Rep. Kristi Noem has been peddling the estate tax repeal with her favorite tale of woe, about how her wealthy farm family failed to do the basic financial planning that would have prevented the Arnold-Noem clan from having to pay higher estate taxes on their father’s land when he died. Ah, but planning requires thinking, and thinking comes hard to Kristi Noem.
Rick Knobe also doubts our Congresswoman has sufficiently thought through repealing the estate tax:
In one of her “repeal statements” she said the tax only brings in about twenty BILLION (my emphasis) or so. Making it sound unimportant. In my mind, at the federal level a million dollars is important and twenty BILLION is very, very important.
It may be morally right to eliminate a tax if it hurts the ability of family businesses to continue. Even if the tax only affects a few people, if it is morally wrong, it should go.
My problem is the lack of discussion about cutting expenses or increasing revenue someplace else to make up the loss.
I asked our senior Senator John Thune on Viewpoint University about that issue. He said, eliminating the tax comes first, revenue replacement or expense cutting will come later.
From my vantage point living in a state and a city with balanced budgets and adequate surpluses, Senator Thune’s and Congresswoman Noem’s statements reveal our money problem in Washington.
Have Thune and Noem consumed too much “Washington Kool-aid?” Are they now part of the huge budget deficit and debt problem?
I hope not, but I am concerned about the lack deeper thought on this subject [link added; Rick Knobe, “The Death of the Death Tax: Smart Or Shallow Thinking?” KSOO Radio, 2015.04.22].
Mr. Kurtz has noted that Rep. Noem appears to be thinking only about a tiny group of really rich South Dakotans. The Center on Budget and Policy Priorities estimates that only 20 South Dakota estates would face any estate tax in 2016. Nationally, says CBPP, 0.2% of all Americans face any estate tax when they die. Rep. Noem would give them a tax cut averaging three million dollars (even though she thinks $125 a month to help a poor family eat is a waste of money).
Senator Thune seems similarly thoughtless on the estate tax issue. He hollers that a third of South Dakota’s farms are “vulnerable” to the estate tax, but his staff couldn’t give the Washington Post a single example of any South Dakotan having to sell the farm to pay the estate tax. WaPo declined to issue a “Pinocchio” ruling because “the issue of the estate tax has become so unmoored from the facts that it has moved into the realm of opinion,” but their columnist Dana Milbank doesn’t balk at deeming Noem, Thune, et al.’s fervid estate-tax-repeal pitch an effort to entrench an American aristocracy:
…And this at a time when the gap between rich and poor is already worse than it has been since the Great Depression? Never in the history of plutocracy has so much been given away to so few who need it so little.
…The estate tax was a meaningful check on a permanent aristocracy as recently as 2001, when there were taxes on the portion of estates above $675,000; even then there were plenty of ways for the rich to shelter money for their heirs. As the son of a schoolteacher and a cabinetmaker, I’d like to see the estate tax exemptions lowered — so that taxes encourage enterprise and entrepreneurship while keeping to a minimum the number of Americans born who will never have to work a day in their lives. The current exemption of $5.4 million (the current estate tax has an effective rate averaging under 17 percent, according to the Urban-Brookings Tax Policy Center) does little to prevent a permanent aristocracy from growing — and abolishing it entirely turns democracy into kleptocracy [Dana Milbank, “Republicans Push for a Permanent Aristocracy,” Washington Post, 2015.04.14].
Once again, South Dakota’s Congressional delegation is ignoring fiscal facts in favor of a fake issue that benefits only their richest friends.