Investing in Estate Tax Reform: How 18 Families are Trying to Soak America

What was once a brilliant line from a screenwriter is now a solid rule of politics: "Follow the money." Any time there's a sweetheart provision inserted into legislation, there's probably a trail of spending by those who would benefit. All of which explains why Public Citizen and United for a Fair Economy were able to tie the entire campaign to end the estate tax back to the efforts of eighteen families. The names of some of these families will come as no surprise to many of our readers:
  • The Waltons -- Heirs to Sam Walton's billions, the family behind Wal-Mart stands to save billions of dollars with the repeal of the Estate Tax.
  • The DeVoses -- The founders of Amway are interested in getting their way. We've profiled Dick DeVos before. He and his wife speak poorly of high wages, but claim to support vouchers because of how they help further education. Right. We're sure his family supports the estate tax repeal in order to help family farmers.
Even more interesting are some of the names you may not be familiar with. Shortly after the report was released, the Seattle Post-Intelligencer published a Bloomberg article and editorialized about the short-sightedness and selfishness of those advocating for the Paris Hilton Tax Cut. Meanwhile, their competitors, the Seattle Times is controlled by one of the families that is leading the charge for estate tax repeal. In fact, the Seattle Times has lobbied for estate tax repeal -- a strange mission for a newspaper lobby. The newspaper's editorial page has also been vociferous in its advocacy for estate tax repeal, to the point that it plays fast and loose with the facts. For all of these individuals, the expenses of advocating for the estate tax repeal -- $50,000 in campaign contributions, $100,000 in lobbying fees, $200,000 to start shell astro-turf organizations -- are well worth it. With the repeal of the estate tax, they can expect to save anywhere between hundreds of millions of dollars and tens of billions of dollars. The downside, of course, is that the money disappears from the U.S. treasury -- an amount equal to $1 trillion over ten years. And the impact reaches far into the states. As Citizens for Tax Justice made clear in 2001 during discussion of the Bush tax plans, the impact of federal estate tax repeal on states could be as much as $350 billion over a ten year period on state budgets. At the federal level, shortfalls can be turned into deficits to be paid by future generations flush with cash from their large inheritances. States have no such ability. Regardless of whether the reform costs us now or later, though, the bottom line is that it is a bad idea. Large estates are a sign that the system works. And the estate tax is only paid by the wealthiest of individuals -- not by family farmers or small business owners. That's why despite a ten-year effort to demonize the estate tax, repeal remains deeply unpopular, with voters preferring reform to repeal by more than a 20% margin.