience, against the estate tax. "How dare the government seize a person's property without their consent."

Warren Buffet, the billionaire investor and second richest man in the world, denounced the repeal of the estate tax, saying it is "the equivalent in economic terms of choosing our Olympic
team by picking the eldest sons of the gold-medal winners in the 2000 Olympics. We would regard that as absolute folly in terms of athletic competition. We [the U.S.] 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."

I do not see how a libertarian can substantively challenge the analogy or the observation. She might charge the comparison is drastically overstated, and wealth bestows only minor advantages. But notice here we are merely disagreeing over the empirical effects of privilege, a spectrum of opinion ranging from decisive to negligible. Suppose, as most people do, that wealth does in fact confer significant advantages. Would a libertarian then agree an estate tax is justified in the interest of fostering a society more liable to reward talent and ability? The answer, presumably, is no.

Instead I think libertarians appeal to an alternative set of values, one that claims (nearly) absolute property rights take precedence over a system that is more inclined to compensate an individual's natural capabilities.

Their counter-argument, then, boils down to "so what?" Property rights trump all, even meritocracy. Big deal.

Well, the problem -- and this cuts to the heart of liberty -- is that they are in effect arguing for a social-economic system that allows a person's place in life to be determined by uncontrollable circumstances rather than free choices -- the anti-thesis of libertarianism's stated ideals.

I see two more possible objections, the stronger of them an argument for socialism. On this view liberalism, though an improvement, does not go far enough. Milton Friedman makes a similar argument (as reductio ad abusrudm) in _Capitalism and Freedom_.

 

[michaellee]

originally posted by Cain

Though libertarians tend to disagree among themselves over the most just form of taxation (or the least unjust, if any), they generally stand together, in my experience, against the estate tax.

Well, the problem -- and this cuts to the heart of liberty -- is that they are in effect arguing for a social-economic system that allows a person's place in life to be determined by uncontrollable circumstances rather than free choices -- the anti-thesis of libertarianism's stated ideals.

One libertarian definition for Liberty is "to be free from unjust or undue restrictions or controls". The argument quoted states that the lack of an estate tax determines one's place in life- that this situation is an "uncontrollable circumstance" and not a free choice.

If the lack of an estate tax creates an "uncontrollable circumstance", then how can one argue to attempt to control something defined as uncontrollable, especially at the hands of the government?

And is not an estate tax unjust in the minds of libertarians, as stated in the article?

So how is allowing the government to apply an unjust control cutting into the heart of liberty?

To the contrary, an estate tax is in complete contradiction to the definition of what libertarians believe liberty to be.

 

[Cain]

One libertarian definition for Liberty is "to be free from unjust or undue restrictions or controls".

This is a loaded definition; a truism. Everyone believes people ought to be free from unjust restrictions and controls. The problem is identifying what we consider "unjust" (which means providing reasons).

The argument quoted states that the lack of an estate tax determines one's place in life- that this situation is an "uncontrollable circumstance" and not a free choice.

If the lack of an estate tax creates an "uncontrollable circumstance", then how can one argue to attempt to control something defined as uncontrollable, especially at the hands of the government?

I'm not sure I understand the objection, but the argument could have been more clear. Here, this liberal argument (or at least what is today considered liberal) seeks to equalize opportunity; level the playing field. Revenues from the estate tax would be redistributed in order to provide universal access to socially essential goods and services (think quality education).

"Uncontrollable circumstances" refers to the perspecive of a particular individual rather than society.

Take for instance two high school seniors that are the same gender, the same ethnicity, and grew up in the same town their entire lives. They make nearly identical grades, participate in the same extra-curricular activities, and their parents work together at the same law firm. Both want to major in political science and they apply to the same colleges. A certain prestigious ivy league school admits one of them on the grounds that his father is an alumni.

Is that fair? How can a person help it if their father did not attend that university? In this case a person inherited a name. If we believe extreme wealth bestows significant advantages, then we ought to rectify those inequalities as much as we can. Inheriting one billion dollars from parents requires neither skill nor sacrifice.

Allow me to clarify a central point. I am only arguing that an estate tax is justified. Where you want to draw the line, exempt the first ten million dollars or the first one-hundred million, is a question of policy, not philosophy. Libertarians argue (most of them anyway) that a line should not be drawn at all. I chose this form of taxation because inheritance requires no special efforts or sacrifice (except for those sycophants who feign friendship for financial gain).

And is not an estate tax unjust in the minds of libertarians, as stated in the article?

Yes, but I'm attempting to appeal to an alternative set of values, explicitly meritocracy and free choice (one could also tack on efficency and the greatest good for the greatest number).

So how is allowing the government to apply an unjust control cutting into the heart of liberty?

To the contrary, an estate tax is in complete contradiction to the definition of what libertarians believe liberty to be.

Again, those are loaded terms. Do you believe the government should kill an innocent person when it's necessary? Of course you do. I do. Everyone does. It's a question of when it is necessary", or in this case, what is unjust.

 

[corplinx]

Well, if you take the scholarly approach, it isn't so much an issue of libertarianism as it is american fundmentalism. If you read Locke's second treatise of governement you find that being able to pass on your estate unhindered was pretty important.

I think the problem with your arguements comes from the "so what" factor.

leftist: "I dont think rich people should pass on all their wealth thereby giving their children an unfair advantage"

libertarian or constitutional scholar: "So what?"

leftist: "Doesnt said unfair advantage go against my interpretation of you views?"

libertarian or constitutional scholar or anyone with half a fricken brain: "No. I wasn't born 6'6" and will never be a pro-ball player. Is that fair? Part of libertarianism is recognizing the difference between fairness which is subjective and justice which is objective."

 

[Frank Newgent]

libertarian or constitutional scholar or anyone with half a fricken brain: "No. I wasn't born 6'6" and will never be a pro-ball player. Is that fair? Part of libertarianism is recognizing the difference between fairness which is subjective and justice which is objective."

Rejection of inherited privilege seems sufficiently objective to me.

Wasn't America once thought of as something counter to the European hereditary aristocracy?

Funny that these days (in the US) a rebellion against the "establishment" winds up abolishing the tax on inherited estates.

 

[Cain]

Well, if you take the scholarly approach, it isn't so much an issue of libertarianism as it is american fundmentalism. If you read Locke's second treatise of governement you find that being able to pass on your estate unhindered was pretty important.

Locke also wrote the charter for South Carolina, a slave society. He believed in tolerance for everyone, except atheists. He believed in God-given natural rights.

Though this strays slightly off topic, it's important to recognize that Locke said the earth was given to man by God and held in common. His argument for private property had a social function: one must leave "enough and as good" for all present and future people. It also required effort and sacrifice (ownership hinges on "mixing" one's labor with the land). Those considerations are ignored by most contemporary libertarians.

libertarian or constitutional scholar or anyone with half a fricken brain: "No. I wasn't born 6'6" and will never be a pro-ball player. Is that fair? Part of libertarianism is recognizing the difference between fairness which is subjective and justice which is objective."

Yes, that is similar to Milton Friedman's objection. He says that individuals can claim even greater advantages, with no effort or sacrifice, through the genetic lottery. He's basically advising those who live in a glass house to refrain from throwing stones.

There are two possible replies. The liberal reply uses the language seen in the first post and emphasizes natural abilities and meritocracy. "Yes, I did not really choose to be 6'6", but a meritocratic system should reward the most productive and talented among us." We're talking about claims to external resources.

It's also worth pointing out the interplay between genes and environment. Height is 90% inherited, but what do you say to a malnourished child who will not reach his "natural" height?

The same goes for the wasted and untapped abilities of children who inherit poverty and never receive a decent education.

"I am somehow less interested in the weight and convolutions of Einstein's brain than in the near certainty that people of equal talent have lived and died in cotton fields and sweatshops." -- Stephen Jay Gould

The second reply is simple and straightforward: Complete fairness is not a goal we can reasonably attain in the real world but that sad fact should in no way stop us from striving toward it. Inasmuch as we can create a level playing field, we should.

Consider for instance genetic engineering and our so-called "post-human" future. A wealthy family has access to the technology, and decides to produce the most attractive, intelligent, disease-averse individual possible. Notice here that the people with the best natural abilities *will* probably succeed... yet even those "natural" endowments have been consciously manufactured -- the direct product of pre-existing wealth and privilege. Now the poor lack access to genetic engineering and so their children are consigned to menial jobs. Is that fair? Well, a liberal (or any sane person, I think) would argue in favor of universal access, equal opportunity.

Libertarians should be horrified. The government has no right to steal from Peter to pay Paul. A subsidy is out of the question. Besides, free-market forces will *eventually*, some day, bring the cost down to the point where most people can afford it.

I don't know many people who can maintain that position with a straight-face. One of the initial appeals of libertarianism, I think, is that person supposedly gets what she deserves. This is implicitly seen in appeals to "natural rights" and "natural law," perfect justice meted out by nature. Humans just need to stop interfering. But they're not really defending free choices or meritocracy; worse, they confuse liberty with property. I suggest "propertarianism" is a more befitting term for their ideology.

I mean, a baseball team may face unusual, unexpected obstacles. Perhaps their star player's wife was brutally murdered and so he cannot play, a huge blow to defense, scoring production and morale. So what difference does it make if the opposing pitcher decides to throw spitballs? It violates the rules. Who creates those rules and for what end?

 

[corplinx]

Consider for instance genetic engineering and our so-called "post-human" future.

I suggest when that day comes, we should re-examine why government has a right to confiscate your estate from your heirs.

 

[UserGoogol]

When people die, they lose all entitlements to rights, because corpses are far too inanimate to be oppressed. So I don't really see how people have a right to be able to transfer their property after their death as they see fit. Because they're dead.

 

[Cain]

I suggest when that day comes, we should re-examine why government has a right to confiscate your estate from your heirs.

The hypothetical example only differs in degree from the current reality. Moreover, bioethics is arguably the most important and fascinating area of study in philosophy today. These issues are not beyond the consideration of Bush's bioethics panel for example (See _Beyond Therapy_). Libertarianism is in fact fairly common, maybe even dominant, in most transhumanist circles.

Nevertheless, UserGoogol has reminded me of another argument, somewhat related, that I first pondered on these very forums.

Suppose a person dies under suspicious circumstances, and the police suspect murder. Unfortunately, the victim, a deeply religious man, has made it all too clear in previous statements that under no circumstances shall his body be desecrated.

The state has an interest in performing an autopsy in order to identify and apprehend a potential murderer, possibly at large and capable of killing again. The individual (now deceased) wants his body treated according to his wishes.

Most people, including religious people, I think, are willing under these circumstances to disregard the wishes of the victim. That is to say: other concerns (interests, values) take precedence.

This scenario differs from estate taxes in a couple ways. It involves an individual's body; their most cherished beliefs; their "soul." What could possibly be more personal? In the case of taxable wealth after death we're dealing with external resources and material objects. (I'm quite willing to challenge the rather primitive idea that a person "owns" a parcel of the earth and can dispose of it however he pleases, though that's a slightly different topic.)

In the case of estate taxes the money getting redistributed can be used to save lives (whether or not the government spends the revenue wisely is another matter). It's also a matter of social justice: Improved access to education and healthcare, to cite only two examples, can be viewed as a matter of liberty; that is, an extension of one's sovereignty.

So what if an heir is deprived of 65 million dollars from a 75 million dollar fortune (assuming 100% taxation after a ten million dollar exemption)? None of that inherited wealth, I remind you, is earned anyway. Ten million dollars is more than most see in a life time.

Nearly three billion people live on less than (the equivalent of) two dollars a day.

 

[corplinx]

When people die, they lose all entitlements to rights, because corpses are far too inanimate to be oppressed. So I don't really see how people have a right to be able to transfer their property after their death as they see fit. Because they're dead.

Have you ever heard of a certain legal contract called a will?

 

[shanek]

I do not see how a libertarian can substantively challenge the analogy or the observation.

Okay, fine then. When you die we'll just sieze all of your property and throw your kids out onto the streets to fend for themselves. Sheez...

One of the major reasons I work so much is to provide for my kids. And I do want to make sure they're provided for after I'm gone. EXCUUUUSE ME.

Suppose, as most people do, that wealth does in fact confer significant advantages. Would a libertarian then agree an estate tax is justified in the interest of fostering a society more liable to reward talent and ability?

The Libertarian says it's NONE OF THE GOVERNMENT'S BUSINESS.

Instead I think libertarians appeal to an alternative set of values, one that claims (nearly) absolute property rights take precedence over a system that is more inclined to compensate an individual's natural capabilities.

No, we just appeal to the fact that it's NONE OF THE GOVERNMENT'S BUSINESS.

Well, the problem -- and this cuts to the heart of liberty -- is that they are in effect arguing for a social-economic system that allows a person's place in life to be determined by uncontrollable circumstances

Complete shash. We ARE ALL controlled, in part, by uncontrollable circumstances, but we're also controlled in much larger part by our own actions. How many people win $30 million in the lottery and then are broke the next year? Being given something is no guarantee of being a success with it.

Your mantra is that of the whiny selfish people who want things that they haven't earned and weren't given to them voluntarily.

It's NONE OF THE GOVERNMENT'S BUSINESS. PERIOD.

 

[Mr Manifesto]

Re: Re: Libertarianism and Inheritance

Okay, fine then. When you die we'll just sieze all of your property and throw your kids out onto the streets to fend for themselves. Sheez...

One of the major reasons I work so much is to provide for my kids. And I do want to make sure they're provided for after I'm gone. EXCUUUUSE ME.



The Libertarian says it's NONE OF THE GOVERNMENT'S BUSINESS.



No, we just appeal to the fact that it's NONE OF THE GOVERNMENT'S BUSINESS.



Complete shash. We ARE ALL controlled, in part, by uncontrollable circumstances, but we're also controlled in much larger part by our own actions. How many people win $30 million in the lottery and then are broke the next year? Being given something is no guarantee of being a success with it.

Your mantra is that of the whiny selfish people who want things that they haven't earned and weren't given to them voluntarily.

It's NONE OF THE GOVERNMENT'S BUSINESS. PERIOD.

Why isn't it the government's business? Isn't it the government's business to collect tax -which is used for the benefit of society- especially from different types of income?

 

[shanek]

By the way, isn't it amazing how much Cain relies on argument by authority and argumentum ad hominem to make his points?

 

[a_unique_person]

Re: Re: Libertarianism and Inheritance

Okay, fine then. When you die we'll just sieze all of your property and throw your kids out onto the streets to fend for themselves. Sheez...

I thought that was what Libertarianism was all about, self reliance. I don't think we are talking about children here, but adults.

 

[michaellee]

originally posted by Mr Manifesto
Why isn't it the government's business? Isn't it the government's business to collect tax -which is used for the benefit of society- especially from different types of income?

While if the governments role is to collect tax is another argument, the issue of the government role to collect tax from different types of income for the benefit of society can be addressed.

The estate tax is anything but a tax on income. If I work for 60 years, buy a house, save well, and die with an estate worth $5 million, I have already paid taxes on the income I made in order to buy the house and build a savings account. The estate tax is a blatant way for the government to tax again what has already been taxed, at the time it was earned.

 

[corplinx]

Re: Re: Re: Libertarianism and Inheritance

I thought that was what Libertarianism was all about, self reliance.

There is a difference between getting a handout from your dad and getting one from the government.

Are you suggesting that a child's allowance should be taxed too?

 

[Mr Manifesto]

While if the governments role is to collect tax is another argument, the issue of the government role to collect tax from different types of income for the benefit of society can be addressed.

The estate tax is anything but a tax on income. If I work for 60 years, buy a house, save well, and die with an estate worth $5 million, I have already paid taxes on the income I made in order to buy the house and build a savings account. The estate tax is a blatant way for the government to tax again what has already been taxed, at the time it was earned.

Yes, you have paid the tax. But the person who is inheriting your estate hasn't. And, in fact, with estate taxes, they are better off in a way, because if it were treated as outright income, they would be put in a higher tax bracket for the year of the inheritance.

 

[a_unique_person]

Re: Re: Re: Re: Libertarianism and Inheritance

There is a difference between getting a handout from your dad and getting one from the government.

Are you suggesting that a child's allowance should be taxed too?

Once a child is an adult, what is the difference?

 

[Cain]

Re: Re: Libertarianism and Inheritance

Originally posted by shanek Okay, fine then. When you die we'll just sieze all of your property and throw your kids out onto the streets to fend for themselves. Sheez...

One of the major reasons I work so much is to provide for my kids. And I do want to make sure they're provided for after I'm gone. EXCUUUUSE ME.

Well, then you should watch your blood pressure here. As I said, the current argument is over the existence of an estate tax. Suppose the exemption is 10 million dollars. Are you saying your children could not live comfortably off 10 million dollars? Or raise the exemption to 100 million dollars, as the Democrats proposed. Your children still would not be well-provided for?

The Libertarian says it's NONE OF THE GOVERNMENT'S BUSINESS.

No, we just appeal to the fact that it's NONE OF THE GOVERNMENT'S BUSINESS.

Calm down, Shanek; think of your children. Claiming -- or shrieking -- what the proper role of government is, without any supporting justification, is one thing. Bolstering your arguments with a clear appeal to a (rational) set of values is another.

Complete shash. We ARE ALL controlled, in part, by uncontrollable circumstances, but we're also controlled in much larger part by our own actions. How many people win $30 million in the lottery and then are broke the next year? Being given something is no guarantee of being a success with it.

I have already replied to this criticism by appealing to fairness and equal opportunity. Yes, all of us are products of circumstance -- genetic and environmental -- but that does not prohibit us from seeking to create a more fair society.

By the way, isn't it amazing how much Cain relies on argument by authority and argumentum ad hominem to make his points?

And of course you utterly, fantastically failed to support this with the appropraite documenation (as usual).

It's worth quoting this next part:

Your mantra is that of the whiny selfish people who want things that they haven't earned and weren't given to them voluntarily.

As for appeals to authority -- well, you never do that:

It's NONE OF THE GOVERNMENT'S BUSINESS. PERIOD.

Exclamation! What fortune-cookie wisdom did an elderly Asian gentleman give me recently... The hollow drum beats loudest?

I want to say that from our previous discussions you have all the philosophical sophistication of a tube sock. Revisit this charming thread on libertarian foundations for instance: http://www.randi.org/vbulletin/show...921&perpage=40&highlight=minimum&pagenumber=2 Read Victor's initial post (for the first time) and then see page two where I ask an elementary question. Hilarity ensues.

 

[shanek]

Re: Re: Re: Libertarianism and Inheritance

I thought that was what Libertarianism was all about, self reliance.

It's about personal responsibility. Amazing how you continually refuse to grasp that concept.