Today Diogenes got an e-mail-chain-mail from his friend Andy.
Andy get these things from a Republican friend. Today’s was a poem about a farmer who is taxed to death, and then has to pay an inheritance tax… maybe you have seen it.
Tax his land, tax his bed, tax the table at which he’s fed…
The whole thing is a lie, of course. A farmer who is in poor financial health does not leave an estate large enough to pay an inheritance tax.
Diogenes does not know how you feel about inheritance taxes. Along with Bill Gates Sr and Bill Gates Jr, and Warren Buffet, Diogenes is in favor of inheritance taxes.
Let’s talk about Diogenes’ mother for a minute. Mom has quite a lot of money, by Diogenes standards, and Diogenes might inherit some of it. Diogenes is in favor of the inheritance tax. Mother, who has not a thing to lose, is very opposed to the Death Tax. She says that she has struggled (her word) for everything she has. She made most of her money from investing in Manhattan Real Estate. Make no mistake, Mom has done a great job with a building that she got a a very good price because it was losing money. She hired a PI to find the tenants who were not really living there (and were making more money per month sub-leasing than they paid in rent), and got the leases back. Then Mom did some construction so the apartments were no longer the same, and got them out of rent-stabilization. Anyway, she was very good at it and made a lot of money. The appreciation on the value of Mom’s investments has never been taxed. Not taxed to death, never taxed. She is taxed on income, but not on appreciation. Yes, Diogenes knows about the hideous New York City Real Estate Tax. The tenants pay for that, as they pay for the high cost of heating fuel.
Mother is not in the class of very wealthy, but they have this in common:
They money earned is taxed, the appreciation of wealth is not taxed.
If the Republicans succeed in abolishing the inheritance tax (now in a five year hiatus), they should name it the Paris Hilton tax relief act.
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Let’s think about this: No American farmer ever went out of business due to high taxes.
They go out of business because they cannot make a profit… the tax money is marginal to them. There are cycles of profitability in farming… sometimes they make a lot of money, sometimes they lose money. For a very long time, the big farm owners would buy up the small farms when the small farmers went bust.
In the 1930’s the Democrats put in a system of price supports that limited the profits in good years and prevented catastrophic losses. When the Republicans took control of the Congress and the White House in the 1950’s, they did not touch the farm programs. When Ronald Reagan was able to bully the Congress in the 1980’s, he did not touch those programs
When Newt Gingrich took control of the House in 1994, and Bob Dole ran the Senate, they passed the Freedom to Farm Act, supported by the biggest farm owners, who made it look like it would be a god-send to all farmers. Diogenes notes that it did not work out that way. Now the average size of US farms is much bigger than it was in 1994. The number of farmers in the United States is much smaller than it was in 1994. The biggest 5% of farm owners control over 40% of the acres in cultivation.
They would like to make some people believe that we need to support family farmers by reducing the tax burden. As we say here in Brooklyn, Fuggeddaboudidt! Here in Brooklyn, we used to have a lot of farms. There were farms in Canarsie even in the 1970’s. It was not taxes that put them out of business, it was prosperity… the land became worth much more than the value of the farm, so the farmers took the money – quite a lot of it – and went away.
The Republicans want us to think all those tax-eating programs, the ENTITLEMENTS, those Liberal programs, that’s what’s killing the farmers. Certainly not the five trillion dollars we have spent so far on the Iraq war.
And especially the War in Iraq, which has killed a good many sons of farmers, who went into the service because they could not make a living in agriculture.
Diogenes thinks that the Republicans have been very clever with their under-the-radar campaigns by e-mail and by use of (ugh!) right-wing radio that normal people cannot listen to without a big bottle of Ibuprofen. They have Frank Luntz and his clones, framing the debate so it’s about Mom and apple-pie and the American Way.
Diogenes hopes that a many people will adopt a skeptical approach to a lot of the stuff that shows up.
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Diogenes does not insist that the cost of the war in Iraq is five trillion dollars. Diogenes thinks that since we are going to have to replace 100% of all the land-based equipment owned by all of the armed services as the result of the war, this figure is closer than that of Mr Rumsfeld and Mr Gates. You know, a trillion here, and a trillion there, pretty soon you are talking about a lot of money.
