Tuesday, February 23, 2021
Bob Lord (Institute for Policy Studies), America’s Future: Trillionaire Trust Babies?:
Back in 1982, with Reaganomics in its infancy, the first Forbes list of America’s ultra-wealthy had just 13 billionaires on top. The two richest of these billionaires, Daniel Ludwig and Gordon Getty, held personal fortunes estimated in the $2 billion range. The other 11 billionaires on that first annual Forbes list clustered together at the $1 billion level.
Multiply that 1982 billionaire breakdown by 100 and you’d have something awfully close to the present list.
The nine current wealthiest Americans today — all white men — each hold a net worth above or rapidly approaching the $100 billion mark. Two of these “hectobillionaires,” Jeff Bezos and Elon Musk, hold around $200 billion.
To what do we owe this awesome increase in billionaire fortune? ...
Over recent decades, Republicans have hollowed out our estate and gift tax laws. Their legislating has allowed tax avoidance planners to effortlessly pass billions from one generation to the next — and often to the next generation after that — without incurring tax liabilities.
One former Donald Trump economic adviser, Gary Cohn, infamously noted that “only morons pay estate tax.” We can condemn Cohn’s disparagement of wealthy Americans who choose not to engage in tax avoidance, but we can’t challenge his basic point: In the United States today, the estate tax has become essentially a voluntary levy. ...
With fortunes well into the billions passing virtually tax-free from one generation to the next, the era of trillionaire trust fund babies is fast approaching. Our leaders could prevent that era. All they need would be the courage to reform our broken estate and gift tax system.