Wealth Transfer: The Irreconcilable Double Standards of Hostility and Envy
Hostility: Emotional Grounds For Transfer Taxes
I have to disclose first that I, throughout personal backgrounds, have a deep-rooted hostility toward the rich or idea of transferring wealth within wealthy people. Thus, my thought is thoroughly biased for the taxation that can limit the transfer of wealth. Oddly, however, I have always envied and admired the rich and their power with a naïve hope that I might be rich someday like them. Thus, I disagree with the taxation, which would be equivalent or amount to the near confiscation of property at death as suggested by Ascher. It is my personal belief that many, if not most, people would have similar irreconcilable thoughts with respect to tax on the transfer of wealth. Therefore, the discussion of transfer taxes (estate taxed supplemented by gift taxes) appears to be disclosing deep-rooted emotional response of individuals of how the playing field and rules of the game must be structured.
The hostility toward the rich and passing all of their wealth to subsequent generations is largely originated from the resistance of the perpetuation of wealth within wealthy families, thereby solidifying the existing social structure. Despite of the danger of over simplification, the wealth has been historically equated with the power and thus the rich, with more resources, exercise some power over others. The wealth and the accompanying power, which allow the rich to enjoy the dominance over others and higher standard of life quality (even if suspicious to call it as higher life quality), are successfully transferred to next generations through the inheritance of the wealth. The idea that the rich class can stay within a socially powerful class through an impenetrable system of wealth transfer, while the underprivileged class is hardly successful to move up to the class despite of the unceasing effort and hard work, even if not impossible, brings the uncomfortable feeling of unfairness or relative deprivation. Even if the poor or relatively underprivileged class is not deprived of anything directly by the rich, the huge discrepancy of the starting lines justifies the feeling of deprivation of equal opportunity to compete.
The underlying rationale of leveling the playfield in the taxing wealth transfer is best described by analogizing to a sports game, such as tracks. A player from underprivileged family does not think that the game is unfair with the reason that other player is born with good body structure and talent as an athlete, is provided with top-rate training with expensive coaches, or is raised with top quality of nutrition. However, a player will think that the game is unfair if the other player starts far ahead of him and the distance of the players is realistically too far to catch up. People have a strong belief or at least they want to believe that, even if they are poorly nurtured and not provided expensive...