Originally published at: http://boingboing.net/2017/02/09/multigenerational-wealth-makes.html
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Ummm but, what about that peski inheritance tax?
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Oh I am sure that will get fixed with this administration. 
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I don’t think I’ve ever said this before, but here goes…
…no duh.
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Hey @doctorow, I know people sometimes criticize you for your headlines, but there’s no need to overcompensate into “water is wet” “dog bites man” territory.
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Doesn’t apply for estates less than $VAST_SUM, actually. Most people leaving something behind don’t get taxed at all.
This really is the difficult problem of racial disparity, isn’t it? Because there isn’t anything you can do about it, not really. Oh, you could fix it, but you’d have to fix it for everyone and not only would the usual suspects howl “SOCIALISM!1!” in this instance they’d be right.
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Trying to convince people of this is strangely difficult.
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And this includes almost all family farms, ma-and-pa businesses, etc., despite what the GOP would have you believe.
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Yup. I know about it 'cos I was in an argument about it (@wisconsinplatt has the right of it: it’s comically difficult to convince people of this) and my interlocutor wailed about the family farm and I looked it up and the money amount is something horrifying like $5 million.
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Take financial asset inheritance out of the equation and the chart would look a lot similar. Money isn’t the only form of privilege capital that’s passed down from one generation to another.
Now, now, since 1993 you’re supposed to call it the “death tax.” Not that the GOP will feel the need to discuss it under any name for the next four years.
The chances of any individual inheriting more than $1-million (where the estate tax starts kicking in, IIRC) are only going to get slimmer in the future as wealth continues to concentrate in the top 1% of households.
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I looked it up. It’s way more: $5.4 million. And $11 million if you inherit something from your parents and have a good accountant. Though apparently some states do tax differently.
True, but it’s the big one. I’m confident if you took asset inheritance away it would totally change things. Of all America’s vices, it holds the worship of money dearest. Besides, money allows for other things to be transmitted.
Call it optimism. You can tax money. You can’t tax introductions to your dad’s golfing buddies.
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If you read the paper, it says almost nothing about inheritance–it cites someone who did and suggests that those benefits of several thousand a year could compound over time, but in my reading stops short of saying that is the reason. Mainly it seems to debunk certain hypotheses (single-parents, not-employed, education level).
This is corelational research with very small N in many of the groups–the racial advantage persists but it can easily stem from other factors as well as inheritance advantage, such as racism, bad schools, crime records preventing access to good jobs, credit, loans, etc.
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It seems so, but I don’t know. We are already quite close to 1929 levels of wealth disparity. There is a point where the distance in a wealth gap is so great that it collapses demand and the ability to service debt, Then the economy can no longer function.
No tree grows to the sun.
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I think we’re going to see some “interesting” solutions to that problem*, in particular a Universal Basic Income that will be designed to continue funnelling money to incumbent corporations and landlords while maintaining enough demand to maintain the illusion of a consumer economy. As for debt, they’re already laying the groundwork for debt peonage and imprisonment of one sort or another. $1-million+ inheritances will continue trending toward increased rarity in that scenario.
[* and the related ones of automation and offshoring]
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Because DEATH TAX!!!
Just another case of clueless red staters who don’t understand that the warm feeling is piss down their backs from the 1%, again.
I’ll hazard a guess that the main effect of modest generational wealth isn’t inheritance, it comes earlier than that. Getting a lump of cash when you’re in your 50’s or 60’s isn’t a “life changer”, as much of your life is over. But getting college without debt and/or a down payment for property IS a life changer when you’re young. My wife and I put together wedding money and some inherited from grandparents into a downpayment on a multifamily property, and that changed our lives unbelievably. Whatever my mom leaves me will go right from her IRA to mine, but she’s pretty sure she’s going to live till I’m retired! (Good genes)
The podcast EconTalk had a “debate” between economists about UBI recently that was interesting. Good, often fascinating podcast, even though the host is a pretty right wing, Chicago style economist.
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